Osiris Therapeutics Inc. boosted its cash position by $20 million through a private placement of stock led by the company's largest shareholder.

The Baltimore-based firm issued nearly 1.8 million shares priced at $11.38 apiece, the bulk of which - about 1.2 million shares, or $14 million - was purchased by Peter Friedli, owner and president of Swiss investment firm Friedli Corporate Finance Inc. Public firm New Venturetec Inc., another Swiss company affiliated with Friedli, purchased $3 million. Following the offering, Friedli, who helped establish Osiris and now serves as its chairman, will own about 45 percent of the company.

The latest fund raising should provide Osiris with a temporary infusion to advance its adult stem cell products, including Phase III studies of Prochymal in graft-vs.-host disease (GVHD) and Crohn's disease, though analysts at New York-based Jefferies & Co. Inc. doubted its new cash balance of $38 million would last beyond the first quarter of 2008. Based on the estimated net loss of $11 million per quarter, analysts wrote in a research note, Osiris' cash position "is unlikely to be sufficient" to sustain the company until Phase III data are released on Prochymal in second-line GVHD, expected by mid-2008. They added that further financings likely could involve Osiris drawing down funds from its $45 million equity credit line from partner Boston Scientific Corp., of Natick, Mass. Terms of the loan stem from the companies' ongoing collaboration to develop Provacel, an intravenously administered stem cell therapy aimed at cardiovascular disease.

Osiris, which develops therapeutics based on human mesenchymal stem cells derived from donor adult bone marrow, has one product on the market, Osteocel, for regenerating bone in orthopedic indications. First-quarter sales of Osteocel totaled $2 million.

Prochymal, its most advanced investigational product, is designed to treat immune conditions and is expected to complete enrollment in a 240-patient study in steroid-refractory acute GVHD in the first part of next year. A second Phase III study is ongoing in patients with relapsing/refractory Crohn's disease. Prochymal has both orphan drug and fast-track status.

Also advancing in the pipeline is Chondrogen, a preparation of adult stem cells formulated for direct injection into the knee and designed to regenerate the meniscus. That product is in a Phase I/II study, and six-month interim results reported in February showed that the trial did not show a statistically significant increase in the volume of meniscus as compared to placebo, though it did demonstrate an improvement in baseline cartilage and joint condition in about 30 percent of patients treated with Chondrogen vs. zero in the placebo group. Twelve-month data from the trial is expected later in 2007.

Earlier this year, Osiris made headlines with early Provacel clinical data. Findings reported in March at the American College of Cardiology meeting in New Orleans, showed that patients receiving that therapy had significantly lower rates of adverse events, including cardiac arrhythmias, as well as significant improvements in heart, lung and overall condition. Patient evaluation is ongoing. Shares of Osiris (NASDAQ:OSIR) gained 44 cents Thursday to close at $12.04.

In other financings news:

• AMDL Inc., of Tustin, Calif., raised $1.54 million in a second closing of a private placement, which now totals about $5.3 million in gross proceeds. In the second closing, ADML sold 587,000 shares at $2.625 per share. Investors also got three-year warrants to purchase up to 293,501 additional shares at $3.86 per share. The first part of the financing was disclosed a month ago. Funds primarily will be used to support work at Jade Pharmaceutical Inc., AMDL's wholly owned subsidiary in China.

• 7TM Pharma A/S, of Horsholm, Denmark, raised DKK123 million (US$22.2 million) in a financing round led by SR One Ltd., with support from existing investors. That money is expected to help accelerate the company's drug discovery and drug development programs, namely further clinical work on Obinepitide (TM30338) and TM30339, both of which are in development for obesity.

• NeoGenomics Inc., of Fort Myers, Fla., said investors purchased $4 million of its common stock in a private transaction. The stock was priced at $1.50 per share and resulted in the issuance of 2.7 million shares of new stock. The company said it used $1.7 million of the proceeds to pay off all of its existing short-term indebtedness, and remaining funds will be held in cash reserve for general corporate purposes. Noble Financial Group acted as the placement agent.

• Osteologix Inc., of San Francisco, closed a $5 million financing in which it sold 3.8 million shares and 1.9 million warrants to purchase common stock. The stock was sold at $1.32 per share, and warrants, which will expire Aug. 31, 2008, have an exercise price of $1.20 per share. The company said proceeds should fund operations into the second half of 2008. Osteologix expects results from a Phase II study of its lead product, NB S101, in osteoporosis during the fourth quarter. The company's stock (OTC BB:OLGX) gained 6 cents Thursday to close at 99 cents.

• Pharmion Corp., of Boulder, Colo., said underwriters of its recently completed public offering exercised in full their option to purchase an additional 600,000 shares, bringing the total offering to 4.6 million shares priced at $30 per share. Net proceeds of about $129.7 million will be used expand the company's commercial organization in anticipation of additional regulatory approvals, as well as for clinical trials and working capital. Shares of Pharmion (NASDAQ:PHRM) closed at $30.57 Thursday, down 70 cents. (See BioWorld Today, May 14, 2007.)

• PNP Therapeutics Inc., of Birmingham, Ala., received $925,000 in Series B financing through the Birmingham Technology Fund, managed by Greer Capital Advisors LLC, of Birmingham, and Phase 1 Holdings LLC. Proceeds will be used to move the company's technology into Phase I trials in solid tumors. PNP's approach is based on the combination of gene-delivery to the tumor mass coupled with prodrug activation directly within the tumor itself, and preclinical studies have shown that the PNP system compels solid tumors to create their own chemotherapy, causing self-destruction of the tumor. The company also appointed Frank Hunt as CEO, and named Lawrence Greer, of Greer Capital, to its board.

• Singulex Inc., of Hayward, Calif., raised $19.1 million in a private financing led by OrbiMed Advisors LLC and joined by existing investors Fisk Ventures, Prolog Ventures and Advantage Capital. Singulex, which offers customizable assays and a single molecule detection platform for monitoring protein biomarkers from normal to disease levels, said funds will be used to advance the scope and development of its commercial diagnostic solutions. In conjunction with the financing, the company added Carl Gordon, of OrbiMed, to its board.