Washington Editor

Icagen Inc. is raising about $22 million in gross proceeds by way of a private stock and warrant deal to finance research and development programs, as well as general corporate purposes.

Chief Financial Officer Richard Katz told BioWorld Today that the added capital extends Icagen's fiscal reserves, which stood at $29.8 million as of Sept. 30 and would last about a year right now, by another 12 months. "We thought it prudent."

The portfolio for the Research Triangle Park, N.C.-based biopharmaceutical company features "a broad research pipeline" of oral small molecules that modulate ion channel targets.

Its most advanced product, senicapoc (ICA-17043), is partnered with McNeil Consumer & Specialty Pharmaceuticals, a division of Johnson & Johnson, of New Brunswick, N.J. A Phase III study for sickle cell disease is expected to reach its targeted enrollment of 200 patients next quarter, with data due in the third quarter of next year.

The single pivotal trial is expected to support a new drug application, despite a significant hiccup last year that eliminated about half the patients enrolled to that point. The protocol amendment - based on a recommendation that the trial only should continue with patients receiving concurrent chemotherapeutic treatment with hydroxyurea - also pointed to a smaller market potential for senicapoc, causing a three-quarter drop in the company's stock value in a single day to $1.12. (See BioWorld Today, Aug. 7, 2006.)

The double-blinded study is focused on patients who in the year before entering the study had at least two crises, which include acute pain episodes that prompt several hospital days worth of supportive care with intravenous hydration, supplemental oxygen and narcotics. A significant number of sickle cell disease patients receive the antineoplastic drug, Katz said, but it reduces their crises only by about 40 percent, so the company expects senicapoc to further lower the incidence of crises and provide hematologic benefits.

The trial's primary endpoint is exploring the crisis rate reduction between senicapoc and placebo in patients on background hydroxyurea therapy. Katz added that pending market research would help define the number of patients who take hydroxyurea and would therefore be candidates for combination treatment with senicapoc, if approved.

In addition to the Phase III work, Icagen and its partners are continuing to enroll pediatric sickle cell disease patients in a Phase I/II study, and expect to begin Phase II pediatric testing in the third quarter. Also, the companies expect to begin a Phase II trial next quarter in sickle cell disease patients with secondary pulmonary arterial hypertension, a common complication of the illness, which afflicts 120,000 people in the U.S. It's the most common genetic disease in African Americans.

Additional programs at Icagen remain in preclinical development, led by a compound for epilepsy and neuropathic pain that's in advanced preclinical studies. Katz said an investigational new drug application should be filed around the middle of this year.

Earlier research is being conducted on a sodium channel program for pain aimed at a variety of targets, including SCN9A, for which Icagen has an exclusive license, and a calcium channel program for pain. Other research activities are focused on inflammation, sleep disorders and attention deficit/hyperactivity disorder.

Partnered preclinical programs include a compound for atrial fibrillation, with Bristol-Myers Squibb Co., of New York, and leads for memory disorders, with Astellas Pharma Inc., of Tokyo.

Icagen's placement includes 15.4 million common shares and warrants for another 5.4 million. The company is selling units comprised of a single share and 0.35 of a warrant for $1.42 apiece. The five-year warrants have an exercise price of $1.45 per share.

Icagen, which recently regained compliance with Nasdaq listing requirements, secured its definitive securities purchase agreement with institutional and other accredited investors, including both new and existing backers. Principal investors include Greenway Capital, of Dallas; QVT, of New York; Venrock Associates, of New York; Alta Partners, of San Francisco; and an affiliate of Quintiles Transnational Corp., of Research Triangle Park.

The company, which had about 22.3 million shares outstanding on Sept. 30, expects the transaction to close on or about Friday, subject to customary closing conditions. On Monday, its shares (NASDAQ:IGCN) gained 7 cents to close at $1.43.

In other financing news:

• MediciNova Inc., of San Diego, raised about $11.2 million in proceeds, net of underwriting commissions but before expenses, after pricing a public offering of 1 million common shares at $12 apiece. The biopharmaceutical company plans to use the money for general business purposes, such as funding studies of its six clinical compounds for asthma, multiple sclerosis, status asthmaticus, interstitial cystitis, solid tumors, generalized anxiety disorder, preterm labor, urinary incontinence and thrombotic disorders. MDB Capital Group LLC, the offering's sole underwriter, has a 150,000-share overallotment option. The offering is expected to close on Thursday.

• Genelabs Technologies Inc., of Redwood City, Calif., received almost $2.2 million in gross proceeds after selling substantially all of its remaining equity in Genovate Biotechnology Co. Ltd., a Taiwan-based specialty pharmaceutical company formed in 1995 by Genelabs, which is developing drugs for lupus and hepatitis C. In the transaction, Genelabs sold 7.1 million Genovate shares.