Axonyx Inc. raised $20 million through a private sale of stock and warrants.

The New York-based company entered definitive agreements with new institutional investors for a placement of securities, including about 3.1 million common shares at $6.50 apiece and five-year warrants to purchase an additional 923,077 shares at an exercise price of $8.50 each. Axonyx said it would file a registration statement with the SEC for the stock's resale within 30 days.

On Tuesday, the company's stock (NASDAQ:AXYX) dropped 42 cents to close at $6.79.

UBS Securities LLC was the transaction's exclusive placement agent, and Punk Ziegel & Co. acted as a financial adviser. Both are based in New York.

The financing follows two stock-and-warrant placements closed in the past year that brought in $75 million - Axonyx raised $25 million at the end of last summer and an additional $50 million this winter. (See BioWorld Today, Sept. 15, 2003, and Jan. 9, 2004.)

The company had $28.8 million in cash and cash equivalents as of Dec. 31, with about 33.4 million shares outstanding. It posted a $3.5 million net loss in the preceding quarterly period.

Axonyx plans to use its latest proceeds to broaden its portfolio through the acquisition of new and complementary technologies focused on the central nervous system, especially protein disorders such as Alzheimer's disease, Down's syndrome, Parkinson's disease, Lou Gehrig's disease and other similar conditions, and to fund working capital requirements for ongoing research, development and operations.

Its lead candidate, Phenserine, is a treatment for Alzheimer's disease. The dual-action acetylcholinesterase and beta-amyloid precursor protein inhibitor, licensed from the National Institute of Aging of the National Institutes of Health, is in a European-based Phase III study evaluating two doses. A Phase IIb study also is continuing to evaluate its ability to lower the levels of the beta-amyloid precursor protein and beta-amyloid in the plasma and cerebrospinal fluid in mild to moderate patients. (See BioWorld Today, June 27, 2003.)