Selling a million more shares than originally planned, Onyx Pharmaceuticals Inc. raised net proceeds of $71.2 million after pricing 5 million shares at $15.25 apiece.

The Richmond, Calif.-based company could receive up to $11.4 million more if the offering's underwriters exercise a 30-day overallotment option to purchase up to 750,000 more common shares. Onyx, which is selling all the stock, is making the offer pursuant to an effective registration statement filed last month with the SEC to sell up to $75 million in common stock.

On Tuesday, its shares (NASDAQ:ONXX) gained 41 cents to close at $15.92.

The company priced the offering just a week after reporting plans to sell 4 million shares. Onyx, which had 23.8 million shares outstanding prior to the sale, reported $37.7 million in cash, cash equivalents and marketable securities through March 31. (See BioWorld Today, July 15, 2003.)

The offering's underwriters are being represented by a trio of New York-based firms - Lehman Brothers Inc., SG Cowen Securities Corp. and Morgan Stanley & Co. Inc. - with the latter its sole bookrunner.

Among general uses for the proceeds, Onyx said it would use the money to fund ongoing and future clinical trials of its lead cancer compound, BAY 43-9006.

Last month, the company cut the majority of its staff to focus on the Phase II product. About 20 people remain to work on the product, a Raf kinase inhibitor partnered with Bayer Corp., a subsidiary of Leverkusen, Germany-based Bayer AG. (See BioWorld Today, June 13, 2003.)

Under the partnership, Onyx is bound to pay 50 percent of development costs. The company has said it expects to begin Phase III studies later this year.

BAY 43-9006 has been studied in four Phase I single-agent studies, eight ongoing Phase Ib studies combining the compound with different standard chemotherapies and two ongoing Phase II single-agent studies.

If BAY 43-9006 is approved and marketed, Onyx would share U.S. profits equally, but its share would be less than 50 percent elsewhere as Bayer has exclusive rights. In Japan, Bayer will fund product development and Onyx would receive a royalty based on sales.

The layoffs marked the second such restructuring this year at Onyx, which reduced its headcount by 25 percent six months earlier. That decision resulted from the loss of Warner-Lambert Co. as a partner in the development of the cancer drug ONYX-015, a modified adenovirus. The most recent cuts were felt in the company's therapeutic virus area, which included the ONYX-015 staff. (See BioWorld Today, Jan. 28, 2003, and Sept. 18, 2002.)