Corixa Corp. expects to raise $105 million through the combination of a convertible subordinated notes offering and a private placement financing.

The Seattle-based business plans to raise $30 million from the latter, which is contingent on closing the $75 million notes purchase agreement. Corixa said the notes, which it is offering to an unspecified group of institutional buyers, have a five-year term and will be convertible at the holders' option into Corixa common shares.

"We have not disclosed the expected close date, but we will provide that when we provide an update on pricing of the deal," Jim DeNike, Corixa's director of corporate communications, told BioWorld Today. "Until we price the agreement, we won't be able to go into any more detail other than what we have released."

The interest rate, conversion price and offering price have yet to be determined as negotiations continue. The notes will be subordinate to existing and future senior indebtedness of Corixa, which also plans to grant the initial purchasers a 13-day option to purchase up to an additional $12 million principal amount of the notes.

At the same time the company entered a definitive agreement to sell newly issued common shares and warrants to purchase additional common stock to an unnamed institutional investor for gross proceeds of about $30 million.

DeNike said Corixa has about 50.4 million shares outstanding.

The stock's purchase price will be equal to fair market value on the date the contingency regarding the execution of a definitive note purchase agreement is satisfied or waived, determined according to an average of recent trading prices. The warrants will have an exercise price equal to the purchase price of the common stock and a five-year term.

Corixa, which reported $101 million in cash reserves as of March 31, said it would use the net proceeds for research and development and general corporate purposes. In the near term, the company is looking toward a regulatory ruling on its lead product, Bexxar, in two months.

A month ago, the FDA said it would delay acting on the company's biologics license application by three months. Corixa and its London-based partner, GlaxoSmithKline plc, received notice that the agency would extend the Prescription Drug User Fee Act date to Aug. 1. But the company stressed that new trials were not needed for the product, a radioimmunotherapy for non-Hodgkin's lymphoma. (See BioWorld Today, May 6, 2003.)

"We're continuing to work with the FDA to make sure that we have satisfied the outstanding items that they have indicated we need to resolve before they can make a definitive decision," DeNike said.

GlaxoSmithKline is partnered with Corixa on another product, Fendrix, for which it filed for European approval last month. The hepatitis B vaccine uses Corixa's MPL adjuvant. Several other adjuvants are in Phase III trials for various indications, including breast cancer, allergies, melanoma and herpes.

Corixa's stock (NASDAQ:CRXA) fell $1.02 Monday, or 12.2 percent, to close at $7.34.