Alteon Inc. raised about $7.7 million for its lead product, ALT-711, and for the development of other products deeper in the pipeline.

Ramsey, N.J.-based Alteon sold 2.3 million shares at $3.50 per share to institutional investors. Its stock (AMEX:ALT) fell 13 cents Wednesday to close at $3.79.

Alteon is developing ALT-711, an advanced glycation end-product (A.G.E.) crosslink breaker. ALT-711 is designed to break A.G.E. crosslinks, which might reverse tissue damage caused by aging and diabetes, thereby restoring flexibility and function to blood vessels and organs of the body, Alteon said. The company is developing ALT-711 for cardiovascular diseases and has completed two Phase IIa studies. Alteon said positive results from the trials suggest that ALT-711 might be useful against a number of cardiovascular conditions, including systolic hypertension and diastolic heart failure.

Alteon has initiated two Phase IIb trials for ALT-711 - the Sapphire trial, focused on patients with systolic hypertension, and the Silver trial, focused on systolic hypertension and left ventricular hypertrophy. Data from the trials are expected around mid-year. Alteon also is considering development of ALT-711 in other conditions.

A topical formulation of an A.G.E. crosslink breaker, ALT-744, is being clinically evaluated in skin aging for cosmetic applications. The company is evaluating potential clinical trials in other cardiovascular and therapeutic indications for A.G.E. crosslink breaker compounds.

Alteon is evaluating opportunities from other classes of compounds stemming from its patent estate, including A.G.E.-formation inhibitors that target the A.G.E. pathway by inhibiting the formation and crosslinking of A.G.E.s. In addition, it is researching diabetes to develop compounds focused on glucose regulation and control, although that work is still in the research stage.

Alteon reported a net loss applicable to common stockholders of about $20.4 million for the year ended Dec. 31. For the fourth quarter, it lost about $4 million. Cash, cash equivalents and short-term investments as of Dec. 31, were $17.4 million. It used about 32 million shares outstanding to calculate its fourth-quarter loss-per-share figures.