NPS filed a shelf registration for $250 million in January, and on Friday it priced a public offering of 4 million shares at $23.95 per share, raising $95.8 million.

In its prospectus, the company said it plans to use proceeds from the offering to fund clinical trials; to fund the manufacture of clinical supplies of Preos for its Phase III program and the scale-up of commercial production of the drug; to fund the development of sales, marketing and manufacturing capabilities and buildup of inventory; to advance its preclinical research programs; potentially to in-license or acquire complementary product candidates or products, technologies or companies; and to fund general corporate purposes.

On the day of the shelf registration, Salt Lake City-based NPS's stock closed at $33.55. In May, it felt the effects from a potential problem with manufacturing for the Phase III trial of its severe osteoporosis drug, Preos. NPS had suggested it didn't have enough clinical supplies for its Phase III trial, causing Merrill Lynch to downgrade the company and draining $8.71, or about 27 percent, from its stock the day after the downgrade occurred. The stock dropped as low as $12.21 in July before beginning to climb. (See BioWorld Today, May 17, 2002.)

NPS's stock (NASDAQ:NPSP) rose 14 cents Friday to close at $24.23.

Preos, a recombinant, full-length human parathyroid hormone, is still in the Phase III trial designed to evaluate the product's ability to reduce fractures and build bone mineral density in women with osteoporosis. A Phase II trial showed Preos produced a statistically significant average increase in bone mineral density in the lumbar spine of nearly 7 percent after one year.

Preos also is being tested in a clinical trial by the University of California at San Francisco and sponsored by the National Institutes of Health in Bethesda, Md. The trial is designed to test whether Preos is more effective in building bone mineral density than Fosamax, sold by Merck & Co. Inc., of Whitehouse Station, N.J., and whether a combination of Preos and Fosamax is more effective in building bone mineral density than either therapy alone.

In its prospectus, NPS said it has enough clinical supplies of Preos to meet clinical needs into the 2003's first quarter. But, it said, it "cannot assure [that] the problems that we have recently experienced in producing finished clinical supplies of Preos will not reoccur in the future." It cautioned that if any such problems did occur, it "would be required to modify our finished product formulation and modify or terminate our clinical trials for Preos."

NPS also has AMG 073, its orally active, small-molecule compound designed to treat hyperparathyroidism. It is being developed by Amgen Inc., of Thousand Oaks, Calif., and Kirin Brewery Co. Ltd., of Tokyo, which have development and marketing rights to the product in specified territories. In December 2001, Amgen began Phase III trials of AMG 073 for secondary hyperparathyroidism.

The company also is developing ALX-0600, for short bowel syndrome. NPS completed a pilot Phase II trial and is evaluating trials in other gastrointestinal conditions, including Crohn's disease and ulcerative colitis.

The company released its earning last week. It reported a net loss of $18.2 million in the third quarter, or 60 cents per share, and a net loss of $61.4 million for the first nine months of the year. NPS said it would have about 34.5 million shares outstanding after the offering. It ended the third quarter with $157.6 million in cash, cash equivalents and marketable investment securities.

The offering book-running manager is Morgan Stanley & Co., with Merrill Lynch & Co. and Salomon Smith Barney as co-managers. The underwriters have a 30-day option on 600,000 shares to cover overallotments.