Advancis IPO goes at $10 a share

$60 million is raised by Maryland developer of `pulsatile' drugs

October 18, 2003|By William Patalon III | William Patalon III,SUN STAFF

Advancis Pharmaceuticals Corp. raised $60 million in an initial public stock offering yesterday despite a lackluster IPO market that helped force the Germantown biotechnology company to scale back its plans.

Advancis, whose technology is designed to "supercharge" infection-fighting drugs, announced yesterday that it sold 6 million of its shares at $10 a share. A souring IPO market apparently had an impact on the deal.

The company declined to comment on the stock offering, citing the "quiet period" required under federal securities regulations. Coming into the week, Advancis had planned to price its shares at $12 to $14.

The offering failed to materialize as planned after the close of trading Wednesday. Then, after a day's delay, the offering price was chopped by $2 a share, according to the Dow Jones news service.

After rising to a high of $10.30 in early trading yesterday, Advancis shares dropped to $9.88 and spent the remainder of the day close to their $10 closing price.

Even though the IPO market has been improving, it is much weaker than it was during its red-hot days of 1999 and 2000. There were 20 IPO deals from July to September this year, up from six during the corresponding period last year, according to Hoover's IPO Central.

There were 81 IPOs during the corresponding quarter in 1999 and 94 in 2000, Hoover said.

Advancis, a developmental stage company, has yet to book revenue but has several drugs in early clinical trials.

Unlike many biotech companies, which don't expect to have products on the market for years, Advancis has said it could have drugs on the market in 2005. That shorter lead time results from Advancis' working initially with existing drugs that have been through the federal approval process.

Advancis is focused on developing "pulsatile" drugs to fight infections. Such antibiotics are delivered in rapid sequential bursts.

Studies have shown that increases their effectiveness, the company said.

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