CBio, an Australian-based drug development company, has completed a AUD10mn capital raising ahead of a planned share market listing later in 2009.
The capital raising was underwritten to AUD6m by financial services house Novus Capital which acted as financial adviser and underwriter and will be advising CBio in the IPO process.
Funds raised by the recent share placement and the IPO will be used to continue development of CBio’s drug therapy XToll, which is targeted to combat the chronic autoimmune disease rheumatoid arthritis.
CBio has undertaken clinical trials with XToll in more than 150 patients and the company is now conducting a phase II clinical trial in patients suffering moderate to severe rheumatoid arthritis. These trials are due for completion in the first half of 2011.
XToll has been developed from intellectual property generated at the University of Queensland. The drug is protected by numerous patents and a notice of allowance covering the US market where three major rheumatoid arthritis therapies generated sales in excess of USD10bn in 2008.
Prior to and excluding this capital raising, CBio has spent AUD47m on the development of XToll, with these funds coming mainly from its existing shareholder base of sophisticated investors and smaller retail investors, as well as research grants. Many current investors have taken a keen interest in CBio since it was founded nine years ago.
Stephen Jones, CBio executive chairman, says: “The planned ASX listing is a strategic initiative that will enable CBio to access funding from sources previously unable to invest in the company. These funds will allow CBio to complete the development programme through to the end of the current clinical trial which, if successful, will be the most significant value inflection point for the company, and for shareholders. “Rheumatoid arthritis is a cruel disease. Joint destruction and pain inflicted can be so overwhelming as to severely affect quality of life.”
