AspenBio Pharma (AAPY) announced an it has priced a public offering of 4,482,609 shares of its common stock at $1.70 per share. The approximately $7.2 million of net proceeds, after deducting the underwriting discounts and commissions and estimated offering expenses, will be used for product development, FDA 510(k) submission related activities, general corporate purposes, and working capital. The offering is expected to close on or about October 13, 2009, subject to the satisfaction of customary closing conditions.
ThinkEquity did a poor job pricing the deal. The shares closed at $2.15 yesterday and now trade at $1.87, down 13%. APPY should have found another banker.
Douglas A. McIntyre
Aspen Biopharma (Naddaq – APPY) shares are up more than 20% in Thursday trading on more than twice their normal volume, as traders appear to be anticipating FDA approval for the company’s AppyScore test that helps diagnose appendicitis.
Aspen Bio previously had said it expects to file for FDA approval by end of the second quarter — which is now in roughly 8 trading days.
Appendicitis is expected to affect 5 to 7% of all people in the world at some point in their lives. The company says that in the U.S. alone, about 6 million patients enter emerency rooms each year complaining of abdominal pain, of which about 320,000 cases are diagnosed as appendicitis. To date, there appears to be no individual sign, symptom, test, or procedure capable of providing an objective and reliable diagnosis of the condition.
Institutional interest may have increased in recent months for APPY shares, following a Lazard-sponsored roadshow in April. It’s possible that second-quarter SEC filings will show there’s more institutional ownership than the 22% reflected as of the company’s March 31 filings. Peak institutional ownership of APPY shares had been 55% of the shares outstanding.
While the potential FDA approval filing is today’s driver, Daryl J. Faulkner being named CEO in February brings heavy diagnostics experience, as well as a leader that’s been at the helm at other biotech companies that were acquired. He most recently served about two years as president and CEO Digene Corporation, a Nasdaq-traded company, prior to its acquisition in July 2007 by Qiagen.
BNP Paribas overseas has lowered ratings of AstraZeneca (NYSE: AZN) to Underperform from Neutral; and raised Novartis (NYSE: NVS) to Neutral from Underperform.
Goldman Sachs has raised Novo Nordisk (NYSE: NVO) to Buy from Neutral; Charles River Laboratories (NYSE: CRL) downgraded to Neutral at Goldman Sachs.
JPMorgan has raised its rating on Invitrogen (NASDAQ: IVGN) to Overweight from Neutral.
Lazard Capital Markets started coverage of Aspenbio (NASDAQ: APPY) with a “Buy” rating.
R.W.Baird Downgraded Third Wave Technologies (NASDAQ: TWTI) to Neutral from Outperform.
June 24, 2008