EPIX Pharmaceuticals Secures Committed Equity Financing Facility

2008-08-05 05:30:00

EPIX Pharmaceuticals Secures Committed Equity Financing Facility

Financing Facility May Provide Up To $50 Million of Capital

LEXINGTON, Mass.–(EMWPresswire)–EPIX Pharmaceuticals, Inc. (NASDAQ:EPIX), a biopharmaceutical company

focused on discovering and developing novel therapeutics through the use

of its proprietary and highly efficient in silico drug discovery

platform, announced today that it has entered into a Committed Equity

Financing Facility (CEFF) with Kingsbridge Capital Limited, a private

investment group. Under the terms of the agreement, Kingsbridge has

committed to provide up to $50 million of capital during the next three

years through the purchase of newly issued shares of EPIX common stock.

The maximum number of shares that can be sold by EPIX under this

agreement is approximately 8.3 million shares. EPIX will determine the

exact timing and amount of any CEFF financings, subject to certain

conditions. The actual amount of funds that can be raised under this

agreement will be dependent on the number of shares actually sold under

the agreement and the market value of EPIX stock during the pricing

periods of each sale.

This financing facility should provide EPIX

with additional access to capital as we continue to execute our Vasovist®

monetization and clinical development strategies,

said Kim C. Drapkin, chief financial officer of EPIX. Based

upon the agreements flexible terms, we will

be able to draw down capital to efficiently support our corporate and

clinical initiatives. We have recently resubmitted our New Drug

Application for Vasovist, initiated our Phase 2b proof-of-concept

program for PRX-03140 for the treatment of Alzheimers

disease and expect to commence our Phase 2b trial for PRX-08066 for the

treatment of pulmonary hypertension associated with chronic obstructive

pulmonary disease. We believe these recent and upcoming milestones

illustrate our strong focus on building value through the development of

our broad clinical pipeline.

Details of EPIXs CEFF with Kingsbridge are as

follows:

  • Kingsbridge is committed under the CEFF to purchase the lesser of 8.3

    million shares or $50 million of common stock from EPIX. EPIX

    may access the capital for up to three years after the Securities and

    Exchange Commission declares effective the registration statement to

    be filed by EPIX covering the resale of the shares of common stock

    issuable to Kingsbridge in connection with the CEFF.

  • EPIX may access capital under the CEFF in tranches of up to 1.5% of

    EPIXs market capitalization at the time of

    the draw down. Alternatively, based upon the companys

    prior 30-day trading volume, EPIX may have the ability to increase

    each draw down from 1.5% to up to 3% of its market capitalization at

    the time of the draw down. Kingsbridge will purchase shares of common

    stock pursuant to the CEFF at discounts ranging from 6% to 12%

    depending on the volume-weighted average market price of the common

    stock during the eight-day pricing period, provided that the minimum

    acceptable purchase price for any shares to be issued to Kingsbridge

    during the eight-day period is determined by the higher of $1.25 or

    90% of EPIXs common stock closing price

    the day before the commencement of each draw down.

  • EPIX is not obligated to utilize any of the $50 million available

    under the CEFF and there are no minimum commitments or minimum use

    penalties. The CEFF agreement does not contain any restrictions on EPIXs

    operating activities, automatic pricing resets or minimum market

    volume restrictions.

  • The agreement does not prohibit EPIX from conducting additional debt

    or equity financing, other than financings similar to the CEFF.

  • Kingsbridge is restricted from engaging in any shorting transaction of

    EPIXs common stock.

  • In connection with the CEFF, EPIX issued a warrant to Kingsbridge to

    purchase up to 400,000 shares of common stock at an exercise price of

    approximately $2.49 per share which represents 125% of the

    average of the closing prices of the common stock during the five

    trading days preceding the agreement date. The warrant will become

    exercisable six months from the date of the agreement and will remain

    exercisable, subject to certain exceptions, for a period of five years

    thereafter.

The warrant issued to Kingsbridge and the shares of common stock

issuable under the CEFF, and the shares issuable upon the exercise of

the warrant, have not been registered under the Securities Act, or state

securities laws, and may not be offered or sold in the United States

without being registered with the SEC or through an applicable exemption

from SEC registration requirements. EPIX has agreed to file a

registration statement with the SEC covering the resale of the shares

issuable under the CEFF and the shares issuable upon the exercise of the

warrant within 60 days of the date of the agreement.

This news release shall not constitute an offer to sell or the

solicitation of an offer to buy, nor shall there be any sale of any of

the securities referred to in this news release in any state in which

such offer, solicitation or sale would be unlawful prior to the

registration or qualification under the securities laws of any such

state. Any offering of EPIX common stock under the resale registration

statement referred to in this news release will be made only by means of

a prospectus.

About EPIX

EPIX Pharmaceuticals is a biopharmaceutical company focused on

discovering and developing novel therapeutics through the use of its

proprietary and highly efficient in silico drug discovery

platform. The company has a pipeline of internally-discovered drug

candidates currently in clinical development to treat diseases of the

central nervous system and lung conditions. EPIX also has collaborations

with leading organizations, including GlaxoSmithKline, Amgen, Cystic

Fibrosis Foundation Therapeutics and Bayer Schering Pharma. For more

information, please visit the companys

website at www.epixpharma.com.

This news release contains express or implied forward-looking

statements within the meaning of the Private Securities Litigation

Reform Act of 1995 that are based on current expectations of management.

These statements relate to, among other things, the projected date for

the filing of the registration statement for resale of the shares

referred to in this news release, the estimation of funds that might be

raised under the CEFF, the commencement of the Phase 2b trial for

PRX-08066, and management’s plans, objectives and strategies. These

statements are neither promises nor guarantees, but are subject to a

variety of risks and uncertainties, many of which are beyond our

control, and which could cause actual results to differ materially from

those contemplated in these forward-looking statements. In particular,

the risks and uncertainties include, among other things: risks that

product candidates may fail in the clinic or may not be successfully

marketed or manufactured; risks relating to our ability to advance the

development of product candidates currently in the pipeline or in

clinical trials; failure to obtain the financial resources to complete

development of product candidates; our inability to further identify,

develop and achieve commercial success for new products and

technologies; competing products may be more successful; our inability

to interest potential partners in our technologies and products; our

inability to achieve commercial success for our products and

technologies; our inability to successfully in-license products and/or

technologies; our inability to successfully defend against litigation;

our inability to protect our intellectual property and the cost of

enforcing or defending our intellectual property rights; our failure to

comply with regulations relating to our products and product candidates,

including FDA requirements; the risk that the FDA may interpret the

results of our studies differently than we have; the risk that we may be

unable to successfully secure regulatory approval of and market our drug

candidates; and risks of new, changing and competitive technologies and

regulations in the U.S. and internationally. Existing and prospective

investors are cautioned not to place undue reliance on these

forward-looking statements, which speak only as of the date hereof. We

undertake no obligation to update or revise the information contained in

this press release, whether as a result of new information, future

events or circumstances or otherwise. For additional information

regarding these and other risks that we face, see the disclosure

contained in our filings with the Securities and Exchange Commission,

including our most recent Annual Report on Form 10-K and subsequent

Quarterly Reports on Form 10-Q.

EPIX
Kim C. Drapkin, 781-761-7602
Chief Financial Officer
or
Pure

Communications
Jennifer Beugelmans, 646-596-7473

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