Pharmos
Raises $8 Million in Private Equity Transaction With Institutional
Investors
ISELIN,
N.J., June 2 -- Pharmos Corporation (Nasdaq: PARS;
Nasdaq Europe: PHRM) announced today that it has raised
$8 million gross proceeds in an issuance of common stock
and warrants with a group of ten institutional investors.
Proceeds from the transaction will be used to fund Pharmos'
advanced Phase III development of dexanabinol for traumatic
brain injury (TBI), Phase II trial for prevention of post-surgical
cognitive impairment, and other research and development
activities.
"In
light of the uncertainty present in the biotech market,
we concluded that a new financing to fund our late-stage
operations was a prudent course of action," said
Haim Aviv, Ph.D., Chairman and CEO. "Our cash balance
is now at a level more consistent with forecasted needs."
An
aggregate of approximately 9.41 million shares was issued
at $.85 per share, representing an approximate 20% discount
to a ten-day trailing average of the closing price of
the stock ending May 28, 2003. The aggregate number of
five-year warrants issued was equivalent to 30% of the
total number of shares of common stock issued, with an
exercise price of $1.40 per share. The Company has agreed
to file a registration statement with the Securities and
Exchange Commission within thirty days to permit resales
of the common stock by the investors. Rodman & Renshaw,
Inc. acted as lead placement agent for this financing.
Dexanabinol
is the leading neuroprotective and anti-inflammatory compound
in Pharmos' CNS program. As previously announced, Pharmos
is expanding its ongoing international Phase III TBI trial
of dexanabinol into the U.S. and expects to complete patient
enrollment around year-end. The Company is also testing
dexanabinol for its effectiveness in preventing cognitive
impairment in a Phase IIa clinical study of heart surgery
patients.
Pharmos
discovers, develops, and commercializes novel therapeutics
to treat a range of indications, in particular neurological
and inflammation- based disorders. The Company's first
neuroprotective product is dexanabinol, a synthetic tricyclic
non-psychotropic dextrocannabinoid, currently undergoing
clinical testing as a treatment for TBI and as a preventive
agent against post-surgical cognitive impairment. Other
dextrocannabinoid compounds and CB2 receptor agonist compounds
from Pharmos' proprietary synthetic cannabinoid library
are being studied in pre-clinical programs targeting stroke,
pain, multiple sclerosis and other disorders.
Statements
made in this press release related to the business outlook
and future financial performance of the Company, to the
prospective market penetration of its drug products, to
the development and commercialization of the Company's
pipeline products and to the Company's expectations in
connection with any future event, condition, performance
or other matter, are forward-looking and are made pursuant
to the safe harbor provisions of the Securities Litigation
Reform Act of 1995. Such statements involve risks and
uncertainties which may cause results to differ materially
from those set forth in these statements. Additional economic,
competitive, governmental, technological, marketing and
other factors identified in Pharmos' filings with the
Securities and Exchange Commission could affect such results.
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