Canada's Labopharm plans follow-on of 10 million shares in United States, to be Nasdaq listed

By Ronda Fears

Memphis, April 18 - Labopharm Inc. announced plans Tuesday for a follow-on offering of 10 million shares of common stock in the United States with a request to list the shares on the Nasdaq.

Joint lead managers and bookrunners of the offering are Merrill Lynch & Co. Inc. and Banc of America Securities LLC.

Canaccord Capital Corp., Leerink Swann & Co., Orion Securities Inc., Dundee Securities Corp. and Westwind Partners Inc. are co-managers of the offering.

There is a greenshoe of 1.5 million shares available.

Proceeds from the deal, which the company said would be predominantly marketed in the United States, were estimated at $87.9 million. That was based on a U.S. price of $7.64, noting that Labopharm shares closed in Canada on Monday at C$8.42.

Labopharm shares ended Tuesday (Toronto: DDS) lost C$0.26, or 3.09%, at C$8.16.

Laval, Quebec-based Labopharm plans to use proceeds to support the commercialization of its once-daily tramadol product, to advance development of existing and new product candidates within its product pipeline, and for working capital and other general corporate purposes. The company is focused on the development of drugs incorporating Contramid - its proprietary controlled-release technology.

Its lead drug tramadol is a pain-killer that has been approved in Europe and is the subject of a New Drug Application under review by the Food and Drug Administration with a Prescription Drug User Fee Act date of Sept. 28 coming up.

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