New York, Dec. 21 - Nucryst Pharmaceuticals Corp. priced its initial public offering at $10 per share for a total size of $45 million, reduced from the planned size.
The deal came cheaper than talk of $12 to $14 per share and, at 4.5 million shares, smaller than the 5.77 million planned.
There is a greenshoe for 675,000 shares, reduced from 865,500.
Jefferies & Co. is the lead underwriter with participation from Adams Harkness, GMP Securities and SunTrust Robinson Humphrey.
The IPO was to spin off Nucryst from Westaim Corp. Immediately after completion of the offering, Fort Saskatchewan, Alta.-based Westaim will directly own 75.1% of Nucryst shares or 71.5% if the greenshoe is exercised in full.
Wakefield, Mass.-based Nucryst develops wound care products. It has developed nanocrystalline silver in a powder form for use as an active pharmaceutical ingredient called NPI 32101.
Nucryst is in phase 2 clinical trials of a topical cream formulated with NPI 32101 to relieve the symptoms of atopic dermatitis, a form of eczema that has no cure.
Nucryst said that a cream containing NPI 32101 may be well received by physicians and patients because it appears, based on the results of preclinical and clinical trials, to address both inflammation and infection without presenting the potential rare drug-related serious adverse side effects associated with steroids and topical immunomodulators.
In addition, Nucryst said NPI 32101 may be useful for treating a wide range of infectious and inflammatory diseases, such as dermatological and gastrointestinal conditions.
The company plans to use about $35.0 million of the proceeds for new production facilities and equipment, clinical trials and other research and development activities, working capital and other general corporate purposes.
Nucryst said it expects the proceeds will be sufficient to complete the current phase 2 clinical trial for NPI 32101 and a substantial portion of the phase 3 clinical trials for NPI, but additional financing will be necessary to complete the phase 3 trials for NPI 32101 and, if the phase 3 clinical trials are successful, to submit a related New Drug Application and any product launch of a cream containing the substance.
The remaining $6.9 million of the IPO will go to repay part of the debt owed to Westaim, which has previously been Nucryst's only source of external financing. Nucryst owes $45.4 million to its parent.
Nucryst had net income of $194,000 on product sales of $13.86 million for the first nine months of 2005 versus a profit of $2.74 million on sales of $9.73 million in the year-ago period. Milestone payments were $5 million for the 2005 period and $10 million for the 2004 period.
Nucryst common shares have been approved for quotation on the Nasdaq National Market under the symbol "NCST" and conditionally approved for listing on the Toronto Stock Exchange under the symbol "NCS".
| Issuer: | Nucryst Pharmaceuticals Corp.
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| Issue: | Initial public offering of common stock
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| Amount: | $45 million
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| Shares: | 4.5 million
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| Greenshoe: | 675,000
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| Price: | $10.00
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| Pricing date: | Dec. 21, after close
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| Settlement: | Dec. 29
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| Bookrunner: | Jefferies & Co.
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| Listing: | "NCST" on Nasdaq National Market, "NCS" on Toronto Stock Exchange
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