TorreyPines Therapeutics, Inc. (TPTX) Buzz Stock of the Day

Shares of TorreyPines Therapeutics, Inc.(NASDAQ: TPTX) skyrocketed more than 261 percent in morning trading after proposed merger candidate, Raptor Pharmaceuticals, Inc. (OTCBB: RPTP) announced it raised $5 million through a private placement offering. A portion of the proceeds would be used to close a merger with TorreyPines, which was announced in late July.

Raptor raised $2.6 million in a private placement and another $2.4 million in a warrant exchange. The company sold 7.5 million units (each a share of stock and a warrant to buy another half share). It also raised about $2.4 million by exchanging warrants from a previous private placement in 2008 for new warrants. Proceeds will also be used to fund late-stage drug development and commercialization.

Under terms of the agreement, Raptor will be merged with and into a wholly owned subsidiary of TorreyPines, and TorreyPines will issue its common stock to Raptor stockholders. TorreyPines stockholders will own about 5 percent in the combined company, which will be named Raptor Pharmaceuticals, the companies said. The merger is expected to complete in the fourth quarter of 2009, dependent on the review process by regulatory agencies.

Additionally, TorreyPines will implement a reverse stock split to ensure compliance with Nasdaq listing requirements, and the size of the split will be determined at closing.

Raptor CEO, Christopher Starr will be the CEO of the combined company. TorreyPines CEO Evelyn Graham, CFO Craig Johnson, and Vice President Paul Schneider will remain with the combined company under new employment contracts that expire in 2010. TorreyPines directors have agreed to quit when the deal is closed.

TorreyPines’ products under development include Tezampanel, which completed Phase II clinical trial for the treatment of migraine; and NGX426, which completed Phase I clinical trial for the treatment of migraine and neuropathic pain. It also develops NGX267, a Phase II clinical trial product for the treatment of Xerostomia; and a Gamma-secretase modulator drug discovery program as a treatment for Alzheimer s disease. The company has a strategic alliance and licensing agreements with Eisai Co., Ltd.; Eli Lilly and Company; Life Science Research Israel, Ltd.; and University of Iowa Research Foundation.

Tags: buzz stocks, therapeutics, TPTX

This entry was posted on Wednesday, August 26th, 2009 at 9:44 pm by Sheryl and is filed under Health Care Stocks. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.