Clarus files for $86M IPO as cash run dries
This article was originally published in Scrip
Driving on fumes, Clarus Therapeutics, the US biopharmaceutical company, is turning to the public markets in attempt to bolster its finances. The company has filed plans to raise up to $86.25 million in an IPO after its cash and equivalents fell to just $483,000 at the end of September.
Clarus needs the funds to continue the late-stage development of its oral formulation of testosterone undecanoate OriTex to treat hypogonadal men.
Specfically, it will use the proceeds to fund a pivotal phase III trial of OriTex as well as a Phase IV trial. It will also fund the preparation and filing of an NDA with the US FDA for OriTex upon successful completion of the Phase III trial.
In its IPO prospectus, Clarus said that the financing should provide the company with funds for at least the next several years. However, given that its net loss in the first nine-months of this year reached $6.2 million, up from $4.0 million in the same period last year, it could face real difficulties early next year if investors prove unwilling to take part in the IPO.
Currently marketed oral testosterone-deficiency treatments include methyltestosterone, though this has been linked with liver toxicity. Clarus believes "there is a clear opportunity in the market for an orally effective testosterone product that safely restores serum testosterone to within the normal range".
Non-oral hypogonadism treatments currently available include ProStrakan's Tostran (testosterone gel), though this is only approved in Europe. In July, ProStrakan's partner Endo Pharmaceuticals submitted its response to the US FDA a the complete response letter it received in October last year for the NDA of Fortesta, as it will be known there (scripintelligence.com, 1 July 2010). The FDA has set a PDUFA date for Fortesta of 30 December 2010.
Clarus last raised money in a $8 million series C round in November 2007.