Aeolus Pharmaceuticals (OTCBB:AOLS), a biotechnology company developing compounds to protect against fibrosis, inflammation, nerve damage and infection, is to raise US$6.75mln through a private placement.
Both existing and new investors in the company will be acquiring the shares, including entities associated with BVF Partners, a leading life sciences investment firm, which manages the Biotechnology Value Fund family of funds (BVF).
Aeolus intends to use the funds from the share issue for general corporate and working capital purposes, including the development of AEOL 10150 as a medical counter-measure for the pulmonary effects of acute radiation syndrome, under the company's development contract with the Biomedical Advanced Research and Development Authority (BARDA).
In addition, the company intends to use the proceeds to pursue human clinical trials with AEOL 10150 in Idiopathic pulmonary fibrosis and radiation oncology and the completion of pre-clinical development of AEOL 20415 for infectious diseases and AEOL 11114B for Parkinson's disease.
The new shares have been issued at 22 cents a share, four cents below Friday's closing share price.