MACROCHEM RAISES $9 MILLION IN PRIVATE EQUITY
PLACEMENT AND OBTAINS COMMITMENT FOR ADDITIONAL $7 MILLION
LEXINGTON, MA, OCTOBER 26, 2000 - MacroChem Corporation (NASDAQ: MCHM)
announced today that it raised $9 million in gross proceeds from a private
placement of its securities to two institutional investors. The investors have
committed to invest an additional $7 million at MacroChem's option seven months
after effectiveness of the required SEC registration statement and subject to
certain conditions including trading volume and price targets. Leerink Swann &
Co. of Boston acted as the placement agent.
Alvin J. Karloff, chairman and CEO commented, "The successful closing of
this transaction is a major milestone for the company. Our current cash position
and the committed future investment should enable us to focus on managing the
Phase 3 clinical development of Topiglan(R), our investigational drug for male
erectile dysfunction, continuing the clinical development of our EcoNail(TM)
product for fungal infections of the nail and exploring a number of new product
opportunities."
The company sold a total of 1,816,658 shares of its common stock.
Additional shares are issuable to the investors based on the trading price of
the common stock during the period following effectiveness of the registration
statement. The investors have certain rights of first refusal and other rights
during the same period. The investors also received five year warrants to
purchase a total of 363,332 shares of the company's common stock at a purchase
price of $5.90 per share. The company may call the warrants should the closing
price per share of its common stock reach $11.80 for 15 consecutive trading
days. The company has agreed to file a registration statement on form S-3 for
the common stock sold as well as the shares issuable upon exercise of the
warrants.
"In addition to providing the company with a strong cash position, this
financing accomplishes the first step of our overall objective of adding a
number of quality institutional investors to our shareholder group." Said
Kenneth L. Rice Jr., vice president and chief financial officer.
MacroChem is a pharmaceutical company based in Lexington, MA that
specializes in formulating drugs that can be administered through the skin.
Following a capital infusion of more than $20 million in 1998, the company
restructured itself from its contract R&D origins to develop proprietary drugs
based on its SEPA(R) technology. SEPA(R) temporarily neutralizes the
absorption-barrier effect of the outer lipid layer of mammal skin, known as the
stratum corneum.
MacroChem is currently conducting a 20-site, 460 patient pivotal phase 3
trial with Topiglan(R), its topical formulation of SEPA and Prostaglandin E1 for
treating male erectile dysfunction. In addition to Topiglan(R), MacroChem is
developing EcoNail(TM), a SEPA enhanced nail lacquer for delivering antifungal
agents through nails and surrounding tissues, for the 37 million Americans with
onychomycosis, a fungal infection of the fingernails or toenails.
TO THE EXTENT THAT THIS PRESS RELEASE DISCUSSES MATTERS RELATING TO THE
DEVELOPMENT OF FUTURE PRODUCTS, THESE ARE FORWARD-LOOKING STATEMENTS AND ARE
SUBJECT TO VARIOUS RISK FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THOSE EXPRESSED IN THE FORWARD-LOOKING STATEMENTS. THE RELEVANT
RISK FACTORS ARE SET FORTH IN MACROCHEM'S ANNUAL REPORT ON FORM 10-K AS FILED
WITH THE SEC AND INCLUDE, WITHOUT LIMITATION, RISKS REGARDING PRODUCT
DEVELOPMENT, CLINICAL TRIALS, DEPENDENCE ON THIRD PARTIES FOR DEVELOPMENT AND
LICENSING ARRANGEMENTS, AND RISKS INVOLVING REGULATORY APPROVAL OF PRODUCTS, AND
LICENSES AND PATENTS.
Visit our web site at: http://www.macrochem.com or http://www.mchm.com
