$10 million placement.

It ain't over till the fat pill sings
By Rebecca Urban and Helen Westerman
June 9, 2005
Metabolic Pharmaceuticals has placed its shares in a trading halt as chief executive Roland Scollay travels interstate seeking $10 million to put the company's fat pill through its next phase of clinical trials.

The Melbourne biotech last week outlined plans for a 480-patient trial as a result of its phase II trial last year failing to identify the most effective dose for the drug.

Metabolic hired stockbroking and corporate advisory firm BBY to place a swag of shares priced around 61 ¢ to 63 ¢. Shares last closed at 69.5 ¢.

Full Disclosure is told that two cornerstone investors have committed to snapping up shares, while the rest will be placed with institutions and retail investors.

Australia's largest biotech investor, Queensland Investment Corporation, will likely pass up the offer given it dumped about 6.8 million shares last year.

Circadian Technologies already owns about 20 per cent of the company and sources reckon it would be reluctant to put more money in.

That leaves substantial holder Acorn Capital, which supported the last capital raising 12 months ago, as a possible buyer.
But should BBY struggle to get enough interest - Metabolic shares have fallen 50 per cent so far this year, after all - it might consider introducing wealthy client Richard Opara to the register.

Opara, as some readers may know, is the chairman of drug developer Avantogen, (formerly known as Australian Cancer Technologies), and, until yesterday, he also chaired the board of Polartechnics.

Opara, who is close to BBY chief executive Glenn Rosewall, has large shareholdings in both companies and has made it known that he is scouting for investments in the sector.