Shares of Fibrocell Science, Inc. (FCSC - Free Report) plunged 15.83% on Sep 26, 2013, after it announced the pricing of an underwritten public offering of 11,000,000 shares of its common stock at $4.10 per share.
The offer price of $4.10 per share was at a 17.8% discount to the closing price of $4.99 per share on Sep 25, 2013.
The offering is expected to close by Oct 1 and generate gross proceeds of $45.1 million.
Fibrocell will grant the underwriters a 30-day option to purchase up to an additional 1,650,000 shares to cover over allotments, if any.
Fibrocell intends to use the net proceeds from the stock offering to fund its phase III studies for additional indications for its currently marketed product, LAVIV.
We note that LAVIV, an autologous cellular product, is approved for use in adults for improvement of the appearance of moderate-to-severe nasolabial fold wrinkles.
The company is looking to expand the LAVIV label and assess the product for several indications including the treatment of restrictive burn scars (RBS). In May 2013, the company announced the initiation of a phase II study evaluating LAVIV for the treatment of RBS.
Fibrocell also plans to progress its collaboration programs with Intrexon Corporation (XON) and use the funds for working capital and general corporate and administrative expenses.
We note that Fibrocell is collaborating with Intrexon Corporation for the discovery and development of treatments for rare collagen deficient conditions such as recessive dystrophic epidermolysis bullosa and also autoimmune and inflammatory disorders such as morphea (localized scleroderma), cutaneous eosinophilias and moderate to severe psoriasis.
Fibrocell Science currently carries a Zacks Rank #3 (Hold). Right now, companies that look attractive include Actelion Ltd. and Affymetrix Inc. . Both carry a Zacks Rank #1 (Strong Buy).