Los Angeles Business Journal

CytRx Prices Stock Offering

By Deborah Crowe Thursday, October 18, 2012

Shares of CytRx Corp. on Thursday fell nearly 20 percent after the cancer drug developer priced a public offering of 8 million common shares at a comparable discount.

The West Los Angeles biotech, which now has a market cap of $53 million and 21 million shares outstanding, intends to use net proceeds to finance mid-stage clinical studies of two drug candidates and for general corporate purposes.

It expects gross proceeds of $20 million. The offering was priced at $2.50, 20 percent below Wednesday’s market close. Aegis Capital Corp. is managing the offering. CytRx granted it a 30-day option to purchase additional 1.2 million shares cover any over-allotments.

One of the drugs is being evaluated as a treatment for soft-tissue sarcomas, and the other is being considered to treat non-small lung cancer.

Shares closed down 61 cents, or 19.6 percent, to $2.50 on the Nasdaq.