Ebb & Flow

With capital markets tight, biotech companies are looking for non-dilutive ways to guarantee access to new funds should they need them. Last week, Micromet (NASDAQ:MITI) and Newron (SWX:NWRN) both secured equity agreements that provide them with access to working in the coming two to three years. Cancer, inflammation and autoimmune company Micromet has the option to draw on $75 million from Kingsbridge Capital, while CNS and inflammation company Newron has access to up to CHF30 million ($24.8 million) from YA Global Investments.

Neither company is strapped for cash, but both see the deals as strengthening their future negotiating positions with potential partners as well as providing financial security in the coming years. Micromet recently completed a PIPE that raised $40 million (see BioCentury, Oct. 6). Newron still has about $50 million in the bank from its 2006 IPO, which raised CHF118.1 million ($97.5 million) (see BioCentury, Dec. 11, 2006). ...