Follow-on market softens

In the third clear sign in the past two days that the appetite for biotech shares is softening, drug discovery and cancer play TLRK sold only 1.875 million of a planned 3.75 million shares at $35.125, raising $65.9 million. Selling shareholders sold an additional 625,000 shares, having planned to offer 1.25 million shares. Had the company sold the original deal at its $80 price prior to the Feb. 23 filing, it would have raised $300 million. The follow-on was underwritten by Lehman Brothers; J.P. Morgan; Chase H&Q; Thomas Weisel Partners; and Warburg Dillon Read. TLRK was up $0.438 to $35.75 on Wednesday.

On Tuesday, combinatorial technology company Symyx (SMMX) withdrew its planned 1.25 million follow-on, citing market conditions and volatility. SMMX closed Wednesday at $49.25, up $2. Prior to proposing the offering on March 15, SMMX's stock price was $58. That volatility was further illustrated by the experience of gene shuffling play Maxygen (MAXY), which sold a 1.5 million-share follow-on on Tuesday at $97 per share. MAXY's stock price was $173.75 prior to its filing on March 3. The outlier is Enzon (ENZN), which raised $89 million through the sale of 2 million shares at $44.50 on Tuesday in its follow-on. ENZN's stock price was $51.375 prior to its filing on Feb. 22, and it closed Wednesday at $49. ...