(Adds details about drugs, fundraising strategy, market reaction)
By John Miller
ZURICH, July 11 (Reuters) - Swiss drugmaker Idorsia’s Chief Executive Jean-Paul Clozel on Wednesday accelerated fundraising for his drug pipeline, reaping around 505 million Swiss francs ($509 million) by selling new shares and convertible bonds.
Clozel had told Reuters this year he would likely wait until 2019 to begin augmenting the roughly $1 billion in cash he has after spinning Idorsia off from Actelion, which he sold in 2017 to Johnson & Johnson.
He opted to head to the markets more quickly, raising 305 million francs from the sale of 11.9 million new shares, priced at 25.62 francs per share, and 200 million francs from the sale of six-year bonds convertible into shares at a price of 33.95 francs per share.
Clozel is boosting his cash pile by about 50 percent just as he begins costly Phase III trials for four prospective medicines: DORA against insomnia, hypertension treatment Aprocitentan, stroke drug Clazosentan, and Lucerastat for rare Fabry disease.
While he previously said fundraising was unlikely to start this year, he struck swiftly after voicing concern that waiting too long and burning through his existing reserves would leave Idorsia vulnerable to unfavourable terms.
“If you are at the end of the road in terms of money, people can hold you hostage,” he said in an interview in May.
The shares were sold at a roughly 5 percent discount to Idorsia’s closing price on Tuesday of 26.96 francs. The stock, which has more than doubled since starting trade in 2017, was indicated down 3.5 percent before the market opens at 0700 GMT.
Clozel and his wife, Chief Scientific Officer Martine Clozel, bought 28.4 percent of both the shares and bonds to maintain their current ownership in Idorsia.
Analysts from Deutsche Bank have projected the top four assets in Idorsia’s pipeline could eventually reap peak annual sales of $4 billion, though they still must win approval from regulators.
Credit Suisse and Goldman Sachs were joint bookrunners while Octavian was selling agent for the placements.
$1 = 0.9922 Swiss francs Reporting by John Miller; Editing by Michael Shields