Friday, August 1, 2008

NxStage closes second tranche of $43M private placement

By Mass High Tech Staff

Dialysis technology maker NxStage Medical Inc. says that it has completed its previously announced $43 million private placement financing of common stock and warrants.

The private placement was closed in two tranches. The initial closing occurred on May 28, 2008, when NxStage issued 5.5 million shares of common stock and 1.9 million warrants to OrbiMed Advisors LLC for gross proceeds of $25 million.

The warrants can be converted into NxStage (Nasdaq:NXTM) common stock at an exercise price of $5.50 per share, but that price may be adjusted to $3 or $6.50, depending upon whether the company achieves certain targets relating to the number of End Stage Renal Disease patients prescribed to receive therapy with the NxStage System One as of December 31, 2008.

The second closing was subject to the approval of NxStage stockholders, which was obtained at a special meeting of stockholders held on July 3, according to company officials. At the second closing, the company issued 4 million shares of common stock and 800,000 warrants and received gross proceeds of $18 million.

NxStage reports it will use proceeds to advance the commercial reach of its products and the development of new products for its product pipeline, as well as for general corporate purposes.

NxStage makes products for the treatment of end-stage renal disease and acute kidney failure. The company reported a $58.4 million loss for 2007, on revenue of $60 million.