AustCancer attracts $2m investment

US biotech company Bioaccelerate will invest AUD$1.88 million into Australian Cancer Technologies (AustCancer, ASX:ACU) through a private share placement of 4,893,301 ACU shares at $0.384 per share.

The investment comes with a commitment for a wider collaboration between the two companies, focusing on a new prostate cancer compound introduced by Bioaccelerate, and work on a pancreatic cancer drug recently acquired by AustCancer from German company RESprotect.

Bioaccelerate's prostate cancer project is based on two proteins -- calreticulin (EAF1) and TID1 -- which are downregulated in prostate cancer. Potential lead compounds, which modulate the expression or effectiveness of these two proteins, are being developed, with the aim of commencing Phase I clinical trials in 2005.

The placement is expected to be ratified at the company's AGM on November 4, 2004.

AustCancer is also planning to offer shareholders a non-renounceable rights issue one new share for every ten shares they hold as at October 18, 2004 at an issue price of $0.35 per share -- a 14.7 per cent discount to the one month volume weighted average price. The issue is expected to raise up to $4 million.