Bone Medical aims to raise $3.1 million

Bone disease biopharmaceutical company Bone Medical (ASX:BNE) has issued a prospectus with the aim of raising approximately AUD$3.1 million.

The company is offering just under 12 million shares at an issue price of $0.26 per share. The minimum subscription is $1 million. A free option is attached to each share allotted, exercisable 18 months from the date of issue, or before, at a price of $0.40.

Bone Medical shares were trading at $0.295 at the time of writing.

"The vast majority of the money is going to be used for the two lead products we have in the clinic. If you look at the rest of our pipeline, the costs are insignificant when compared to when you're conducting human clinical trials," said Bone Medical CEO Michael Redman. "There's also some general patent prosecution and general administrative cost."

Bone Medical's two lead products are Capsitonin, an oral calcitonin product, and Perthoxal, an oral parathyroid hormone product. Both are for osteoporosis.

"We just finished a phase I/II clinical trial for the calcitonin," said Redman. "For Perthoxal we've completed a phase I trial at St Vincent's hospital and we expect the final report sometime late October."

Redman also said that Bone Medical has a pre-IND (Investigational Drug Meeting) review meeting scheduled with the US Food and Drug Administration (FDA) in November. "That meeting will be for Capsitonin. To look at the number of trials, how many patients and verify the clinical endpoints which we believe is going to be related to bone marrow density and relevant biomarkers," he said.

Redman said that the next clinical trial is likely to be held in Brisbane using contract research organisation Clinical Network Services (CNS). "It makes sense to conduct trials in Australia because you've got an educated workforce, the quality is good, and quite honestly the costs are a little bit lower," he said.

The public offer closes on October 7 and is not underwritten.