Discovery Lab gets $60M in financing

Discovery Laboratories Inc. of Warrington said today that it had secured $60 million in financing from Kingsbridge Capital Limited by agreeing to sell common stock to the private investment group over three years.

The biotechnology company said the committed equity financing facility with the U.K.-based private investment group would provide cash to help promote Surfaxin, the company's first-ever drug, once it passes final regulatory hurdles.

Surfaxin has not yet been approved by the Food and Drug Administration. The drug would help prevent respiratory distress syndrome in premature infants.

Under the deal, Kingsbridge would purchase as much as 825,000 shares of common stock for $2.51 a share.

Discovery Labs shares were trading this morning for $1.75 on Nasdaq, up $0.05 from the previous close.

The Bucks County company had a deal with Kingsbridge Capital in 2004 for as much as $75 million in financing.

Discovery Labs announced May 2 that it had received a third "approvable" letter from the FDA, stating the remaining conditions for approval. The share price fell 50 percent that day, to $1.45.

The company announced the following Monday that the FDA would not require more clinical trials of the drug; the share price rebounded 31 percent to $1.90 that day.