Oramed Pharmaceuticals Files to Raise $100 Million

Insulin tablet developer Oramed Pharmaceuticals Inc. (Nasdaq:ORMP) has published a draft prospectus to raise $100 million, six months after raising capital from Maxim Group LLC and Aegis Capital Corporation, which make frequent investments in small Israeli companies. In December, “Globes” reported that Oramed was considering dual listing on the Tel Aviv Stock Exchange (TASE).

Oramed has $23 million in cash, enough for its needs, but the prospectus will enable the company to exploit the sharp rise in its share price. The price quadrupled in the 20 days through January 10, after stagnating for months. It has since dropped 30% to $20 on Friday, giving a market cap of $159 million.

The rally was due to developments at the company: success in a Phase I Clinical Trial of oral insulin for Type 1 (juvenile) diabetes; expectations about the results of a Phase IIa Clinical Trial of its oral insulin for the larger Type II (adult onset) diabetes, due this week; $13 million raised from two private equity funds; rumors of a deal with Danish pharmaceutical company Novo Nordisk A/S (NYSE: NVO; OMX: NOVOB), which are denied by the latter; and several favorable analysts’ reports, which set target price of $27-30.

Oramed was founded by CEO Nadav Kidron on the basis of research by his mother, Prof. Miriam Kidron at Hebrew University of Jerusalem. It is one of the many companies, from start-ups to big pharma, that are racing to develop oral insulin, which will eliminate the need for injections, albeit only as a supplementary treatment.

The rise in Oramed’s share price has influenced small-cap DNA Biomedical Solutions Ltd. (TASE: DNA), which has licensed Oramed’s technology to develop a treatment for osteoporosis. Its share price has risen 60% in the past month to give a current market cap of NIS 49 million

Published by Globes [online], Israel business news – www.globes-online.com