The net proceeds from this offering will be used for clinical development of existing product candidates and other general corporate purposes. The closing of the transaction is expected to occur in approximately one week. The exchangeable preferred stock will automatically be exchanged for common stock upon shareholder approval, subject to certain conditions.
Neurogen has also reduced its workforce by approximately 45 positions in research and administrative functions, as part of an initiative to focus resources on advancing the company’s four clinical programs in insomnia, anxiety, restless legs syndrome (RLS), and Parkinson’s disease.
Stephen Davis, president and CEO of Neurogen, said: “This financing, together with our cash and marketable securities of $42.6 million as of December 31, 2007 and the operational changes announced today, enable us to get to important clinical milestones in our insomnia, anxiety, Parkinson’s disease and RLS programs in 2008 and to fund our planned operations into the second half of 2009.”