Broken IPO NeurogesX Names BioMarin Pharma CEO as New Chairman

| About: NeurogesX, Inc. (NGSX)

On May 29, NeurogesX (NASDAQ:NGSX) named Jean-Jacques Bienaime as the Board of Director's new Chairman. Bienaime is the current chief executive and a director at BioMarin Pharmaceutical Inc. (NASDAQ:BMRN), a Novato, Calif., biopharmaceutical firm. Bienaime has been on NeurogesX's board since 2004.

On May 2, San Carlos-based biopharmaceutical company NeurogesX priced 4 million shares at $11 each in its initial public offering to raise $44 million.

The IPO priced well below its anticipated range of $13 to $15 per share, according to NeurogesX's prospectus

The company's shares fell 7 percent to close at $10.25 in their first day of trading on the Nasdaq Global Market. Since the IPO shares have traded down to a recent low of $7.55.

NGSX is focused on developing and commercializing novel pain management therapies. The company has assembled a portfolio of pain management product candidates and is developing new therapies based on known chemical entities.

The firms initial focus is on chronic peripheral neuropathic pain including postherpetic neuralgia, or PHN, painful HIV-distal sensory polyneuropathy, or HIV-DSP, and painful diabetic neuropathy, or PDN. Its most advanced product candidate, NGX-4010, a synthetic capsaicin-based topical patch designed to manage pain associated with peripheral neuropathic pain conditions, has completed two pivotal Phase 3 clinical trials that have met their primary endpoints, one in PHN and one in HIV-DSP.

The results demonstrated that a single 30 or 60 minute application of NGX-4010, depending on the indication, may provide at least 12 weeks of clinically-meaningful pain relief. The company expects to file a marketing authorization application, or MAA, in Europe for NGX-4010 in 2007 based upon existing clinical trial data. If the safety and efficacy of NGX-4010 are confirmed by two ongoing Phase 3 clinical trials, the firm will submit a new drug application, or NDA, in the United States in 2008.

NGSX is also developing a non-patch liquid formulation of synthetic capsaicin, NGX-1998, and an opioid analgesic for use in managing chronic pain.

Currently, the company has no products approved for commercial sale and it has not generated any revenues. NGSX holds all worldwide commercial rights to its product candidates and it is actively engaged in partnering discussions in anticipation of European product approval and launch.

Established in 1998, NeurogesX has reported no revenues to date, but reported net losses of $30.1 million for 2006, $13.1 million in 2005 and $21.3 million in 2004, according to the prospectus. NeurogesX has 37 employees.

Morgan Stanley & Co. acted as the lead manager for the offering. Pacific Growth Equities, Lazard Capital Markets and Susquehanna Financial Group acted as co-managers.

NGSX 1-mo chart


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