Bionomics raises $6m for drug development

Adelaide-based epilepsy specialist Bionomics (ASX:BNO), US OTC:BMICY) has raised AUD$6 million in additional capital to fast-track its drug-discovery for new drugs to treat epilepsy and anxiety disorders.

Bionomics announced this week it has completed a placement of approximately 12.46 million ordinary shares at a discounted price of 32c each, to raise approximately $4 million from its participating investor institutions and other major shareholders -- including one new overseas investor.

For the balance of $2 million, Bionomics is offering all qualifying shareholders an entitlements issue of shares at the same 32c price -- a 15.4 per cent discount on the three-day average closing price of the company's shares on the Monday, February 23 date of issue. For every two shares bought, shareholders will be entitled to exercise an attached option to purchase one extra 50c share up until February 31, 2007.

Bionomics CEO Dr Deborah Rathjen said the funds raised would accelerate the company's drug-discovery program based on the GABA receptor.

The neurotransmitter gamma-amino butyric acid (GABA) is a key regulator of neural excitatory processes in the brain. Bionomics researchers investigating the genetic basis of inherited epilepsy have shown that certain forms of epilepsy arise in mutations in genes encoding the three sub-unit proteins -- alpha, beta and gamma -- that collectively form the cell-surface 'switches' activated by GABA.

Rathjen said the GABA receptor is the molecular target for some current epilepsy drugs, and for the benzodiazepine drugs used to treat anxiety disorders. Benzodiazepines are relatively slow-acting, they have possibly adverse side-effects including drowsiness, and are also said to be addictive with chronic use.

Bionomics is using its genomics-driven drug-discovery platform, IonX to identify compounds that may be more effective and specific in their actions.

The company is also using its proprietary knock-in mouse model of human epilepsy to test candidate molecules. The transgenic mouse, developed by Dr Steve Petrou at Melbourne University, has a GABA receptor gamma-2 sub-unit mutation that replicates the symptoms of absence epilepsy in humans.

"Our capital raising has attracted a great deal of interest, and is being completed fairly quickly," Rathjen said. "We've received a lot of support from our current major investors."

Asked if the company's IonX program had identified any promising compounds for treating epilepsy or anxiety, Rathjen advised investors to "Stand by until the end of the year".