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Amarantus Bio Moves Into Orphan Disease Theranostics, Raises $5.5M

NEW YORK (GenomeWeb) – Amarantus Bioscience Holdings is moving into diagnostics for orphan diseases and today announced it has completed a $5.5 million fundraising round.

The firm's diagnostics division holds the rights to MSPrecise, a proprietary next-generation sequencing assay for identifying patients with relapsing-remitting multiple sclerosis at first clinical presentation; an exclusive worldwide license to the Lymphocyte Proliferation test for Alzheimer's disease; and the intellectual property for NuroPro, a Parkinson's disease diagnostic test.

The firm issued $2.75 million in Series H convertible preferred stock and another $2.75 million in secured debt in a private placement to a single institutional investor. Both the Series H and the newly issued secured convertible debt are convertible into Amarantus common stock at $2.50 per share, subject to adjustment based on market conditions, the firm said in a statement.

Amarantus has also exchanged $2.9 million in secured debt previously issued to Dominion Capital for notes issued in connection with the secured debt financing agreement announced today.

Furthermore, the firm issued approximately 3.8 million warrants to the Series H holders and secured debt holders, exercisable for five years with a fixed strike price of $2.00.

At closing, Amarantus simultaneously repurchased all of the remaining 1,260 outstanding Series G convertible shares with a face value of $6.3 million and 212,087 common shares held by Discover Growth Fund, for a total of $4.75 million in cash. In April, Discover Growth Fund invested $5 million in Amarantus. The fund ho longer holds any securities of Amarantus and is precluded from trading in the firm for two years.

"While adverse market conditions have persisted in the entire biotechnology sector, we remain committed to our goal of achieving a national exchange listing, and believe this transaction is a significant step forward in positioning Amarantus toward reaching that important objective," Amarantus CFO Robert Farrell said in a statement.

Aegis Capital served as placement agent for the private placement.