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Compugen Raises $19M Through Equity Offering

NEW YORK (GenomeWeb News) – Compugen said today that it raised net proceeds of $19 million through a previously announced equity offering.

As part of the offering, which was established in late October with Cantor Fitzgerald, Compugen sold approximately 4.1 million shares at a weighted average price of approximately $4.91 per share, resulting in $20 million in gross proceeds.

The shares were sold in the open market at prevailing prices from November 13 to December 29, Compugen said. After sales commissions and estimated offering expenses, net proceeds totaled $19 million, which Compugen said it will use for general corporate purposes.

In a statement, Compugen CFO Dikla Czaczkes Axselbrad said that including the net proceeds from the offering, Compugen expects to have cash resources at the end of 2009 of approximately $23 million, not including the approximately $4 million market value of its holdings of ordinary shares in Evogene.

Axselbrad also said that the company anticipates maximum gross cash usage of $8.5 million for 2010, which would be reduced by any revenues or other cash sources, including government or other grants, in calculating net cash usage for the year.

Tel-Aviv, Israel-based Compugen does not plan on providing revenue guidance for 2010 "in view of the fact that we anticipate that our major source of revenues in the short-term will likely be research revenues, licensing fees, and milestones," Axselbrad said.

However, the company's short-term financial target is to achieve cash flow breakeven by year-end 2011, based largely on research revenues under milestone and revenue-sharing collaboration agreements, he added.

Last week, Compugen announced that it had inked a deal with Pfizer to screen peptide candidates for three of Pfizer's drug targets, sending its shares soaring by 62 percent in next-day trading on Nasdaq.

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