ATIS persuades investors not to wait

A dilemma that many companies face at some point in their development is the need to raise money in advance of a milestone. Especially in a soft financial market, the smart choice for investors often is to wait until results of a trial are known, rather than taking a chance on the outcome. Thus investors often choose to give away a few points of upside in exchange for more certainty and less downside.

Advanced Tissue Sciences Inc. overcame these objections in its recently announced $18 million private placement by structuring a deal that both protected investors and gave the company some upside if results are good (see BioCentury July 17). The company is in pivotal studies with its Dermagraft-TC transitional covering for severe burns and Dermagraft for diabetic foot ulcers, with PMA submissions targeted for 1996. ...