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Oxygen Biotherapeutics to raise $4.6 million

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Oxygen Biotherapeutics plans to raise $4.6 million from an undisclosed institutional investor.

The Morrisville company expects to use the proceeds to continue work on dermatology and cosmetics products. Oxygen is developing and marketing various products that are designed to repair damaged tissue by increasing the delivery of oxygen to the site.

The company's line of Dermacyte skin products is designed to reduce fine lines and wrinkles.

Oxygen also has received a $2 million, two-year grant from the U.S. Army to study the use of its technology to treat traumatic brain injury.

As with other development-stage companies in this region, Oxygen is losing money as it spends millions to develop and test new products. The company lost $7.6 million for the nine months ended Jan. 31. Total revenue during that period was $58,825.

The latest financing is in the form of a convertible note that carries a 15 percent interest rate. The note is convertible into common stock at a price of $2.255 per share.

Oxygen's shares rose 31 cents today to $3.01, and have jumped more than 50 percent this year.

Oxygen CEO Chris Stern moved the company to Durham from California about two years ago. In March, Oxygen moved into about 6,000 square feet near Raleigh-Durham International Airport.

Oxygen employs 24 people.

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About the blogger

Assistant Business Editor Alan M. Wolf joined the N&O in 1999 covering the business of health care. He became an editor in 2001, and helps oversee the paper's daily business coverage and Sunday Work&Money section. He lives in Clayton with his wife and two children. Reach him at 919-829-4572 or e-mail him.