INVITRON VIGOROUSLY SEEKING ADDITIONAL CAPITAL

INVITRON VIGOROUSLY SEEKING ADDITIONAL CAPITAL through the efforts of an investment banking firm and a "Japanese trading company," the St. Louis-based biopharmaceutical R&D firm said March 22. Invitron noted that it is seeking additional funding through providing production services and licensing its proprietary product technology and products, and plans to reduce cash outflow by a "33% reduction in staffing levels, reductions in materials and supplies usage, and reductions in discretionary spending." The company issued the retrenchment statement in conjunction with its 1989 financial results, which showed revenues of $11.5 mil. and a net loss of $16.4 mil. Accompanying the financial data was a statement from the company's auditor, Deloitte & Touche, saying "conditions exist which raise substantial doubt" about the company's ability to continue if it cannot generate sufficient cash to meet operating costs. Invitron's financial position suffered a serious blow Feb. 9 when SmithKline Beecham, the supplier of 73.2% of Invitron's 1989 contract revenues, announced that it was halting development of soluble T4 in favor of second generation therapies ("The Pink Sheet" Feb. 12, "In Brief"). Invitron was the manufacturer of sT4, SmithKline's version of the experimental AIDS drug CD4, and said it will cease production of sT4 during the first half of 1990. Invitron "recently met" with majority owner Monsanto to seek additional capital. Noting that its interests have diverged from Invitron's biotech focus, Monsanto reaffirmed that it does not intend to increase its investment in Invitron and is looking to sell its equity interest. Invitron said it has begun negotiations with potential corporate investors to acquire Monsanto's stake. Monsanto owns 58.4%, or approximately 9.1 mil. shares, of the firm's outstanding stock, including stock indirectly owned through Alafi Capital. Monsanto licensed the proprietary cell culture which is the basis of Invitron's work to the company upon its founding in 1984. In 1988, Monsanto subsidiary Searle terminated its development and commercialization agreements for azurophil-derived bactericidal factor, a white blood cell-derived protein for antimicrobial activity, and modified its once-exclusive TPA licensing agreement with Invitron. In addition to its equity stake, Monsanto holds $14 mil. in secured convertible debentures and non-convertible secured debentures with a $1.5 mil. face value. The debentures are secured through first and second mortgage liens on Invitron's St. Louis production facility. In the immediate future, Invitron shortly will have at its disposal $4.3 mil. for operating purposes. SmithKline has agreed to remove restrictions on its funding that had been targeted at expanding Invitron's St. Louis plant. As a result, the $4.3 mil. in previously restricted funding will now be available for general corporate purposes, Invitron noted. SmithKline also has freed Invitron to manufacture soluble T4 and tissue plasminogen activator for other parties.