Cell Therapeutics selling $60M in preferred stock

SEATTLE -- Cell Therapeutics Inc. said Friday it plans to sell $60 million in preferred stock to raise money for the launch of its lymphoma drug Pixuvri and to fund studies of its drug pacritinib as a treatment for myelofibrosis.

Its common shares fell to a new all-time low on the news.

Cell Therapeutics said that it will sell preferred stock for $1,000 per share. Each preferred share can be converted into 714 shares of stock with a conversion price of $1.40 per share.

If all the shares are converted, that would translate to 42.9 million shares.

The company said it expects to raise $55.6 million after expenses.

Cell Therapeutics plans to use the funds to begin marketing of Pixuvri in Europe and to start trials of pacritinib in myelofibrosis, a disease that causes red blood cells to build up inside bone marrow and slows the production of healthy blood cells. It is also studying the drug as a treatment for lymphoma.

Other funds will be used for purposes including research and development funding, clinical and preclinical trials, and the regulatory process.

Cell Therapeutics had 283.4 million shares on the market as of July 30.

Its stock dropped 44 cents, or 21.6 percent, to $1.60 in morning trading after falling as low as $1.42 earlier in the session. That was its lowest level ever, according to FactSet.