(Yicai Global) Dec. 6 -- Beijing Northland Biotechnology plans to raise CNY300 million (USD47.1 million) in a private placement of shares to help accelerate the development of new medicines, making the Chinese drug developer the first company listed on the newly opened Beijing Stock Exchange to raise funds through a non-public offering.

Northland will issue up to 32 million shares, or around 12.4 percent of total share capital, at a still-to-be determined price to specific investors, the Beijing-based biopharmaceutical firm said on Dec. 3. The proceeds will be used on drug R&D and to replenish working capital, it added.

The company, whose main products have yet to bring in revenue, is urgently looking to raise cash to develop 13 drugs related to cardiovascular disease, cancer and other ailments, it said. The firm logged losses of CNY37.9 million (USD6 million) in the first three quarters and CNY25.4 million last year.

After the private placement, Chairman and General Manager Xu Songshan and his brother Xu Rishan’s combined stake will fall to 22.78 percent from 25.61 percent, but they will remain the biggest shareholders.

Northland, which used to be listed on the National Equities Exchange and Quotations which is an over-the-counter market in Beijing also known as the New Third Board, was one of the first firms to list on the Beijing bourse when it opened on Nov. 15.

Northland’s share price [BSE:430047] was trading down 6 percent at CNY17.20 (USD2.70) apiece as of 2:25 p.m. China time today, giving it a market capitalization of CNY4.4 billion (USD690.4 million).

Editor: Kim Taylor