September 11, 2009 (FinancialWire) — Prana Biotechnology (ASX: PBT) (NASDAQ: PRAN) has reached an agreement to raise $6 million (Australian) to support its R&D programs, to promote its drug development pipeline and to maintain corporate activities.

The funds come from an existing shareholder committed to Prana’s strategy to become a leader in the development of drugs to treat age related neurodegenerative diseases. Under the terms of the funding, Prana will issue 30 million ordinary shares ranking equally with the existing ASX listed ordinary shares (equivalent to 3 million ADRs on NASDAQ) at a price of 20 cents (Australian currency) per share. These shares, which are subject to limited price protection, will be issued without shareholder approval pursuant to the company’s allowance under ASX Listing Rule 7.1. The investor will also receive, subject to shareholder approval, 10 million free attaching options each to acquire 1 ordinary share at an exercise price of 30 cents and expiring 4 years from the date of issue of the abovementioned shares. The company will receive $5.7 million (Australian) net of all fees.

Prana’s lead Alzheimer’s Disease compound, PBT2, has already completed a Phase IIa study in early Alzheimer’s Disease patients and has demonstrated safety and tolerability. In addition, PBT2 showed significant improvement in Executive Function, an important aspect of cognitive performance, and reduced the levels of Abeta in the spinal fluid of patients. Abeta is a key protein associated with Alzheimer’s Disease.

Rodman & Renshaw, LLC, a wholly-owned subsidiary of Rodman & Renshaw Capital Group, Inc. (NASDAQ: RODM), and Peregrine Corporate (Melbourne) were advisors on the transaction.

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