Bothell biotechnology company Nastech said it is raising $7.9 million, but the deal's terms sent its shares plummeting 36 percent.

Share story

Nastech Pharmaceutical shares plummeted Friday after the company announced it was raising $7.9 million through an equity offering to unidentified new and existing investors.

The Bothell company’s stock fell 78 cents, or 36 percent, to $1.40 in mid-day trading.

Nastech agreed to sell 4.6 million shares to investors at $1.73 per share. Investors will also receive 7-year warrants to purchase an additional 4.6 million shares of stock, beginning October 25. The buyers can also buy up to $3 million in additional shares for a 90-day period starting that same day.

The company, which has recently sought to cut costs after the collapse of a lucrative research partnership with Procter & Gamble, said it expects the transaction to close today.