BioSante Pharmaceuticals Inc. said Tuesday it closed a direct sale of stock and options to two institutional investors, raising $17.5 million.

On Thursday, the company said Great Point Partners LLC and Deerfield Management Company would buy a total of 10.4 million shares and warrants to buy another 5.2 million shares. The firms paid $18 million, with about $500,000 going to cover expenses.

BioSante sold the stock in the form of units. Each unit consists of one share, and a warrant to buy another half share. The units sold for $1.73 each, matching the closing price the day before the offering was announced.

The exercise price of the warrants is $2.08 per share. They can be exercised starting in six months. BioSante had 53.2 million shares on the market as of Nov. 1, which means the offering could increase its share count by about 29 percent.

Net proceeds of $17.5 million will be used to fund development of BioSante's LibiGel, which is intended to treat sexual dysfunction in women. LibiGel is a testosterone gel applied to the skin. It will also use the money to seek opportunities for its cancer drugs and other technologies.

Great Point and Deerfield were not investors in BioSante before the registered direct offering. Rodman & Renshaw was the placement agent for the offering.

BioSante shares fell 8 cents, or 4.4 percent, to $1.72 in afternoon trading. The stock has traded between $1.13 and $2.70 over the last 52 weeks.