Alzamend Neuro Announces Termination of At-the-Market Equity Offering Program

Rhea-AI Summary

Alzamend Neuro, Inc. (ALZN) terminated its 'at-the-market' equity offering program to limit uncertainty and unfavorable dilution for its stockholders. The company had sold over 1 million shares and raised about $1.3 million. The termination will be effective on May 16, 2024, with no further sales planned under the program.

Positive

• None.

Negative

• Terminating the equity offering program could limit potential funding sources for future projects or operations, impacting the company's financial flexibility.

Insights

Financial Analyst

The cessation of Alzamend Neuro's at-the-market equity offering program is a strategic financial move, signifying the company's intent to prevent further dilution of shareholder value. Dilution can decrease an individual shareholder's stake in the company and potentially reduce earnings per share, which is a critical concern for investors. However, terminating an equity offering also means that the company is cutting off a previously available stream of capital, which could signal a shift in its funding strategy. The funds raised through this program amounted to around $1.3 million, which translates to a modest average of $1.20 per share. This sum, while helpful, might not have a significant impact on the company's ability to finance its ongoing clinical trials or operations, depending on its burn rate and cash reserves. Investors might interpret this termination as a positive step towards more prudent fiscal management or a red flag indicating potential funding issues. It is also worth considering how the company plans to secure necessary funds moving forward, as this will have a direct impact on its capacity to achieve its developmental milestones.

Biotech Market Analyst

From a market dynamics perspective, Alzamend Neuro's termination of its at-the-market equity offering could be perceived differently by various market participants. For a clinical-stage biopharmaceutical company, consistent access to capital is vital for the advancement of its product pipeline. In the biotech industry, where the development process is lengthy and capital-intensive, a company's decision to halt a funding mechanism can raise questions about its long-term strategy and current financial health. The average price per share of approximately $1.20 indicates a relatively low investor appetite for the offering, which could have influenced the decision to terminate. Additionally, the capital raised might be considered insignificant in the context of the overall funding needed to bring products through clinical trials and to market. Investors would do well to monitor Alzamend's subsequent fiscal approaches, looking for partnerships, alternative financing arrangements or further capital raising efforts, which can provide insights into the company's strategic direction and market confidence.

ATLANTA--(BUSINESS WIRE)-- Alzamend Neuro, Inc. (Nasdaq: ALZN) (“Alzamend”), a clinical-stage biopharmaceutical company focused on developing novel products for the treatment of Alzheimer’s disease (“Alzheimer’s”), bipolar disorder (“BD”), major depressive disorder (“MDD”) and post-traumatic stress disorder (“PTSD”), announced today that it has terminated its “at-the-market” equity offering program relating to sales of common stock (“ATM Facility”) with Ascendiant Capital Markets, LLC, as sales agent (the “Agent”). The Company elected to terminate the ATM Facility to limit uncertainty and unfavorable dilution for its stockholders.

Although the Company initiated the 10-day termination process of the ATM Facility with the Agent, with the official termination to take effect on May 16, 2024, the Company will make no further sales of shares of its common stock under the ATM Facility. Upon termination, the Company will have no further obligations related to the ATM Facility. Upon the announcement of the initiation of the ATM Facility’s termination process, the Company had sold an aggregate of 1,076,821 shares of common stock and raised approximately $1.3 million in gross proceeds, or approximately $1.20 per share.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of shares of the Company’s common stock in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.

For more information on Alzamend, stockholders, investors, and any other interested parties may read Alzamend’s public filings and press releases available under the Investor Relations section at https://www.alzamend.com/ or available at https://www.sec.gov/.

About Alzamend Neuro

Alzamend Neuro is a clinical-stage biopharmaceutical company focused on developing novel products for the treatment of Alzheimer’s, BD, MDD and PTSD. Our mission is to rapidly develop and market safe and effective treatments. Our current pipeline consists of two novel therapeutic drug candidates, AL001 - a patented ionic cocrystal technology delivering lithium via a therapeutic combination of lithium, salicylate and L-proline, and ALZN002 - a patented method using a mutant-peptide sensitized cell as a cell-based therapeutic vaccine that seeks to restore the ability of a patient’s immunological system to combat Alzheimer’s. Both of our product candidates are licensed from the University of South Florida Research Foundation, Inc. pursuant to royalty-bearing exclusive worldwide licenses.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “believes,” “plans,” “anticipates,” “projects,” “estimates,” “expects,” “intends,” “strategy,” “future,” “opportunity,” “may,” “will,” “should,” “could,” “potential,” or similar expressions. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties. Forward-looking statements speak only as of the date they are made, and Alzamend undertakes no obligation to update any of them publicly in light of new information or future events. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors. More information, including potential risk factors, that could affect Alzamend’s business and financial results are included in Alzamend’s filings with the U.S. Securities and Exchange Commission. All filings are available at www.sec.gov and on Alzamend’s website at www.Alzamend.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240507349564/en/

Email: Info@Alzamend.com or call: 1-844-722-6333

Source: Alzamend Neuro, Inc.

FAQ

Why did Alzamend Neuro terminate its 'at-the-market' equity offering program?

Alzamend Neuro terminated the program to limit uncertainty and unfavorable dilution for its stockholders.

How much did Alzamend Neuro raise through the equity offering program?

Alzamend Neuro raised approximately $1.3 million by selling over 1 million shares of common stock.

When will the termination of the equity offering program take effect?

The termination of the program will be effective on May 16, 2024, with no further sales planned under the program.