Arrowhead Pharmaceuticals Closes Underwritten Offering with Gross Proceeds of $450.0 Million

Rhea-AI Summary

Arrowhead Pharmaceuticals, Inc. (ARWR) closed an underwritten registered offering of 15,790,000 shares of its Common Stock at $28.50 per share, generating approximately $450.0 million in gross proceeds. The company intends to allocate the net proceeds for research and development, general corporate expenses, and working capital needs.

Insights

Financial Analyst

The closure of Arrowhead Pharmaceuticals' underwritten registered offering marks a significant capital infusion for the company. With gross proceeds of approximately $450 million, this capital raise is poised to enhance the company's financial flexibility. It's important to note the offering price of $28.50 per share, which can be indicative of market sentiment towards the company's valuation. Investors should consider the dilutive effect of the additional 15,790,000 shares on existing shareholders. However, the influx of capital often outweighs dilution concerns if it leads to advancements in research and development that can drive future growth.

Considering the role of prominent financial institutions as bookrunners and advisors, the offering likely had a strong backing and was well-received in the market. This can be a positive signal to investors about the institutional confidence in Arrowhead's growth trajectory and the potential of its pipeline. The allocation of proceeds towards R&D is typical for biopharmaceutical firms, where continuous innovation is critical. Investors will be watching how effectively Arrowhead deploys this capital to advance its drug candidates and whether it can meet its strategic objectives, which can have a significant impact on its future revenue streams and market position.

Medical Research Analyst

Arrowhead Pharmaceuticals' decision to allocate a substantial portion of the net proceeds towards research and development is a strategic move in the highly competitive biopharmaceutical industry. The company's focus on RNA interference (RNAi) therapeutics is a cutting-edge area of medical research with the potential to treat a wide range of diseases by silencing specific genes. The funding could accelerate the development of their pipeline, which may include preclinical and clinical stage products.

For stakeholders, the key interest lies in the progress of these R&D efforts. The success or failure of clinical trials can drastically alter a company's fortune. Therefore, the efficiency and outcome of the R&D investments from this capital raise are critical. The long-term implications hinge on the company's ability to bring viable therapeutics to market, which would not only benefit patients but also potentially deliver significant returns to investors through new revenue streams and partnerships.

Market Research Analyst

From a market perspective, Arrowhead's recent capital raise through an underwritten registered offering is a strategic maneuver that could reshape its competitive standing. The biopharmaceutical sector is driven by innovation and the ability to sustain long-term R&D investments. Arrowhead's financial decision to bolster its working capital through this offering indicates a proactive approach to funding its research endeavors without relying excessively on debt, which could be favorable for its risk profile.

Market analysts will be keenly observing how the company's stock price stabilizes post-offering, as the initial dilution effect may be offset by positive investor sentiment if the R&D initiatives show promise. Furthermore, the involvement of high-profile underwriters and capital markets advisors could enhance investor confidence, potentially impacting the stock's liquidity and attractiveness to both institutional and retail investors. The long-term market impact will largely depend on the tangible outcomes of the R&D efforts funded by this offering.

PASADENA, Calif.--(BUSINESS WIRE)-- Arrowhead Pharmaceuticals, Inc. (NASDAQ: ARWR) today announced that on January 5, 2024, it closed the previously announced underwritten registered offering of 15,790,000 shares of its common stock, par value $0.001 per share (“Common Stock”). The offering was priced at $28.50 per share, and the company received gross proceeds of approximately $450.0 million, before deducting underwriting discounts, commissions and other offering expenses payable by the company.

Jefferies, BofA Securities and TD Cowen acted as bookrunning managers for the offering. Piper Sandler and RBC Capital Markets acted as capital markets advisors for the offering. Arrowhead intends to use the net proceeds from this offering for research and development, general corporate expenses and working capital needs.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.

About Arrowhead Pharmaceuticals

Arrowhead Pharmaceuticals develops medicines that treat intractable diseases by silencing the genes that cause them. Using a broad portfolio of RNA chemistries and efficient modes of delivery, Arrowhead therapies trigger the RNA interference mechanism to induce rapid, deep, and durable knockdown of target genes. RNA interference, or RNAi, is a mechanism present in living cells that inhibits the expression of a specific gene, thereby affecting the production of a specific protein. Arrowhead’s RNAi-based therapeutics leverage this natural pathway of gene silencing.

Safe Harbor Statement under the Private Securities Litigation Reform Act:

This news release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements regarding our expectations with respect to the registered offering and the anticipated use of proceeds from the registered offering. These statements are based upon our current expectations and speak only as of the date hereof. Our actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of numerous factors and uncertainties, including, without limitation, risks and uncertainties related to market conditions and the other risks and uncertainties described in our most recent Annual Report on Form 10-K and other documents filed with the SEC from time to time. Readers are cautioned not to place undue reliance on these forward-looking statements. We assume no obligation to update or revise forward-looking statements to reflect new events or circumstances.

Source: Arrowhead Pharmaceuticals, Inc.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240105913237/en/

Arrowhead Pharmaceuticals, Inc.

Vince Anzalone, CFA

626-304-3400

ir@arrowheadpharma.com

Investors:

LifeSci Advisors, LLC

Brian Ritchie

212-915-2578

britchie@lifesciadvisors.com

www.lifesciadvisors.com

Media:

LifeSci Communications, LLC

Jason Braco, Ph.D.

646-751-4361

jbraco@lifescicomms.com

www.lifesciadvisors.com

Source: Arrowhead Pharmaceuticals, Inc.

FAQ

What did Arrowhead Pharmaceuticals, Inc. (ARWR) announce?

Arrowhead Pharmaceuticals, Inc. (ARWR) announced the closing of an underwritten registered offering of 15,790,000 shares of its Common Stock.

How much was the offering priced at?

The offering was priced at $28.50 per share.

How much gross proceeds did the company receive?

The company received approximately $450.0 million in gross proceeds.

What are the intentions for the net proceeds from the offering?

Arrowhead Pharmaceuticals, Inc. (ARWR) intends to use the net proceeds for research and development, general corporate expenses, and working capital needs.