Announces Pricing of $5.0 Million Registered Direct Offering and Concurrent Private Placement
Biodexa Pharmaceuticals PLC (Nasdaq: BDRX) has announced a $5.0 million registered direct offering and concurrent private placement. The company will sell 5,050,808 American Depositary Shares and 278,975 pre-funded warrants at $0.94 per share. Additionally, Biodexa will issue unregistered Series J and K warrants in a private placement. The proceeds will fund development programs, including a final match payment for a $17 million CPRIT grant and initiation of a Phase 3 clinical trial of eRapa in Familial Adenomatous Polyposis (FAP). The offering is expected to close around July 22, 2024. Ladenburg Thalmann & Co. Inc. acted as the sole placement agent.
- Secured $5.0 million in funding through registered direct offering and private placement
- Proceeds to fund final match payment for $17 million CPRIT grant
- Funds to initiate Phase 3 clinical trial of eRapa in FAP
- Potential dilution of existing shareholders due to new share issuance
- Issuance of additional warrants may lead to further dilution if exercised
- Amended exercise price of existing warrants to $1.00 per share, potentially increasing dilution
Insights
Biodexa Pharmaceuticals' recent announcement of a
From an investment perspective, the dilution effect is a key concern. The issuance of an aggregate of 5,050,808 American Depository Shares and 278,975 pre-funded warrants will increase the number of shares outstanding, potentially diluting existing shareholders' value. However, the long-term benefits might outweigh the short-term dilution if the funds are used effectively for clinical advancements and operational needs.
It is worth noting that the exercise prices for the new warrants are set at
A major positive takeaway is that the company is taking steps to secure a strong financial future by advancing its drug pipeline, which if successful, could lead to significant returns. However, this is contingent on clinical trial success and prudent fund management.
The re-pricing of existing series E, G and H warrants to
For retail investors, understanding the dynamics of this offering is essential. Biodexa Pharmaceuticals is positioning itself to attract institutional investors while trying to ensure long-term growth through strategic funding. The decision to engage in a registered direct offering alongside a private placement allows the company to access immediate capital without going through the more cumbersome public offering process.
The terms of the pre-funded warrants and the new Series J and K warrants are worth noting. Pre-funded warrants with an exercise price of
Retail investors should be aware of the impact on the stock's liquidity and potential price volatility as new shares enter the market. These aspects are important in assessing short-term stock performance. Moreover, the concurrent private placement suggests a level of interest from sophisticated investors who see value in the company’s long-term prospects despite the immediate dilution.
Understanding these nuances can help retail investors make more informed decisions about the potential risks and opportunities present in Biodexa’s recent moves.
From a pharmaceutical industry perspective, Biodexa Pharmaceuticals is making strategic moves to ensure it stays competitive in a challenging market. The planned use of the
Familial Adenomatous Polyposis (FAP) is a rare but significant condition and successful development of eRapa can place Biodexa at the forefront of treatments for this disease, potentially leading to exclusive market opportunities and strong patent protection. This can translate into substantial revenue streams if regulatory approvals are achieved.
The alignment with the Cancer Prevention Research Institute of Texas also enhances Biodexa’s credibility and access to additional resources, which is a significant positive. However, investors should be cautious about the inherent risks associated with clinical trials, including potential delays or failures, which can impact the projected timelines and financial outcomes.
Overall, the strategic focus on leveraging grants and advanced-stage clinical trials indicates a well-planned approach that, if successful, can lead to significant long-term rewards for the company and its investors.
July 19, 2024
Biodexa Pharmaceuticals PLC
Announces Pricing of
Biodexa Pharmaceuticals PLC (“Biodexa” or the “Company”) (Nasdaq: BDRX), an acquisition-focused clinical stage biopharmaceutical company developing a pipeline of innovative products for the treatment of diseases with unmet medical needs, today announced that it has entered into definitive agreements with certain institutional investors to sell an aggregate of (i) 5,050,808 American Depositary Shares (the “Depositary Shares”) (each Depositary Share representing 400 of the Company’s ordinary shares, nominal value
The gross proceeds from the offering are expected to be approximately
In a concurrent private placement, the Company has also agreed to issue and sell unregistered Series J warrants to purchase up to an aggregate of 5,329,783 Depositary Shares (the “Series J Warrants”) and unregistered Series K warrants to purchase up to an aggregate of 5,329,783 Depositary Shares (the “Series K Warrants”). The offering is expected to close on or about July 22, 2024, subject to the satisfaction of customary closing conditions.
The pre-funded warrants have an exercise price of
Ladenburg Thalmann & Co. Inc. acted as sole placement agent in connection with the offering.
In connection with the offering, the Company has also agreed to amend the exercise price of existing Series E warrants to purchase an aggregate of 978,233 Depositary Shares, existing Series G warrants to purchase an aggregate of 2,443,995 Depositary Shares and existing Series H warrants to purchase an aggregate of 3,236,345 Depositary Shares that were previously issued in December 2023, May 2022 and May 2022, respectively, held by investors participating in the offering, such that, effective upon the closing of the offering, the amended warrants will have an exercise price of
The Depositary Shares (or pre-funded warrants in lieu thereof) are being offered pursuant to a shelf registration statement on Form F-3 (File No. 333-267932), which was declared effective by the United States Securities and Exchange Commission (“SEC”) on October 26, 2022. A prospectus supplement relating to the Depositary Shares and pre-funded warrants will be filed with the SEC and will be available on the SEC’s website located at http://www.sec.gov. Electronic copies of the prospectus supplement relating to the registered direct offering, together with the accompanying prospectus, may be obtained, when available, from Ladenburg Thalmann & Co. Inc., Prospectus Department, 640 Fifth Avenue, 4th Floor, New York, New York 10019 or by email at prospectus@ladenburg.com.
The private placement of the Series J Warrants and Series K Warrants are being made in a transaction not involving a public offering and the securities to be sold in the private placement have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state or other applicable jurisdiction’s securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state or other jurisdictions’ securities laws. Pursuant to the securities purchase agreement, the Company has agreed to file a registration statement with the SEC registering the resale of the ordinary shares underlying the Depositary Shares issuable upon the exercise of the Series J Warrants and Series K Warrants issued in the private placement.
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 offer, solicitation or sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. Any offering of the securities under the resale registration statement will only be made by means of a prospectus.
About the Cancer Prevention and Research Institute of Texas
CPRIT was created by the Texas Legislature and approved by a statewide vote in 2007 to lead the Lone Star State’s fight against cancer. In 2019, Texas voters again voted overwhelmingly to continue CPRIT with an additional
About Biodexa Pharmaceuticals PLC
Biodexa Pharmaceuticals PLC (listed on NASDAQ: BDRX) is a clinical stage biopharmaceutical company developing a pipeline of innovative products for the treatment of diseases with unmet medical needs. The Company’s lead development programs include eRapa, under development for Familial Adenomatous Polyposis and Non-Muscle Invasive Blader Cancer: tolimidone, under development as a for the treatment of type 1 diabetes; and MTX110, which is being studied in aggressive rare/orphan brain cancer indications.
eRapa is a proprietary oral tablet formulation of rapamycin, also known as sirolimus. Rapamycin is an mTOR (mammalian Target Of Rapamycin) inhibitor. mTOR has been shown to have a significant role in the signalling pathway that regulates cellular metabolism, growth and proliferation and is activated during tumorgenesis.
Tolimidone is an orally delivered, potent and selective inhibitor of Lyn kinase. Lyn is a member of the Src family of protein tyrosine kinases, which is mainly expressed in hematopoietic cells, in neural tissues, liver, and adipose tissue. Tolimidone demonstrates glycemic control via insulin sensitization in animal models of diabetes and has the potential to become a first in class blood glucose modulating agent.
MTX110 is a solubilised formulation of the histone deacetylase (HDAC) inhibitor, panobinostat. This proprietary formulation enables delivery of the product via convection-enhanced delivery (CED) at chemotherapeutic doses directly to the site of the tumor, by-passing the blood-brain barrier and potentially avoiding systemic toxicity.
Biodexa is supported by three proprietary drug delivery technologies focused on improving the bio-delivery and bio-distribution of medicines. Biodexa’s headquarters and R&D facility is in Cardiff, UK. For more information visit www.biodexapharma.com.
Forward-Looking Statements
Certain statements in this announcement may constitute “forward-looking statements” within the meaning of legislation in the United Kingdom and/or United States. Such statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are based on management’s belief or interpretation. All statements contained in this announcement that do not relate to matters of historical fact should be considered forward-looking statements including, but not limited to, the timing, size and expectation of the closing of the private placement, the satisfaction of customary closing conditions related to the private placement and the anticipated use of proceeds therefrom, and projected cash runway. In certain cases, forward-looking statements can be identified by the use of words such as “plans”, “expects” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved.” Forward-looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of the Company to control or predict, that may cause their actual results, performance or achievements to be materially different from those expressed or implied thereby, and are developed based on assumptions about such risks, uncertainties and other factors set out herein.
Reference should be made to those documents that Biodexa shall file from time to time or announcements that may be made by Biodexa in accordance with the rules and regulations promulgated by the SEC, which contain and identify other important factors that could cause actual results to differ materially from those contained in any projections or forward-looking statements. These forward-looking statements speak only as of the date of this announcement. All subsequent written and oral forward-looking statements by or concerning Biodexa are expressly qualified in their entirety by the cautionary statements above. Except as may be required under relevant laws in the United States, Biodexa does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future events or events otherwise arising.
For more information, please contact:
| Biodexa Pharmaceuticals PLC |
| Stephen Stamp, CEO, CFO Tel: +44 (0)29 20480 180 www.biodexapharma.com |
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