Biodexa Announces Pricing of $5.2 Million Underwritten Public Offering
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Insights
Biodexa Pharmaceuticals PLC's recent announcement of an underwritten public offering represents a strategic move to raise capital, presumably to fund its ongoing and future clinical programs. The structure of the offering, with both Class A and Class B Units including Depositary Shares and Series E and F Warrants, is designed to attract a range of investors, from those looking for immediate equity participation to those seeking a longer-term investment via warrants.
The offering price of $2.00 per Class A Unit and $1.9999 per Class B Unit suggests a discount to the current market price, which is a common strategy to incentivize participation. However, the impact of this offering on existing shareholders could be dilutive, particularly if a significant number of warrants are exercised. This dilution could potentially depress the stock price in the short term, as the market adjusts to the increased share count.
Investors will need to consider the potential for value creation versus dilution risk. The fact that the Pre-Funded Warrants do not expire adds a layer of complexity to the valuation of these instruments. Long-term, the success of this capital raise will largely depend on Biodexa's ability to advance its pipeline products and ultimately deliver on its promise of addressing unmet medical needs.
From an industry perspective, Biodexa Pharmaceuticals PLC's approach to funding is indicative of the capital-intensive nature of the biopharmaceutical sector. The offering's structure, with a mix of Depositary Shares and Warrants, is tailored to provide the company with immediate capital while offering investors potential for future equity at a fixed exercise price.
It is essential to analyze the competitive landscape and the therapeutic areas Biodexa targets. If the company's pipeline has a strong differentiation and addresses high-value markets, the long-term prospects could be favorable. However, the biopharmaceutical market is highly competitive and the success rates of clinical trials are inherently uncertain.
The absence of variable pricing or anti-dilution features in the warrants suggests confidence in the stability of the company's share price, which could be seen as a positive signal to the market. Nonetheless, the true value of this offering will be realized only if the company can successfully progress its clinical trials and bring products to market.
From a legal standpoint, the structure of the underwritten public offering by Biodexa Pharmaceuticals PLC appears to comply with regulatory standards for such transactions. The immediate separability of the securities comprising the Units is a notable feature, as it provides flexibility for investors to trade these components independently.
Investors should be aware of the legal implications of the Series E and F Warrants' terms. The fixed exercise price of $2.20 for both types of warrants and the differing expiration dates provide a clear legal framework for investors to make informed decisions. However, investors should also consider the potential legal rights or restrictions associated with the Pre-Funded Warrants, given their indefinite exercise period.
The transparency of the offering terms, including the lack of price-based anti-dilution features, aligns with regulatory expectations for fairness and clarity in securities offerings. Investors should, however, conduct due diligence on the offering documents to understand fully the terms and conditions associated with the securities being offered.
Biodexa Pharmaceuticals PLC
(“Biodexa” or the “Company”)
CARDIFF, United Kingdom, Dec. 19, 2023 (GLOBE NEWSWIRE) -- Biodexa Pharmaceuticals PLC, (Nasdaq: BDRX), a clinical stage biopharmaceutical company developing a pipeline of innovative products for the treatment of diseases with unmet medical needs, today announced the pricing of an underwritten public offering of units.
Ladenburg Thalmann & Co. Inc. is acting as sole book-running manager in connection with the offering.
The underwritten public offering is comprised of (a) 697,614 Class A Units (the “Class A Units”), with each Class A Unit consisting of (i) one Depositary Share (representing 400 of the Company’s ordinary shares, nominal value
Each Pre-Funded Warrant has an exercise price per share equal to
The securities comprising the Units are immediately separable and will be issued separately. The closing of the offering is expected to take place on or about December 21, 2023, subject to the satisfaction or waiver of customary closing conditions.
A total of 697,614 Depositary Shares, Pre-Funded Warrants to purchase up to 1,911,176 Depositary Shares, and Warrants to purchase up to 5,217,580 Depositary Shares will be issued in the underwritten public offering. In addition, the Company has granted the underwriters a 45-day option to purchase up to an additional 391,273 Depositary Shares, Series E Warrants to purchase an additional 391,273 Depositary Shares and/or Series F Warrants to purchase an additional 391,273 Depositary Shares, to cover over-allotments, if any, at the public offering price per Depositary Shares and per Warrant, less the underwriting discounts and commissions.
The securities issued as part of the underwritten public offering were offered pursuant to a registration statement on Form F-1, as amended (File No. 333-274895), which was declared effective by the United States Securities and Exchange Commission (“SEC”) on December 18, 2023.
This press release does not constitute an offer to sell or the solicitation of an offer to buy, nor will there be any sales of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. The underwritten public offering is being made solely by means of a prospectus. A final prospectus relating to this offering will be filed by Biodexa with the SEC. When available, copies of the final prospectus can be obtained at the SEC’s website at www.sec.gov or from Ladenburg Thalmann & Co. Inc., Prospectus Department, 640 Fifth Avenue, 4th Floor, New York, New York 10019 or by email at prospectus@ladenburg.com.
About Biodexa Pharmaceuticals PLC
Biodexa Pharmaceuticals PLC (listed on NASDAQ: BDRX) is a clinical stage biopharmaceutical company developing a pipeline of products aimed at primary and metastatic cancers of the brain. The Company’s lead candidate, MTX110, is being studied in aggressive rare/orphan brain cancer indications including recurrent glioblastoma and diffuse midline glioma.
MTX110 is a liquid formulation of the histone deacetylase (HDAC) inhibitor, panobinostat. This proprietary formulation enables delivery of the product via convection-enhanced delivery (CED) at potentially therapeutic doses directly to the site of the tumour, by-passing the blood-brain barrier and 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.
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. 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.” Examples of forward-looking statements include, among others, statements we make regarding the closing of the offering of securities. 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 |
| Edison Group (US Investor Relations) |
| Alyssa Factor |
| Tel: +1 (860) 573 9637 |
| Email: afactor@edisongroup.com |
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