Bio-Path Holdings Announces $4.0 Million Private Placement Priced At-the-Market Under Nasdaq Rules

Rhea-AI Summary

Bio-Path Holdings (NASDAQ:BPTH) announced a private placement of $4.0 million, involving the sale of 1,809,955 shares of common stock and accompanying warrants priced at $2.21 per share. The series A warrants and series B warrants will be exercisable at $2.00 per share, with expiration periods of five years and 24 months, respectively. The closing is expected on June 5, 2024, pending customary conditions. H.C. Wainwright & Co. is the exclusive placement agent. The company plans to use the net proceeds for working capital and general corporate purposes. The securities are offered under Section 4(a)(2) and/or Regulation D and are not registered under the Securities Act.

Positive

• Gross proceeds expected to be approximately $4.0 million.
• Series A warrants have a five-year expiry, providing long-term exercise opportunities.
• Series B warrants have a 24-month expiry, offering short-term exercise opportunities.
• H.C. Wainwright & Co. acting as the exclusive placement agent may increase investor confidence.

Negative

• Shares and warrants are sold in a private placement, which may limit liquidity.
• Warrants exercise price of $2.00 could lead to potential dilution for existing shareholders.
• The securities are not registered under the Securities Act, restricting resale opportunities.
• Funds raised are expected to be used for working capital and general corporate purposes, which may not immediately drive growth.

Insights

Financial Analyst

Bio-Path Holdings' announcement of a $4.0 million private placement represents an important financial maneuver designed to bolster its working capital and support general corporate purposes. This move is significant given the company's continued focus on developing targeted nucleic acid cancer drugs using its proprietary DNAbilize® technology. By offering shares of common stock along with accompanying series A and B warrants, Bio-Path is leveraging the flexibility and potential future capital inflow provided by the exercisable warrants. The series A warrants, valid for five years and series B warrants, valid for twenty-four months, offer investors a chance to buy additional shares at a set price, providing a potential upside if the stock performs well. However, it's worth noting that the use of a private placement, as opposed to a public offering, may limit the immediate liquidity and visibility of the stock sale, potentially appealing more to institutional investors rather than retail investors.

Short-term implications: In the near term, the infusion of $4.0 million will help stabilize Bio-Path's financial footing, allowing it to continue its research and development activities without immediate financial strain. The announcement might cause a temporary increase in stock volatility as investors react to the dilution of shares and the potential benefits of the capital raise.

Long-term implications: From a long-term perspective, the success of this capital raise will heavily depend on Bio-Path's ability to use the funds effectively to advance its pipeline. The eventual exercise of the warrants could provide additional capital, contingent on the company's ability to deliver positive clinical trial results and regulatory milestones. Investors should closely monitor how the raised funds are allocated and the progress of Bio-Path's clinical programs.

Critical considerations: Potential investors should be aware of the common risks associated with biotechnology companies, including the uncertainty of clinical trial outcomes and regulatory approvals. The decision to invest should also consider the company's historical financial performance and its strategic plans moving forward.

Biotechnology Research Analyst

Bio-Path Holdings is strategically leveraging its proprietary DNAbilize® liposomal delivery and antisense technology to develop a portfolio of targeted nucleic acid cancer drugs. The recent private placement will provide much-needed capital to advance this innovative technology. The DNAbilize® platform offers a promising approach to cancer treatment by delivering antisense oligonucleotides directly to cancer cells, potentially overcoming limitations of traditional therapies.

Key insights: The funds raised will likely be used to support ongoing and future clinical trials, which are critical for demonstrating the efficacy and safety of their drug candidates. This funding can help expedite research timelines, potentially leading to faster clinical development and regulatory submissions. Investors should watch for upcoming clinical data releases, as positive results can significantly enhance the company's valuation and market perception.

Context within the industry: The biotechnology sector is highly competitive, with numerous companies developing novel cancer therapies. Bio-Path’s ability to differentiate its technology and achieve clinical milestones will be pivotal for its long-term success. The company's strategy to secure funding through private placements is a common practice in the biotech industry, allowing them to maintain control while raising necessary capital.

Conclusion: While the private placement improves Bio-Path’s immediate financial position, the ultimate success hinges on advancing their clinical programs and achieving tangible milestones. The technology holds potential, but the inherent risks of drug development remain.

HOUSTON, June 04, 2024 (GLOBE NEWSWIRE) -- Bio-Path Holdings, Inc. (NASDAQ:BPTH) (“Bio-Path” or the “Company”), a biotechnology company leveraging its proprietary DNAbilize® liposomal delivery and antisense technology to develop a portfolio of targeted nucleic acid cancer drugs, today announced that it has entered into a definitive agreement for the issuance and sale of an aggregate of 1,809,955 shares of its common stock (or common stock equivalents in lieu thereof), series A warrants to purchase up to 1,809,955 shares of common stock and short-term series B warrants to purchase up to 1,809,955 shares of common stock at a purchase price of $2.21 per share of common stock (or per common stock equivalent in lieu thereof) and accompanying warrants in a private placement priced at-the-market under Nasdaq rules. The series A warrants and short-term series B warrants will have an exercise price of $2.00 per share and will be exercisable immediately upon issuance. The series A warrants will expire five years from the date of issuance and the short-term series B warrants will expire twenty-four months from the date of issuance. The closing of the offering is expected to occur on or about June 5, 2024, subject to the satisfaction of customary closing conditions.

H.C. Wainwright & Co. is acting as the exclusive placement agent for the offering.

The gross proceeds to the Company from the offering are expected to be approximately $4.0 million, before deducting the placement agent’s fees and other offering expenses payable by the Company, and excluding the proceeds, if any, from the exercise of the warrants. The Company currently intends to use the net proceeds from the offering for working capital and general corporate purposes.

The securities described above are being offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and/or Regulation D promulgated thereunder and, along with the shares of common stock underlying the warrants, have not been registered under the Securities Act, or applicable state securities laws. Accordingly, the securities described above, including the shares of common stock underlying the warrants, may not be offered or sold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act and such applicable state securities laws. Pursuant to a registration rights agreement, the Company has agreed to file a resale registration statement covering the securities described above.

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

About Bio-Path Holdings, Inc.

Bio-Path is a biotechnology company developing DNAbilize®, a novel technology that has yielded a pipeline of RNAi nanoparticle drugs that can be administered with a simple intravenous transfusion. Bio-Path’s lead product candidate, prexigebersen (BP1001, targeting the Grb2 protein), is in a Phase 2 study for blood cancers, and BP1001-A, a drug product modification of prexigebersen, is in a Phase 1/1b study for solid tumors. The Company’s second product, BP1002, which targets the Bcl-2 protein, is being evaluated for the treatment of blood cancers and solid tumors, including lymphoma and acute myeloid leukemia. In addition, an IND application is expected to be filed for BP1003, a novel liposome-incorporated STAT3 antisense oligodeoxynucleotide developed by Bio-Path as a specific inhibitor of STAT3.

For more information, please visit the Company's website at www.biopathholdings.com.

Forward-Looking Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the federal securities laws, including statements related to the completion of the offering, the satisfaction of customary closing conditions related to the offering and the intended use of proceeds therefrom. These statements are based on management's current expectations and accordingly are subject to uncertainty and changes in circumstances. Any express or implied statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Any statements that are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties, including market and other conditions, Bio-Path’s ability to regain and maintain compliance with Nasdaq’s continued listing requirements, Bio-Path’s ability to raise needed additional capital on a timely basis in order for it to continue its operations, have success in the clinical development of its technologies, the timing of enrollment and release of data in such clinical studies, the accuracy of such data, limited patient populations of early stage clinical studies and the possibility that results from later stage clinical trials with much larger patient populations may not be consistent with earlier stage clinical trials, the maintenance of intellectual property rights, that patents relating to existing or future patent applications will be issued or that any issued patents will provide meaningful protection of our drug candidates, the impact, risks and uncertainties related to global pandemics, including the COVID-19 pandemic, and actions taken by governmental authorities or others in connection therewith, and such other risks which are identified in Bio-Path's most recent Annual Report on Form 10-K, in any subsequent quarterly reports on Form 10-Q and in other reports that Bio-Path files with the Securities and Exchange Commission from time to time. These documents are available on request from Bio-Path or at www.sec.gov. Bio-Path disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information:

Investors

Will O’Connor
Stern Investor Relations, Inc.
212-362-1200
will@sternir.com

Doug Morris
Investor Relations
Bio-Path Holdings, Inc.
832-742-1369

FAQ

What is the value of the private placement announced by Bio-Path Holdings?

The private placement is valued at approximately $4.0 million.

When is the closing date for Bio-Path Holdings' private placement?

The closing is expected to occur on or about June 5, 2024, subject to customary conditions.

What is the purchase price per share in Bio-Path Holdings' private placement?

The purchase price is $2.21 per share of common stock.

What are the exercise prices and expiration periods for the warrants in Bio-Path Holdings' private placement?

The series A and series B warrants have an exercise price of $2.00 per share. Series A warrants expire in five years, while series B warrants expire in 24 months.

How does Bio-Path Holdings intend to use the proceeds from the private placement?

The company plans to use the net proceeds for working capital and general corporate purposes.