BioXcel Therapeutics Announces Pricing of $7.0 Million Public Offering

Rhea-AI Summary

BioXcel Therapeutics (BTAI) has announced the pricing of a $7.0 million public offering, consisting of 5,600,000 shares of common stock and warrants to purchase up to 5,600,000 additional shares, along with pre-funded warrants for up to 9,000,000 shares and accompanying warrants. The combined offering price is set at $0.48 per share and accompanying warrant. The accompanying warrants will be exercisable immediately upon issuance, expire after five years, and have an exercise price of $0.48 per share. Canaccord Genuity is serving as the sole book-running manager, with the offering expected to close around November 25, 2024.

Positive

• Secured $7.0 million in gross proceeds through public offering
• Warrants provide potential for additional future capital

Negative

• Significant shareholder dilution through issuance of new shares and warrants
• Low offering price of $0.48 per share indicates weak market position
• Additional dilution possible if warrants are exercised

Insights

Financial Analyst

This $7.0 million public offering at $0.48 per share represents a significant dilution for existing shareholders, given the company's micro-cap status with a market cap of only $24.4 million. The offering structure, combining common stock with warrants and pre-funded warrants, suggests urgent capital needs. The extremely low pricing and the inclusion of warrants indicate challenging market conditions for BTAI. The warrant exercise price at $0.48 matches the offering price, providing no premium and potentially creating additional future dilution of up to 14.6 million shares if all warrants are exercised. This financing, while providing needed capital, comes at a high cost to shareholders and reflects significant financial stress.

NEW HAVEN, Conn., Nov. 22, 2024 (GLOBE NEWSWIRE) -- BioXcel Therapeutics, Inc. (the “Company”) (Nasdaq: BTAI), a biopharmaceutical company utilizing artificial intelligence approaches to develop transformative medicines in neuroscience and immuno-oncology, today announced the pricing of an underwritten public offering of 5,600,000 shares of its common stock, par value $0.001 per share (“Common Stock”), and accompanying warrants to purchase up to 5,600,000 shares of Common Stock, and, in lieu thereof to certain investors that so choose, pre-funded warrants to purchase up to 9,000,000 shares of Common Stock and accompanying warrants to purchase up to 9,000,000 shares of Common Stock, at a combined public offering price of $0.48 per share and accompanying warrant (or $0.479 per share underlying each pre-funded warrant and accompanying warrant, which equals the public offering price per share of Common Stock and accompanying warrant less the $0.001 exercise price per share of the pre-funded warrants). Gross proceeds to the Company from the offering are expected to be approximately $7.0 million, before deducting underwriting discounts and commissions and offering expenses, and excluding the exercise of any of the warrants.

Each of the warrants in the offering will be subject to customary beneficial ownership limitations on exercisability, will be exercisable at any time after the date of issuance of such warrant and, in the case of the accompanying warrants, will expire on the fifth anniversary of the date of issuance. Each of the accompanying warrants will have an exercise price of $0.48 per underlying share of Common Stock.

Canaccord Genuity is acting as sole book-running manager for the public offering. The offering is expected to close on or about November 25, 2024, subject to customary closing conditions.

The securities are being offered by the Company pursuant to a shelf registration statement on Form S-3 that was previously filed with the Securities and Exchange Commission (the “SEC”) on November 2, 2023 and which became effective on November 13, 2023. This offering is being made only by means of a written prospectus and prospectus supplement that form a part of the registration statement. A preliminary prospectus supplement relating to and describing the terms of the offering was filed with the SEC and is available on the SEC’s website at www.sec.gov. The final terms of the offering will be disclosed in a final prospectus supplement to be filed with the SEC. When available, copies of the prospectus supplement and the accompanying prospectus relating to the offering may also be obtained by contacting: Canaccord Genuity LLC, One Post Office Square, Suite 3000, Boston, MA 02109, Attn: Syndicate Department, by email at prospectus@cgf.com.

This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities, nor shall there be any sale of the 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 such jurisdiction.

Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this press release other than statements of historical fact should be considered forward-looking statements, including, without limitation, those regarding the completion of the offering and the expected gross proceeds therefrom, as well as the risks and uncertainties in the Company’s business, including those risks discussed in the “Risk Factors” section in the preliminary prospectus supplement relating to the offering. When used herein, words including “anticipate,” “believe,” “can,” “continue,” “could,” “designed,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, though not all forward-looking statements use these words or expressions. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking. All forward-looking statements are based upon the Company’s current expectations and various assumptions. The Company believes there is a reasonable basis for its expectations and beliefs, but they are inherently uncertain. The Company may not realize its expectations, and its beliefs may not prove correct. Actual results could differ materially from those described or implied by such forward-looking statements as a result of various important factors, including, without limitation, the important factors discussed under the caption “Risk Factors” in its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2024, as such factors may be updated from time to time in its other filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While the Company may elect to update such forward-looking statements at some point in the future, except as required by law, it disclaims any obligation to do so, even if subsequent events cause our views to change. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.

Contact Information

Corporate/Investors

BioXcel Therapeutics
Erik Kopp
1.203.494.7062
ekopp@bioxceltherapeutics.com

Media

Russo Partners
David Schull
1.858.717.2310
David.Schull@russopartnersllc.com

Copyright © 2024, BioXcel Therapeutics, Inc. All rights reserved.

FAQ

What is the size and price of BioXcel Therapeutics (BTAI) November 2024 public offering?

BioXcel Therapeutics' public offering is priced at $7.0 million, with shares and warrants priced at $0.48 per combined unit.

How many shares and warrants are included in BTAI's November 2024 offering?

The offering includes 5,600,000 common shares with accompanying warrants, plus pre-funded warrants to purchase up to 9,000,000 shares with accompanying warrants.

When will BTAI's November 2024 public offering close?

The offering is expected to close on or about November 25, 2024, subject to customary closing conditions.

What is the exercise price and duration of BTAI's warrants in the November 2024 offering?

The accompanying warrants have an exercise price of $0.48 per share and will expire on the fifth anniversary of their issuance date.