CNS Pharmaceuticals Announces Pricing of $4.0 Million Public Offering

Rhea-AI Summary

CNS Pharmaceuticals, Inc. announced a public offering of 13,333,334 shares of common stock at a purchase price of $0.30 per share, along with the issuance of Series A and Series B Warrants to purchase up to the same number of shares. Healthcare-focused institutional investors and certain officers and directors of the Company are participating in the offering. The offering is expected to raise significant capital for the development of novel treatments for brain and central nervous system cancers.

Insights

Financial Analyst

The recent public offering by CNS Pharmaceuticals is a significant event that warrants a financial analysis. The offering involves the sale of over 13 million shares at a price of $0.30 each, which is a critical fundraising activity for the company. This influx of capital could be pivotal in supporting ongoing research and development, particularly in the high-stakes field of brain and central nervous system cancers. Investors and analysts should closely monitor the utilization of these funds, as efficient allocation towards promising treatments can enhance the company's valuation and future revenue streams.

Moreover, the issuance of Series A and Series B Warrants at an identical exercise price as the shares indicates a strategic move to potentially dilute the stock in the future but also provides an opportunity for investors to increase their stake in the company at a fixed price. The immediate exercisability of these warrants suggests that the company is confident in its short-term prospects and is willing to bet on its stock's performance. The differing expiration dates of the warrants introduce a layered approach to investment, with the longer-term Series A Warrants likely reflecting a more robust confidence in the company's long-term trajectory.

Market Research Analyst

From a market perspective, CNS Pharmaceuticals' public offering can be seen as an attempt to capitalize on the growing interest in innovative cancer treatments. The biopharmaceutical sector is highly competitive and CNS' focus on brain and central nervous system cancers places it in a niche market with substantial unmet medical needs. The pricing of the offering at $0.30 per share is indicative of the company's current market valuation and investor sentiment.

Investors should consider the impact of this offering on the company's market capitalization and how it compares with industry peers. The entry of healthcare-focused institutional investors and company insiders signals a vote of confidence in CNS' strategic direction. However, the potential increase in share count due to the exercise of warrants could lead to dilution of existing shares, which is a concern for current shareholders. It's important to assess how this offering aligns with industry fundraising norms and the implications for future stock performance.

Medical Research Analyst

As a Medical Research Analyst, it is pertinent to examine the implications of CNS Pharmaceuticals' funding on its research pipeline. The company's specialization in novel treatments for cancers of the brain and central nervous system is a challenging and expensive endeavor. The capital raised through this offering is likely earmarked for clinical trials and research development, which are crucial for gaining FDA approval and bringing new therapies to market.

Given the complexity and high failure rates in oncology drug development, the investment community should scrutinize the company's research pipeline, clinical trial progress and the scientific merit of its therapeutic candidates. The success of these candidates will not only determine the company's future but also contribute to the broader oncology field. The company's ability to meet its research milestones will be a significant driver of its stock performance and its potential to deliver on the promise of novel cancer treatments.

HOUSTON, TX / ACCESSWIRE / January 29, 2024 / CNS Pharmaceuticals, Inc. (NASDAQ:CNSP) ("CNS" or the "Company"), a biopharmaceutical company specializing in the development of novel treatments for primary and metastatic cancers in the brain and central nervous system, today announced the pricing of its "reasonable best efforts" public offering with participation from healthcare-focused institutional investors and certain officers and directors of the Company for the purchase and sale of 13,333,334 shares of common stock (or common stock equivalents in lieu thereof) at a purchase price of $0.30 per share. The Company further agreed to issue to the investors Series A Warrants to purchase up to 13,333,334 shares of common stock and Series B Warrants to purchase up to 13,333,334 shares of common stock. The Series A and Series B Warrants will have an exercise price of $0.30 per share, will be exercisable immediately following the date of issuance and will expire in five years and eighteen months, respectively.

The closing of the offering is expected to occur on or about February 1, 2024, subject to the satisfaction of customary closing conditions. The Company intends to use the net proceeds of this offering for the Company's CNS-201 trial, for other research and development and for working capital purposes.

A.G.P./Alliance Global Partners is acting as the lead placement agent and Maxim Group LLC is acting as the co-placement agent in connection with the offering.

The securities described above are being offered pursuant to a registration statement on Form S-1 (File No. 333-275973) previously filed with the Securities and Exchange Commission ("SEC") which became effective on January 29, 2024. The offering is being made only by means of a prospectus forming part of the effective registration statement. A preliminary prospectus relating to the offering has been filed with the SEC. An electronic copy of the final prospectus will be filed with the SEC and may be obtained, when available, on the SEC's website located at http://www.sec.gov and may also be obtained from A.G.P./Alliance Global Partners, 590 Madison Avenue, 28th Floor, New York, NY 10022, or by telephone at (212) 624-2060, or by email at prospectus@allianceg.com.

The Company has also agreed that certain existing warrants to purchase up to an aggregate of 3,756,000 shares at an exercise price of $1.28 per share and a termination date of October 16, 2028, will be amended, subject to shareholder approval, so that the amended warrants will have a reduced exercise price of $0.30 per share and a new termination date of February 1, 2029. If shareholder approval is not received, such existing warrants will have an exercise price equal to the Nasdaq minimum price on the six-month anniversary of the closing of this offering and a new termination date of February 1, 2029. The other terms of such warrants will remain unchanged.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, 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 CNS Pharmaceuticals, Inc.
CNS Pharmaceuticals a clinical-stage pharmaceutical company developing a pipeline of anti-cancer drug candidates for the treatment of primary and metastatic cancers of the brain and central nervous system. The Company's lead drug candidate, Berubicin, is a novel anthracycline and the first anthracycline to appear to cross the blood-brain barrier. Berubicin is currently in development for the treatment of a number of serious brain and CNS oncology indications including glioblastoma multiforme (GBM), an aggressive and incurable form of brain cancer.

For more information, please visit www.CNSPharma.com, and connect with the Company on Twitter, Facebook, and LinkedIn.

Forward-Looking Statements
Some of the statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties. Forward-looking statements include, without limitation, the satisfaction of the customary closing conditions related to the offering and the intended use of proceeds from the offering. These statements relate to future events, future expectations, plans and prospects. Although CNS believes the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward-looking statements. CNS has attempted to identify forward-looking statements by terminology including ''believes,'' ''estimates,'' ''anticipates,'' ''expects,'' ''plans,'' ''projects,'' ''intends,'' ''potential,'' ''may,'' ''could,'' ''might,'' ''will,'' ''should,'' ''approximately'' or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including market and other conditions and those discussed under the heading "Risk Factors" in the Company's Registration Statement on Form S-1, as amended, filed with the SEC and in its other public filings with the SEC. Any forward-looking statements contained in this press release speak only as of its date. CNS undertakes no obligation to update any forward-looking statements contained in this press release to reflect events or circumstances occurring after its date or to reflect the occurrence of unanticipated events, except as required by law.

CONTACTS:
Investor Relations Contact
JTC Team, LLC
Jenene Thomas
833-475-8247
CNSP@jtcir.com

SOURCE: CNS Pharmaceuticals, Inc.

View the original press release on accesswire.com

FAQ

What is the pricing of CNS Pharmaceuticals, Inc.'s public offering?

The pricing of the public offering is $0.30 per share for 13,333,334 shares of common stock.

Who is participating in CNS Pharmaceuticals, Inc.'s public offering?

Healthcare-focused institutional investors and certain officers and directors of the Company are participating in the public offering.

What are Series A and Series B Warrants issued by CNS Pharmaceuticals, Inc.?

Series A and Series B Warrants are issued to purchase up to 13,333,334 shares of common stock at an exercise price of $0.30 per share.

When is the closing of CNS Pharmaceuticals, Inc.'s public offering expected to occur?

The closing of the offering is expected to occur on or