Catalyst Pharmaceuticals, Inc. Announces Closing of Public Offering
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Insights
The recent closure of Catalyst Pharmaceuticals' underwritten public offering represents a significant capital infusion for the company. The sale of 10 million shares at $15.00 each, resulting in net proceeds of approximately $140.1 million, is a substantial liquidity event. This capital raise is indicative of the company's proactive strategy in strengthening its balance sheet, which could enhance its ability to fund new product acquisitions and support general corporate functions.
Investors should note the confidence displayed by underwriters in granting a 30-day option for an additional 1.5 million shares, signaling a potential over-subscription scenario. The involvement of prominent financial institutions as bookrunners and co-lead managers could also be seen as a vote of confidence in Catalyst's prospects. However, it is crucial to monitor how the company allocates the raised funds, as effective deployment could lead to growth while misallocation might dilute shareholder value.
The use of an automatic shelf registration statement for this offering is a strategic move, allowing Catalyst Pharmaceuticals to act quickly in capitalizing on favorable market conditions. By filing with the SEC in advance, the company was able to expedite the offering process. The decision to allocate funds towards the acquisition of new product candidates could indicate a directional shift towards expanding their portfolio, which may impact their market position and competitive edge.
The pharmaceutical industry is characterized by high research and development costs and the ability to swiftly acquire promising product candidates can be a game-changer. Investors should watch for subsequent announcements regarding acquisitions, as these can significantly influence the company's growth trajectory and stock performance.
The biotech sector is highly dependent on continuous funding for research and development. Catalyst Pharmaceuticals' move to secure funding through a public offering is a common strategy within the industry to ensure sufficient capital for future investments. The earmarking of funds for potential acquisitions is particularly noteworthy as it underscores the company's growth-oriented strategy, which is aligned with industry norms where companies often seek to expand their product pipelines through strategic acquisitions.
Assessing the long-term implications, the successful acquisition and integration of new product candidates could lead to diversification of Catalyst's portfolio, potentially reducing risk and dependency on a limited number of products. However, the integration of new assets will require careful management to avoid potential pitfalls such as integration challenges and regulatory hurdles.
CORAL GABLES, Fla., Jan. 09, 2024 (GLOBE NEWSWIRE) -- Catalyst Pharmaceuticals, Inc. (“Catalyst” or the “Company”) (Nasdaq: CPRX) today reported that it has closed its underwritten public offering of shares of its common stock. The Company sold 10,000,000 shares of its common stock in the offering at a public offering price of
BofA Securities, Citigroup, Piper Sandler & Co., Cantor, and Truist Securities acted as bookrunners for the offering. H.C. Wainwright & Co. and Oppenheimer & Co. acted as co-lead managers for the offering.
The net proceeds from the sale of the shares, after underwriting discounts and estimated expenses, was approximately
The shares were offered pursuant to an automatic shelf registration statement (including a prospectus) on Form S-3 (File No. 333-274427), filed with the Securities and Exchange Commission (“SEC”) pursuant to the Securities Act of 1933, as amended, on September 8, 2023. The offering was made only by means of a prospectus and prospectus supplement that formed part of the registration statement. A final prospectus supplement and the accompanying prospectus relating to the offering was filed with the SEC and is available on the SEC's website at http://www.sec.gov. Copies of the final prospectus supplement and the accompanying prospectus relating to the offering may be obtained by contacting BofA Securities, Attention: Prospectus Department, NC1-022-02-25, 201 North Tryon Street, Charlotte, NC 28255-0001, or by email at dg.prospectus_requests@bofa.com; or Citigroup, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, by telephone at (800) 831-9146.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor will 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 registration or qualification under the securities laws of any such state or other jurisdiction.
About Catalyst Pharmaceuticals
With exceptional patient focus, Catalyst is committed to developing and commercializing innovative first-in-class medicines that address rare neurological and epileptic diseases. Catalyst's flagship U.S. commercial product is FIRDAPSE® (amifampridine) Tablets 10 mg, approved for the treatment of Lambert Eaton myasthenic syndrome ("LEMS") for adults and for children ages six to seventeen. In January 2023, Catalyst acquired the U.S. commercial rights to FYCOMPA® (perampanel) CIII, a prescription medicine approved in people with epilepsy aged four and older alone or with other medicines to treat partial-onset seizures with or without secondarily generalized seizures and with other medicines to treat primary generalized tonic-clonic seizures for people with epilepsy aged 12 and older. Further, Canada's national healthcare regulatory agency, Health Canada, has approved the use of FIRDAPSE for the treatment of adult patients in Canada with LEMS. Finally, on July 18, 2023, Catalyst acquired an exclusive license for North America for AGAMREE® (vamorolone) oral suspension 40 mg/mL, a novel corticosteroid treatment for Duchenne Muscular Dystrophy. AGAMREE previously received FDA Orphan Drug and Fast Track designations and was approved by the FDA for commercialization in the U.S. on October 26, 2023.
Forward-Looking Statements
This press release contains forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. These include statements regarding Catalyst’s expectations, beliefs, plans or objectives regarding the intended use of net proceeds therefrom. Forward-looking statements involve known and unknown risks and uncertainties, which may cause Catalyst's actual results in future periods to differ materially from forecasted results. A number of factors, including those factors described in Catalyst's Annual Report on Form 10-K for the fiscal year 2022 and its other filings with the U.S. Securities and Exchange Commission ("SEC"), could adversely affect Catalyst. Copies of Catalyst's filings with the SEC are available from the SEC, may be found on Catalyst's website, or may be obtained upon request from Catalyst. Catalyst does not undertake any obligation to update the information contained herein, which speaks only as of this date.
Source: Catalyst Pharmaceuticals, Inc.
FAQ
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