Entera Bio Announces Closing of Private Placement - Extends Cash Runway into 2025
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Insights
Entera Bio Ltd.'s recent private placement of nearly 8 million units at $0.835 each has generated approximately $6.6 million in gross proceeds, which is a strategic move for bolstering the company's working capital and extending its operational horizon into 2025. This transaction is particularly significant for the company's financial stability and future growth prospects.
The inclusion of five-year warrants with an exercise price of $1.00, a 41% premium over the recent closing price, is an optimistic signal to the market regarding the company's valuation expectations. However, the reliance on warrant exercises for additional capital highlights the inherent uncertainty in future financing and dilution risk for current shareholders.
Investors should note the potential impact on share price due to the issuance of new shares and warrants. The dilutive effect might offset the benefits of increased capital in the short term, but if the company effectively utilizes the proceeds to accelerate growth, it could lead to long-term value creation.
The private placement was executed under an exemption from registration provided by the Securities Act of 1933, which indicates a faster and potentially less costly capital raise for Entera Bio Ltd. compared to a public offering. However, it also means that the securities are subject to resale restrictions and cannot be freely traded in the public market unless they are subsequently registered or qualify for an exemption.
This legal nuance is important for investors to understand, as it affects the liquidity of the newly issued securities. The company's strategic decision to opt for private placement over a public offering may reflect a balance between the need for capital and the desire to minimize regulatory overhead and market impact.
The biotech sector, where Entera Bio Ltd. operates, is capital-intensive and often characterized by long development cycles. Raising capital through private placements is common, as it enables companies to fund research and development activities without incurring the costs and scrutiny of public offerings.
The market will likely monitor how the proceeds are allocated towards advancing Entera's pipeline of orally delivered peptides and therapeutic proteins. Success in the development of these products could position Entera Bio Ltd. favorably in the competitive biotech landscape, while failure to progress could jeopardize investor confidence and the company's financial health.
JERUSALEM, Dec. 26, 2023 (GLOBE NEWSWIRE) -- Entera Bio Ltd. (NASDAQ: ENTX), (“Entera” or the “Company”) a leader in the development of orally delivered peptides and therapeutic proteins, announced that, on December 22, 2023, it closed a private placement with certain existing and new investors. The Company issued and sold 7,916,879 units at a price of
The five-year warrants to purchase one ordinary share at an exercise price of
The offer and sale of the foregoing securities were made in a private placement pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), and such securities have not been registered under the Securities Act or applicable state securities laws. The securities 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 applicable state securities laws. This press release shall not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of any such 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 Entera Bio
Entera is a clinical stage company focused on developing oral peptide or protein replacement therapies for significant unmet medical needs where an oral tablet form holds the potential to transform the standard of care. The Company leverages on a disruptive and proprietary technology platform and its pipeline includes five differentiated, first-in-class oral peptide programs, expected to enter into the clinic (Phase 1 to Phase 3) by 2025. The Company’s most advanced product candidate, EB613 (oral PTH (1-34), teriparatide), is being developed as the first oral, osteoanabolic (bone building) once-daily tablet treatment for post-menopausal women with low BMD and high-risk osteoporosis, with no prior fracture. A placebo controlled, dose ranging Phase 2 study of EB613 tablets (n= 161) met primary (PD/bone turnover biomarker) and secondary endpoints (BMD). Entera is preparing to initiate a Phase 3 registrational study for EB613. The EB612 program is being developed as the first oral PTH (1-34) tablet peptide replacement therapy for hypoparathyroidism. Entera is also developing the first oral oxyntomodulin, a dual targeted GLP1/glucagon peptide, in tablet form for the treatment of obesity; and first oral GLP-2 peptide tablet as an injection-free alternative for patients suffering from rare malabsorption conditions such as short bowel syndrome in collaboration with OPKO Health. For more information on Entera Bio, visit www.enterabio.com
Cautionary Statement Regarding Forward Looking Statements
Various statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements (other than statements of historical facts) in this press release regarding our prospects, plans, financial position, business strategy and expected financial and operational results may constitute forward-looking statements. Words such as, but not limited to, “anticipate,” “believe,” “can,” “could,” “expect,” “estimate,” “design,” “goal,” “intend,” “may,” “might,” “objective,” “plan,” “predict,” “project,” “target,” “likely,” “should,” “will,” and “would,” or the negative of these terms and similar expressions or words, identify forward-looking statements. Forward-looking statements are based upon current expectations that involve risks, changes in circumstances, assumptions and uncertainties. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will be achieved.
Important factors that could cause actual results to differ materially from those reflected in Entera’s forward-looking statements include, among others: changes in the interpretation of clinical data; results of our clinical trials; the FDA’s interpretation and review of our results from and analysis of our clinical trials; unexpected changes in our ongoing and planned preclinical development and clinical trials, the timing of and our ability to make regulatory filings and obtain and maintain regulatory approvals for our product candidates; the potential disruption and delay of manufacturing supply chains; loss of available workforce resources, either by Entera or its collaboration and laboratory partners; impacts to research and development or clinical activities that Entera may be contractually obligated to provide; overall regulatory timelines; the size and growth of the potential markets for our product candidates; the scope, progress and costs of developing Entera’s product candidates; Entera’s reliance on third parties to conduct its clinical trials; Entera’s expectations regarding licensing, business transactions and strategic collaborations; Entera’s operation as a development stage company with limited operating history; Entera’s ability to continue as a going concern absent access to sources of liquidity; Entera’s ability to obtain and maintain regulatory approval for any of its product candidates; Entera’s ability to comply with Nasdaq’s minimum listing standards and other matters related to compliance with the requirements of being a public company in the United States; Entera’s intellectual property position and its ability to protect its intellectual property; and other factors that are described in the “Cautionary Statements Regarding Forward-Looking Statements,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of Entera’s most recent Annual Report on Form 10-K filed with the SEC, as well as the company’s subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. There can be no assurance that the actual results or developments anticipated by Entera will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, Entera. Therefore, no assurance can be given that the outcomes stated or implied in such forward-looking statements and estimates will be achieved. Entera cautions investors not to rely on the forward-looking statements Entera makes in this press release. The information in this press release is provided only as of the date of this press release, and Entera undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.
FAQ
What did Entera Bio Ltd. (NASDAQ: ENTX) announce?
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What is the exercise price of the five-year warrants issued by Entera Bio Ltd.?
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