89bio, Inc. Announces Pricing of $250.0 Million Public Offering of Common Stock and Pre-Funded Warrants

Rhea-AI Summary

89bio (Nasdaq: ETNB) has announced the pricing of its upsized public offering, consisting of 21,671,428 shares of common stock at $8.75 per share and pre-funded warrants to purchase up to 6,900,000 shares at $8.749 per share. The warrants have an exercise price of $0.001 and are immediately exercisable.

The company expects to raise approximately $250.0 million in gross proceeds before deducting underwriting discounts and expenses. The underwriters have a 30-day option to purchase up to an additional 4,285,714 shares. The offering is expected to close around January 30, 2025.

Goldman Sachs & Co. , Leerink Partners, and BofA Securities are serving as lead book-running managers, with Cantor as book-running manager for the offering.

Positive

• Substantial capital raise of $250.0 million strengthening the company's financial position
• Immediate access to capital through pre-funded warrants with minimal exercise price ($0.001)
• Strong underwriter support from major financial institutions

Negative

• Significant dilution for existing shareholders due to large share issuance
• Additional potential dilution from underwriters' option to purchase extra shares
• Further dilution possible from pre-funded warrants exercise

Insights

Investment Banking Analyst

The $250 million public offering represents a significant capital raise for 89bio, structured through a combination of common shares and pre-funded warrants. The pricing at $8.75 per share reflects a minimal discount to recent trading levels, suggesting robust institutional demand. The use of pre-funded warrants ($8.749 with $0.001 exercise price) provides flexibility for investors facing ownership restrictions while ensuring immediate access to capital.

The offering's upsized nature and backing by premier underwriters (Goldman Sachs, Leerink, BofA) signals strong institutional confidence in 89bio's pipeline and strategy. The additional 30-day option for underwriters to purchase 4.29M shares could potentially increase proceeds by $37.5 million.

This financing substantially strengthens 89bio's balance sheet, providing runway for advancing their liver and cardiometabolic disease programs. While the issuance represents notable dilution of approximately 23% (excluding the overallotment option), the enhanced cash position should support key clinical milestones and potential commercialization efforts. The timing and size of this raise suggest management's strategic approach to capitalizing on market conditions while ensuring adequate funding for value-creating activities.

SAN FRANCISCO, Jan. 28, 2025 (GLOBE NEWSWIRE) -- 89bio, Inc. (“89bio”) (Nasdaq: ETNB), a clinical-stage biopharmaceutical company focused on the development and commercialization of innovative therapies for the treatment of liver and cardiometabolic diseases, today announced the pricing of its previously announced upsized underwritten public offering of 21,671,428 shares of its common stock at a public offering price per share of $8.75 and, in lieu of common stock to a certain investor, pre-funded warrants to purchase up to 6,900,000 shares of its common stock at a public offering price of $8.749. The pre-funded warrants have an exercise price of $0.001 per share and are exercisable immediately. In addition, 89bio has granted the underwriters of the offering an option for a period of 30 days to purchase up to an additional 4,285,714 shares of its common stock at the public offering price, less the underwriting discounts and commissions. The gross proceeds of the offering to 89bio, before deducting the underwriting discounts and commissions and other offering expenses payable by 89bio, are expected to be approximately $250.0 million. The offering is expected to close on or about January 30, 2025, subject to the satisfaction of customary closing conditions.

Goldman Sachs & Co. LLC, Leerink Partners and BofA Securities are acting as lead book-running managers and Cantor is acting as book-running manager for the offering.

An automatically effective shelf registration statement relating to these securities was filed with the Securities and Exchange Commission (“SEC”) on May 23, 2023. The offering of the securities is being made only by means of a prospectus, including a prospectus supplement, forming a part of an effective registration statement. A preliminary prospectus supplement and accompanying prospectus relating to the offering have been filed with the SEC and are available on the SEC’s website, located at www.sec.gov. Electronic copies of the final prospectus supplement and the accompanying prospectus related to the offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov and may also be obtained, when available, by contacting: Goldman Sachs & Co. LLC, Attention: Prospectus Department, 200 West Street, New York, New York 10282, by telephone at (866) 471-2526 or by email at prospectus-ny@ny.email.gs.com; Leerink Partners, Attention: Syndicate Department, 53 State Street, 40th Floor, Boston, MA 02109, by telephone at (800) 808-7525, ext. 6105, or by email at syndicate@leerink.com; BofA Securities, Attention: Prospectus Department, NC1-022-02-25, 201 North Tryon, Charlotte, NC 28255-0001, or by email at dg.prospectus_requests@bofa.com; or Cantor Fitzgerald & Co., Attention: Capital Markets, 110 East 59th Street, 6th Floor, New York, NY 10022, or by email at prospectus@cantor.com.

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

About 89bio

89bio is a clinical-stage biopharmaceutical company dedicated to the development of therapies for patients with liver and cardiometabolic diseases who lack optimal treatment options. The company is focused on advancing its lead candidate, pegozafermin, through Phase 3 clinical development for the treatment of metabolic dysfunction-associated steatohepatitis and severe hypertriglyceridemia. Pegozafermin is a specifically engineered fibroblast growth factor 21 analog with unique glycoPEGylated technology that optimizes biological activity through an extended half-life. The company is headquartered in San Francisco.

Forward-Looking Statements

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the federal securities laws, including, but not limited to, 89bio’s expectations regarding the progress of its clinical trials, the consummation of the offering and the satisfaction of customary closing conditions with respect to the offering. Words such as “may,” “might,” “will,” “objective,” “intend,” “should,” “could,” “can,” “would,” “expect,” “believe,” “design,” “estimate,” “predict,” “potential,” “anticipate,” “goal,” “opportunity,” “develop,” “plan” or the negative of these terms, and similar expressions, or statements regarding intent, belief, or current expectations, are forward looking statements. While 89bio believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to us on the date of this release. These forward-looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties (including, without limitation, those set forth in 89bio’s filings with the SEC), many of which are beyond 89bio’s control and subject to change. Actual results could be materially different. Risks and uncertainties include: changes as a result of market conditions or for other reasons; the risk that the offering will not be consummated; the impact of general economic, health, industrial or political conditions in the United States or internationally; and other risks and uncertainties identified in 89bio’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 and other subsequent disclosure documents filed with the SEC. 89bio claims the protection of the Safe Harbor contained in the Private Securities Litigation Reform Act of 1995 for forward-looking statements. 89bio expressly disclaims any obligation to update or alter any statements whether as a result of new information, future events or otherwise, except as required by law.

Investor Contact:
Annie Chang
89bio, Inc.
annie.chang@89bio.com

PJ Kelleher
LifeSci Advisors, LLC
+1 617-430-7579
pkelleher@lifesciadvisors.com

Media Contact:
Sheryl Seapy
Real Chemistry
sseapy@realchemistry.com

FAQ

How much money is 89bio (ETNB) raising in its January 2025 public offering?

89bio is raising approximately $250.0 million in gross proceeds through its public offering of common stock and pre-funded warrants.

What is the price per share for ETNB's January 2025 public offering?

The public offering price is $8.75 per share of common stock, and $8.749 for pre-funded warrants.

How many shares is ETNB offering in its January 2025 public offering?

89bio is offering 21,671,428 shares of common stock and pre-funded warrants to purchase up to 6,900,000 shares.

When will ETNB's January 2025 public offering close?

The offering is expected to close on or about January 30, 2025, subject to customary closing conditions.

What is the exercise price of ETNB's pre-funded warrants in the January 2025 offering?

The pre-funded warrants have an exercise price of $0.001 per share and are exercisable immediately.