Evaxion announces closing of $10.8 million public offering

Rhea-AI Summary

Evaxion Biotech (NASDAQ: EVAX) has announced the closing of a $10.8 million public offering, consisting of 3,997,361 American Depositary Shares (ADSs) and warrants to purchase up to 50% of the ADSs at $2.71 per ADS. Each ADS represents fifty ordinary shares, and the warrants are exercisable immediately with a five-year expiration.

Notable participants in this offering include MSD Global Health Innovation Fund, a corporate venture capital arm of Merck & Co., who became a shareholder in December 2023, along with healthcare-focused investment funds and participation from Evaxion's Board and Management. Lake Street Capital Markets and Jones served as exclusive placement agents.

The company plans to use the net proceeds to advance its preclinical and clinical pipeline, and for continuing operating expenses and working capital.

Positive

• Secured $10.8 million in gross proceeds through public offering
• Strategic investment from MSD Global Health Innovation Fund (Merck's venture arm)
• Internal confidence demonstrated through Board and Management participation
• Five-year warrant terms provide potential for additional future capital

Negative

• Potential dilution for existing shareholders through ADS offering
• Additional dilution possible if warrants are exercised

Insights

Financial Analyst

The successful closing of Evaxion's $10.8M public offering marks a significant capital injection that strengthens the company's financial position. Several aspects of this deal warrant attention:

Strategic Investor Participation: The follow-on investment by MSD Global Health Innovation Fund, Merck's venture arm, following their December 2023 entry, represents a strong vote of confidence. This continued engagement suggests potential strategic value beyond mere financial investment, possibly indicating future collaboration opportunities.

Offering Structure: The deal's architecture is noteworthy:

• ADSs priced at $2.71 with 50% warrant coverage
• Five-year warrants with immediate exercise rights at $2.71
• Board and management participation demonstrating internal confidence

Financial Impact: The offering provides an estimated 12-15 months of additional runway, based on typical biotech burn rates. The warrant component could potentially bring in additional $5.4M if fully exercised, though this would cause further dilution.

Market Context: This raise comes during a challenging period for biotech funding, making the successful close and institutional participation particularly meaningful. The pricing and structure align with current market conditions for clinical-stage biotech companies.

Biotech Research Analyst

This capital raise strategically positions Evaxion to advance its differentiated AI-Immunology™ platform, with several key implications for its development programs:

Pipeline Impact: The $10.8M funding enables:

• Advancement of preclinical candidates through critical development milestones
• Support for ongoing clinical trials and data readouts
• Further optimization of the AI-powered vaccine discovery platform

Technology Validation: Merck's continued investment, through its venture arm, provides significant validation of Evaxion's AI-driven approach to vaccine development. This backing from a major pharmaceutical player suggests potential commercial viability of the platform technology.

Competitive Positioning: The intersection of AI and immunology represents a rapidly evolving frontier in biotech. This funding strengthens Evaxion's position in this competitive landscape, particularly in the AI-driven drug discovery space where capital requirements are substantial.

COPENHAGEN, Denmark, January 31, 2025 - Evaxion Biotech A/S (NASDAQ: EVAX) (“Evaxion”), a clinical-stage TechBio company specializing in developing AI-Immunology™ powered vaccines, today announced the closing of a public offering of an aggregate of 3,997,361 of its American Depositary Shares (“ADSs”) and warrants to purchase up to 50% of the ADSs offered at a combined public offering price of $2.71 per ADS with one accompanying warrant for each two ADSs.

MSD Global Health Innovation Fund, a corporate venture capital arm of Merck & Co., Inc., Rahway, NJ, USA, who became an Evaxion shareholder in December 2023, participated in this offering along with healthcare-focused investment funds. There was also participation from Evaxion’s Board of Directors and Management.

The warrants have an exercise price of $2.71 per ADS, are exercisable immediately upon issuance and will expire five years following the date of issuance. Each ADS represents fifty ordinary shares of the company.

Lake Street Capital Markets and Jones acted as the exclusive placement agents for the offering. The gross proceeds to the company from the offering were $10.8 million, before deducting the placement agent’s fees and other offering expenses payable by the company. The company intends to use the net proceeds of this offering to advance the company’s preclinical and clinical pipeline, and for continuing operating expenses and working capital.

The securities described above were offered pursuant to a registration statement on Form F-1, as amended (File No. 333-283304), which was declared effective by the Securities and Exchange Commission (“SEC”) on January 29, 2025. The offering was made only by means of a prospectus forming a part of the effective registration statement relating to the offering.

A final prospectus relating to the offering has been filed with the SEC. Electronic copies of the final prospectus may be obtained on the SEC’s website located at http://www.sec.gov and may also be obtained by contacting Lake Street Capital Markets at Attn: Syndicate Department, 920 Second Avenue South, Suite 700, Minneapolis, MN 55402, by calling (612) 326-1305, or by emailing syndicate@lakestreetcm.com or JonesTrading Institutional Services LLC (“Jones”) at Attn: Equity Capital Markets, 325 Hudson Street, 6^th Floor, New York, NY 10013, by emailing ecm@jonestrading.com.

This press release shall not constitute an offer to sell or a 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.

Contact information 
Evaxion Biotech A/S
Mads Kronborg
Vice President, Investor Relations & Communication
+45 53 54 82 96
mak@evaxion.ai

About EVAXION
Evaxion Biotech A/S is a pioneering TechBio company based upon its AI platform, AI-Immunology™. Evaxion’s proprietary and scalable AI prediction models harness the power of artificial intelligence to decode the human immune system and develop novel immunotherapies for cancer, bacterial diseases, and viral infections. Based upon AI-Immunology™, Evaxion has developed a clinical-stage oncology pipeline of novel personalized vaccines and a preclinical infectious disease pipeline in bacterial and viral diseases with high unmet medical needs. Evaxion is committed to transforming patients’ lives by providing innovative and targeted treatment options.

Forward-looking statement 
This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “target,” “believe,” “expect,” “hope,” “aim,” “intend,” “may,” “might,” “anticipate,” “contemplate,” “continue,” “estimate,” “plan,” “potential,” “predict,” “project,” “will,” “can have,” “likely,” “should,” “would,” “could,” and other words and terms of similar meaning identify forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various factors, including, but not limited to, risks related to: our financial condition and need for additional capital; our development work; cost and success of our product development activities and preclinical and clinical trials; commercializing any approved pharmaceutical product developed using our AI platform technology, including the rate and degree of market acceptance of our product candidates; our dependence on third parties including for conduct of clinical testing and product manufacture; our inability to enter into partnerships; government regulation; protection of our intellectual property rights; employee matters and managing growth; our ADSs and ordinary shares, the impact of international economic, political, legal, compliance, social and business factors, including inflation, and the effects on our business from other significant geopolitical and macro-economic events; and other uncertainties affecting our business operations and financial condition. For a further discussion of these risks, please refer to the risk factors included in our most recent Annual Report on Form 20-F and other filings with the U.S. Securities and Exchange Commission (SEC), which are available at www.sec.gov. We do not assume any obligation to update any forward-looking statements except as required by law. 

FAQ

How much did Evaxion Biotech (EVAX) raise in their January 2025 public offering?

Evaxion Biotech raised $10.8 million in gross proceeds through their January 2025 public offering.

What is the structure of EVAX's January 2025 public offering?

The offering consists of 3,997,361 ADSs and warrants to purchase up to 50% of the ADSs at $2.71 per ADS, with each ADS representing fifty ordinary shares.

What are the terms of the warrants in EVAX's 2025 offering?

The warrants have an exercise price of $2.71 per ADS, are immediately exercisable upon issuance, and will expire five years after issuance.

How will EVAX use the proceeds from the January 2025 offering?

Evaxion plans to use the net proceeds to advance their preclinical and clinical pipeline, and for continuing operating expenses and working capital.

Who were the major investors in EVAX's January 2025 public offering?

Major investors included MSD Global Health Innovation Fund (Merck's venture arm), healthcare-focused investment funds, and members of Evaxion's Board of Directors and Management.