Krystal Biotech Announces Pricing of Upsized $125 Million Public Offering of Common Stock

Rhea-AI Summary

Krystal Biotech (NASDAQ: KRYS) announced a public offering of 1,923,077 shares at $65.00 per share, aiming to raise approximately $125 million. Underwriters have a 30-day option for an additional 288,461 shares. The funds will support pivotal trials for B-VEC, advance clinical development of KB105 and KB104, and bolster the respiratory pipeline. The offering is set to close around February 5, 2021, following customary conditions. Goldman Sachs, Cowen, and Evercore act as joint book-running managers.

Positive

• Plans to raise approximately $125 million to fund key clinical trials and pipeline advancements.
• Intended use of proceeds includes pivotal trial completion for B-VEC and advancing multiple gene therapies.

Negative

• Potential dilution of shares due to the public offering.
• Market conditions may affect the timing or completion of the offering.

PITTSBURGH, Feb. 02, 2021 (GLOBE NEWSWIRE) -- Krystal Biotech Inc. (NASDAQ: KRYS) (the “Company), the leader in redosable gene therapies for rare diseases, today announced that it has priced the previously announced underwritten public offering of 1,923,077 shares of its common stock, at a public offering price of $65.00 per share. The Company granted the underwriters a 30-day option to purchase up to an additional 288,461 shares of its common stock. The gross proceeds to the Company from this offering are expected to be approximately $125 million, before deducting the underwriting discounts and commissions and other estimated offering expenses payable by the Company. The offering is expected to close on or about February 5, 2021, subject to satisfaction of customary closing conditions.

Goldman Sachs & Co. LLC, Cowen, and Evercore ISI are acting as joint book-running managers for the offering. H.C. Wainwright & Co. is acting as lead manager for the offering and Ladenburg Thalmann & Co. Inc. and SMBC Nikko are acting as co-managers for the offering.

The Company currently intends to use the net proceeds from this offering together with its existing cash, cash equivalents and short-term investments: (i) to complete the ongoing pivotal trial of B-VEC for DEB and prepare for potential commercialization; (ii) to advance the clinical development of KB105 in TGM1-deficient icthyosis and preclinical development of KB104 for Netherton syndrome; (iii) to advance development of KB407 for cystic fibrosis; (iv) to accelerate the Company’s emerging respiratory pipeline; (v) to complete development of a good manufacturing practices certified manufacturing facility for scale-up production of the Company’s pipeline compounds and commencement of operations of that facility; and (vi) the balance for working capital and general corporate purposes, including research and development expenses and capital expenditures.

The offering is being made pursuant to a “shelf” registration statement on Form S-3 (File No. 333-237983) that became effective upon filing with the Securities and Exchange Commission (“SEC”) on May 4, 2020. A preliminary prospectus supplement relating to and describing the terms of the offering was filed with the SEC and is available on the SEC’s website at http://www.sec.gov. A final prospectus supplement and the accompanying base prospectus relating to the offering and the shares of common stock being offered will be filed with the SEC. Copies of the registration statement, the final prospectus supplement and the accompanying base prospectus may be obtained on the SEC’s website at http://www.sec.gov or, when available, by contacting: Goldman Sachs & Co. LLC, at Prospectus Department, 200 West Street, New York, New York 10282, by telephone at 866-471-2526, by facsimile at 212-902-9316 or by e-mail at prospectusgroup-ny@ny.emails.gs.com, or Cowen and Company, LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, Attn: Prospectus Department, by telephone at (833) 297-2926, or by email at PostSaleManualRequests@broadridge.com, or Evercore Group L.L.C., Attention: Equity Capital Markets, 55 East 52nd Street, 35th Floor, New York, New York 10055, telephone: 888-474-0200, email: ecm.prospectus@evercore.com.

This announcement is for informational purposes only and is not an offer to sell or the solicitation of an offer to buy any securities of the Company, which is made only by means of a prospectus supplement and related base prospectus, nor will there be any sale of these securities in any state 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 Krystal Biotech
Krystal Biotech, Inc. (NASDAQ:KRYS) is a pivotal-stage gene therapy company leveraging its novel, redosable gene therapy platform and in-house manufacturing capabilities to develop therapies to treat serious rare diseases.

Forward-Looking Statements
This press release contains forward-looking statements and information, including with respect to the offering and the intended use of the proceeds of the offering. The use of words such as “may,” “might,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “project,” “intend,” “future,” “potential,” or “continue,” and other similar expressions, are intended to identify forward-looking statements. Although the Company’ s management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of the Company, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include, among others: the Company’ s ability to satisfy the closing conditions of the offering, the timing or occurrence of the closing, prevailing market conditions, the anticipated use of the proceeds of the offering which could change as a result of market conditions or for other reasons, and those other risks detailed from time to time under the caption “Risk Factors” and elsewhere in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 and in its Quarterly Report on Form 10-Q for the three months ended September 30, 2020, and in future SEC filings and reports of the Company. The Company undertakes no duty or obligation to update any forward-looking statements contained herein as a result of new information, future events or changes in its expectations or circumstances.

CONTACTS:

Investors:
Whitney Ijem
wijem@krystalbio.com

Source: Krystal Biotech, Inc.

FAQ

What is the purpose of Krystal Biotech's public offering on February 2, 2021?

The offering aims to raise funds for ongoing clinical trials, including B-VEC for DEB, and to advance other gene therapies.

How much does Krystal Biotech expect to raise in its public offering?

Krystal Biotech expects to raise approximately $125 million from the offering.

When is the expected closing date for Krystal Biotech's stock offering?

The offering is expected to close on or about February 5, 2021.

Who are the underwriters for Krystal Biotech's public offering?

Goldman Sachs, Cowen, and Evercore ISI are acting as joint book-running managers.