Larimar Therapeutics Announces Proposed Underwritten Public Offering

Rhea-AI Summary

Larimar Therapeutics, Inc. initiates a public offering of common stock and pre-funded warrants to support the development of pipeline candidates and for general corporate purposes.

Insights

Financial Analyst

The commencement of an underwritten public offering by Larimar Therapeutics, Inc. indicates a strategic move to raise capital for the company's operations and research development. The offering includes both shares of common stock and pre-funded warrants, which are financial instruments allowing investors to purchase shares at a later date. This dual approach provides flexibility for investors with different investment strategies and timelines.

The decision to grant underwriters a 30-day option to purchase an additional 15% of the securities suggests a potential for over-allotment, which can be indicative of strong investor interest or a safeguard against shortfalls in capital raised. The involvement of reputable financial institutions as joint bookrunning managers and lead manager could be seen as a vote of confidence in the offering's structure and the company's prospects.

Investors and stakeholders should note that the proceeds are earmarked for the development of nomlabofusp (CTI-1601) and other pipeline candidates. The explicit allocation of funds to these projects underscores their importance to Larimar's strategy and potential future revenue streams. However, the caveat regarding market and other conditions serves as a reminder of the inherent uncertainties in such offerings.

Biotechnology Industry Analyst

Larimar's focus on complex rare diseases places it within a high-risk, high-reward sector of the biotechnology industry. The development of nomlabofusp (CTI-1601) represents a significant part of the company's pipeline and future value proposition. As a clinical-stage biotechnology company, the success of its clinical trials and the progression towards regulatory approval are critical milestones that can significantly influence the company's valuation and market potential.

Investors should be aware of the regulatory environment and the challenges associated with bringing new treatments to market, especially in the rare disease space where patient populations are limited and the cost of treatment can be high. The use of a shelf registration statement also highlights the company's proactive approach to capital raising, allowing for quicker access to the market when conditions are favorable.

Market Research Analyst

The biotech sector is known for its volatility and Larimar's public offering could reflect broader market trends in investor appetite for biotech ventures. The timing and success of the offering may hinge on market conditions, investor sentiment towards the sector and the company's ability to communicate the potential of its product pipeline to investors. Market research would indicate that successful funding rounds are often predicated on strong underlying science, clear commercialization strategies and a track record of meeting development milestones.

Given the competitive nature of the biotech industry, Larimar's ability to secure funding is also a testament to its perceived potential by the market. The offering's outcome will likely influence the company's stock performance in the short term, with long-term implications tied to the successful deployment of the raised capital towards its intended uses.

BALA CYNWYD, Pa., Feb. 13, 2024 (GLOBE NEWSWIRE) -- Larimar Therapeutics, Inc. (“Larimar”) (Nasdaq: LRMR), a clinical-stage biotechnology company focused on developing treatments for complex rare diseases, today announced that it has commenced an underwritten public offering of shares of its common stock and, in lieu of shares of common stock to certain investors that so choose, pre-funded warrants to purchase shares of common stock. In addition, Larimar expects to grant the underwriters a 30-day option to purchase up to an additional 15% of the securities to be sold in the proposed offering at the public offering price, less underwriting discounts and commissions. All shares of common stock and pre-funded warrants in the proposed offering are to be sold by Larimar. The proposed offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or the actual size or terms of the proposed offering.

Leerink Partners, Citigroup and Guggenheim Securities are acting as joint bookrunning managers for the proposed offering. LifeSci Capital is acting as lead manager for the proposed offering.

Larimar intends to use the net proceeds from the proposed offering to support the development of nomlabofusp (CTI-1601) and other pipeline candidates, and for working capital and general corporate purposes, including research and development expenses.

The proposed offering is being made pursuant to a shelf registration statement on Form S-3 (File No. 333- 268312) that was declared effective by the Securities and Exchange Commission (“SEC”) on November 21, 2022. A preliminary prospectus supplement and accompanying prospectus relating to the proposed offering will be filed with the SEC and will be available for free on the SEC’s website at www.sec.gov. Copies of the preliminary prospectus supplement and the accompanying prospectus relating to the proposed offering may be obtained, when available, from Leerink Partners LLC, Attention: Syndicate Department, 53 State Street, 40th Floor, Boston, Massachusetts 02109, by telephone at (800) 808-7525, ext. 6105 or by email at syndicate@leerink.com; or Citigroup, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, or by telephone at (800) 831-9146; or Guggenheim Securities, LLC, Attention: Equity Syndicate Department, 330 Madison Avenue, 8^th Floor, New York, New York 10017, by telephone at (212) 518-9544 or by email at GSEquityProspectusDelivery@guggenheimpartners.com.

This press release does 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 that state or jurisdiction.

About Larimar Therapeutics, Inc.

Larimar Therapeutics, Inc. (Nasdaq: LRMR), is a clinical-stage biotechnology company focused on developing treatments for complex rare diseases. Larimar’s lead compound, nomlabofusp, is being developed as a potential treatment for Friedreich’s ataxia. Larimar also plans to use its intracellular delivery platform to design other fusion proteins to target additional rare diseases characterized by deficiencies in intracellular bioactive compounds.

Caution Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “might,” “will,” “should,” “believe,” “expect,” “anticipate,” “estimate,” “continue,” “predict,” “forecast,” “project,” “plan,” “intend,” or similar expressions, or statements regarding intent, belief, or current expectations are forward-looking statements and reflect the current beliefs of Larimar’s management. Such forward-looking statements include, without limitation, statements relating to the completion, timing, size, use of proceeds of the proposed public offering on the anticipated terms or at all and the grant of the option to the underwriters to purchase additional shares of common stock. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors that could cause actual results and events to differ materially and adversely from those indicated by such forward-looking statements including, among others: risks and uncertainties related to market conditions and the satisfaction of customary closing conditions related to the proposed public offering, completion of the proposed public offering on the anticipated terms or at all, and other risks and uncertainties related to the proposed public offering, as well as the risks and uncertainties set forth in the “Risk Factors” section and elsewhere in the preliminary prospectus supplement related to the proposed public offering filed with the Securities and Exchange Commission and in our other filings with the Securities and Exchange Commission and available at www.sec.gov, including but not limited to Larimar’s periodic reports, including Larimar’s most recent annual report on Form 10-K, subsequent quarterly reports on Form 10-Q and current reports on Form 8-K. Any forward-looking statements that we make in this announcement speak only as of the date of this press release, and Larimar assumes no obligation to update forward-looking statements whether as a result of new information, future events or otherwise after the date of this press release, except as required under applicable law.

Investor Contact:
Joyce Allaire
LifeSci Advisors
jallaire@lifesciadvisors.com
(212) 915-2569

Company Contact:
Michael Celano
Chief Financial Officer
mcelano@larimartx.com
(484) 414-2715

FAQ

What did Larimar Therapeutics announce recently?

Larimar Therapeutics, Inc. announced the commencement of an underwritten public offering of shares of its common stock and pre-funded warrants to certain investors.

What is the ticker symbol for Larimar Therapeutics?

The ticker symbol for Larimar Therapeutics is LRMR.

How will Larimar Therapeutics use the net proceeds from the proposed offering?

Larimar Therapeutics intends to use the net proceeds to support the development of nomlabofusp (CTI-1601) and other pipeline candidates, as well as for working capital and general corporate purposes.

Who are the joint bookrunning managers for the proposed offering?

Leerink Partners, Citigroup, and Guggenheim Securities are acting as joint bookrunning managers for the proposed offering.

What is the shelf registration statement number for the proposed offering?

The shelf registration statement number for the proposed offering is Form S-3 (File No. 333-268312) declared effective by the SEC on November 21, 2022.