Modular Medical Announces Pricing of $8.2 Million Public Offering

Rhea-AI Summary

Modular Medical (Nasdaq:MODD) has priced an underwritten public offering of 5,450,573 shares of common stock at $1.50 per share, expected to raise approximately $8.2 million in gross proceeds. The offering was led by existing institutional investors, including Manchester Explorer, L.P., the company's largest shareholder. Titan Partners Group is acting as sole bookrunner. The proceeds will fund operations, working capital, and general corporate purposes, including capital expenditures. The offering is expected to close around November 25, 2024.

Positive

• Secured $8.2 million in additional funding through public offering
• Strong support from existing institutional investors including largest shareholder
• Company has FDA-cleared patch pump product

Negative

• Potential dilution for existing shareholders through issuance of 5,450,573 new shares
• Offering price of $1.50 per share indicates relatively low valuation

Insights

Financial Analyst

This $8.2 million public offering at $1.50 per share represents significant dilution, pricing 25% below the previous closing price. While the participation of CEO Jeb Besser through Manchester Explorer signals management confidence, the pricing suggests challenging market conditions. The offering will provide essential working capital for operations and capital expenditures, important for commercializing their FDA-cleared patch pump. However, with a market cap of $71.5 million, this 11.5% capital raise significantly impacts existing shareholders. The company's focus on affordable insulin pumps targets a promising market segment, but execution and cash management will be critical given the competitive medical device landscape.

SAN DIEGO, CA / ACCESSWIRE / November 21, 2024 / Modular Medical, Inc. (Nasdaq:MODD) ("Modular Medical" or the "Company"), an insulin delivery technology company with the first FDA-cleared patch pump designed specifically to target all adult "almost-pumpers" with its user-friendly and affordable design, today announced that it has priced an underwritten public offering (the "offering") of 5,450,573 shares of its common stock. The offering was led by existing institutional investors, including Manchester Explorer, L.P., which is the largest shareholder of the Company and is managed by Jeb Besser, Modular Medical's Chief Executive Officer. The shares of common stock are being sold at a price to the public of $1.50 per share of common stock, less underwriting discounts and commissions.

Titan Partners Group, a division of American Capital Partners, is acting as sole bookrunner for the offering.

The gross proceeds to the Company from the offering are expected to be approximately $8.2 million, before deducting underwriting discounts, commissions and estimated offering expenses payable by the Company. The Company intends to use the net proceeds from the offering to fund operations and for working capital and general corporate purposes, including capital expenditures. The offering is expected to close on or about November 25, 2024, subject to the satisfaction of customary closing conditions.

The securities described above were offered by Modular Medical pursuant to an effective "shelf" registration statement on Form S-3 (File No. 333-264193) previously filed with the Securities and Exchange Commission (the "SEC") on April 8, 2022, as amended on April 15, 2022, and declared effective by the SEC on April 19, 2022. The securities may be offered only by means of a prospectus. A preliminary prospectus supplement and the accompanying prospectus relating to and describing the terms of the offering have been filed with the SEC. Electronic copies of the preliminary prospectus and, when available, copies of the final prospectus supplement and the accompanying prospectus relating to the offering may be obtained by visiting the SEC's website at www.sec.gov or by contacting Titan Partners Group LLC, a division of American Capital Partners, LLC, 4 World Trade Center, 29^th Floor, New York, New York 10007, by phone at (929) 833-1246 or by email at prospectus@titanpartnersgrp.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 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 jurisdiction.

About Modular Medical

Modular Medical, Inc. (Nasdaq:MODD) is a development-stage medical device company that intends to launch the next generation of insulin delivery technology. Using its patented technologies, the company seeks to eliminate the tradeoff between complexity and efficacy, thereby making top quality insulin delivery both affordable and simple to learn. Its mission is to improve access to the highest standard of glycemic control for people with diabetes taking it beyond "superusers" and providing "diabetes care for the rest of us."

Modular Medical was founded by Paul DiPerna, a seasoned medical device professional and microfluidics engineer. Prior to founding Modular Medical, Mr. DiPerna was the founder (in 2005) of Tandem Diabetes and invented and designed its t:slim insulin pump. More information is available at https://modular-medical.com.

All trademarks mentioned herein are the property of their respective owners.

Forward-Looking Statements

This press release contains forward-looking statements that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified through the use of words such as "may," "might," "will," "intend," "should," "could," "can," "would," "continue," "expect," "believe," "anticipate," "estimate," "predict," "outlook," "potential," "plan," "seek," and similar expressions and variations or the negatives of these terms or other comparable terminology. Such forward-looking statements are subject to risks, trends, and uncertainties that could cause actual results to be materially different from the forward-looking statements contained in this press release, including the satisfaction of customary closing conditions related to the offering, the expected closing date of the offering and the expected use of proceeds, as well as other risk factors and business considerations described in Modular Medical's SEC filings, including its annual report on Form 10-K. Any forward-looking statements in this press release should be evaluated in light of these important risk factors. In addition, any forward-looking statements included in this press release represent Modular Medical's views only as of the date of its publication and should not be relied upon as representing its views as of any subsequent date. Modular Medical assumes no obligation to update these forward-looking statements, except as required by law.

Contact Information

Jeb Besser
Chief Executive Officer
Modular Medical, Inc.
+1 (617) 399-1741
IR@modular-medical.com

SOURCE: Modular Medical, Inc.

View the original press release on accesswire.com

FAQ

How much did Modular Medical (MODD) raise in its November 2024 public offering?

Modular Medical raised approximately $8.2 million in gross proceeds through a public offering of 5,450,573 shares priced at $1.50 per share.

What is the expected closing date for Modular Medical's (MODD) November 2024 public offering?

The public offering is expected to close on or about November 25, 2024, subject to customary closing conditions.

How will Modular Medical (MODD) use the proceeds from its November 2024 offering?

The company plans to use the net proceeds to fund operations, working capital, general corporate purposes, and capital expenditures.

Who led the November 2024 public offering for Modular Medical (MODD)?

The offering was led by existing institutional investors, including Manchester Explorer, L.P., with Titan Partners Group acting as sole bookrunner.