Organovo Holdings, Inc. Announces Pricing of $5.25 Million Public Offering

Rhea-AI Summary

Organovo Holdings, Inc. announced the pricing of a public offering of 6,562,500 shares of common stock and common warrants, expecting gross proceeds of $5.25 million. The offering price per share is $0.80 with common warrants exercisable at the same price. The offering is set to close on May 13, 2024. JonesTrading Institutional Services is the placement agent for the offering.

Insights

Financial Analyst

The announcement by Organovo regarding its public offering of $5.25 million includes both the issuance of new shares and common warrants with an exercise price equal to the offering share price. This offering will inject liquidity into the company, enabling further investment into their 3D human tissue technology. However, the dilutive effect of increasing the number of shares outstanding could exert downward pressure on the stock price in the short term. Considering the company's clinical stage status, the capital increase is likely aimed at funding ongoing research and development activities, which may take years to materialize into marketable products. Investors should weigh the potential long-term benefits of technological advances against the immediate dilutive impact and the inherent risks of clinical development. As such, the rating here is neutral, with long-term value hinging on successful clinical outcomes which are uncertain at this stage.

Biotechnology Market Analyst

With this new funding, Organovo is likely to continue its focus on 3D bioprinting technologies. The biotech market is highly competitive and Organovo's success will depend on its ability to move through clinical trials effectively and ultimately gain FDA approval for its products. This offering indicates Organovo's need for capital to sustain its operations but does not guarantee success. It is essential for investors to consider industry benchmarks for development timelines and success rates when assessing the potential value of their investment. The pricing of the offering at $0.80 per share, paired with common warrants, is designed to appeal to investors looking for both immediate and future equity opportunities. Market response to this type of offering will reflect confidence in Organovo’s potential for future growth. From an industry perspective, the rating is slightly positive as it allows the company to advance its research, but comes with the caveats of clinical and regulatory risk.

SAN DIEGO, May 08, 2024 (GLOBE NEWSWIRE) -- Organovo Holdings, Inc. (Nasdaq: ONVO) (“Organovo” or the “Company”), a clinical stage biotechnology company focused on developing novel treatment approaches based on demonstration of clinical promise in three-dimensional (3D) human tissues, today announced the pricing of a public offering consisting of 6,562,500 shares of common stock (or pre-funded warrants in lieu thereof) and common warrants to purchase up to an aggregate of 6,562,500 shares of its common stock, at a combined public offering price per share of common stock and accompanying common warrant to purchase one share of common stock of $0.80 (or $0.799 per share subject to pre-funded warrants and accompanying warrant to purchase one share of common stock).

The common warrants will have an exercise price of $0.80 per share, will be immediately exercisable upon issuance and have a term of five years after their original issuance date. The gross proceeds from the offering, before deducting placement agent fees and other offering expenses payable by the Company, are expected to be $5.25 million (excluding any proceeds that may be received upon the exercise of the common warrants). The offering is expected to close on or about May 13, 2024, subject to the satisfaction of customary closing conditions.

JonesTrading Institutional Services LLC (“Jones”) is acting as the exclusive placement agent for the offering.

The securities described above are being offered pursuant to a registration statement on Form S-1 (File No. 333-278668), as amended, that was declared effective by the Securities and Exchange Commission (the “SEC”) on May 8, 2024. The offering is being made only by means of a prospectus forming part of the effective registration statement relating to the offering. A preliminary prospectus relating to the offering has been filed with the SEC. Electronic copies of the final prospectus, when available, may be obtained on the SEC’s website at http://www.sec.gov and may also be obtained, when available, by contacting Jones, 325 Hudson Street, 6^th Floor, New York, New York 10013, or by telephone at (212) 907-5332, or by email at JTCM@jonestrading.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 Organovo Holdings, Inc.

Organovo is a clinical stage biotechnology company that is developing drugs that are demonstrated to be effective in three-dimensional (3D) human tissues as candidates for drug development. The company’s lead molecule, FXR314, is on the path for Phase 2 investigation in inflammatory bowel disease and has applications in metabolic liver disease and oncology. The company has proprietary technology used to build 3D human tissues that mimic key aspects of native human tissue composition, architecture, function, and disease.

Forward-Looking Statements

Any statements contained in this press release that do not describe historical facts constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995, including statements with respect to the public offering. No assurance can be given that the public offering discussed above will be completed. Any forward-looking statements contained herein are based on current expectations but are subject to a number of risks and uncertainties, including, but not limited to, those risks and uncertainties related to market and other conditions and satisfaction of customary closing conditions related to the public offering. These risks and uncertainties and other factors are identified and described in more detail in the Company’s filings with the SEC, including its Annual Report on Form 10-K filed with the SEC on July 14, 2023, as such risk factors are updated in its most recently filed Quarterly Report on Form 10-Q filed with the SEC on February 8, 2024 and the Registration Statement on Form S-1 (File No. 333-278668), as amended. You should not place undue reliance on these forward-looking statements, which speak only as of the date that they were made. These cautionary statements should be considered with any written or oral forward-looking statements that the Company may issue in the future. Except as required by applicable law, including the securities laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to reflect actual results, later events, or circumstances or to reflect the occurrence of unanticipated events. 

For More Information:

Contact
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FAQ

How many shares are included in Organovo Holdings, Inc.'s public offering?

The public offering consists of 6,562,500 shares of common stock.

What is the expected gross proceeds from Organovo Holdings, Inc.'s public offering?

The expected gross proceeds from the offering are $5.25 million.

When is the closing date for Organovo Holdings, Inc.'s public offering?

The offering is expected to close on or about May 13, 2024.

Who is the exclusive placement agent for Organovo Holdings, Inc.'s public offering?

JonesTrading Institutional Services is the exclusive placement agent for the offering.

What is the price per share in Organovo Holdings, Inc.'s public offering?

The price per share in the offering is $0.80.