Vaxcyte Announces Pricing of $750 Million Public Offering

Rhea-AI Summary

Vaxcyte, Inc. (Nasdaq: PCVX) has announced the pricing of an underwritten public offering of common stock and pre-funded warrants, expecting to generate approximately $750.0 million in gross proceeds. The offering includes 10,937,500 shares of common stock and pre-funded warrants to purchase 781,250 shares of common stock, with a public offering price of $64.00 per share for common stock and $63.999 per pre-funded warrant. The underwriters have been granted a 30-day option to purchase up to an additional 1,757,812 shares of common stock at the public offering price per share. The offering is expected to close on February 2, 2024, subject to customary closing conditions. BofA Securities, Jefferies, Leerink Partners LLC, Evercore ISI, Guggenheim Securities, and Cantor are acting as joint book-running managers for the offering, with BTIG and Needham & Company as lead managers. Vaxcyte has filed a shelf registration statement with the SEC, and a preliminary prospectus supplement and accompanying prospectus have been filed. This press release does not constitute an offer to sell or a solicitation of an offer to buy these securities.

Insights

Financial Analyst

The announcement by Vaxcyte, Inc. regarding their public offering is a significant strategic financial move. By selling shares of common stock and pre-funded warrants, Vaxcyte is aiming to raise approximately $750 million. This capital influx is critical for the company's growth, as it can be allocated towards advancing their vaccine development pipeline, scaling up manufacturing capabilities, or pursuing strategic initiatives.

Investors should note the offering price of $64.00 per share and the nominal exercise price of the pre-funded warrants, which could imply a strong vote of confidence from the underwriters in Vaxcyte's valuation and future prospects. The decision to grant the underwriters a 30-day option to purchase additional shares could potentially stabilize the stock price post-offering or provide additional capital if exercised.

However, existing shareholders might be concerned about the dilutive effect of this offering, which could potentially decrease their ownership percentage and earnings per share. Moreover, the timing and size of the offering might reflect the company's capital needs and should be evaluated in the context of its cash burn rate and the capital-intensive nature of vaccine research and development.

Market Research Analyst

From a market perspective, the involvement of prominent financial institutions as joint book-running managers, such as BofA Securities and Jefferies, indicates a strong market appetite for biotech investments, particularly in the vaccine innovation sector. The fact that Vaxcyte's securities were registered on a shelf registration statement and are now being offered, demonstrates a pre-planned capital raising strategy that could cater to quick market movements and investor demand.

The vaccine market has been under intense scrutiny since the COVID-19 pandemic and companies like Vaxcyte that focus on bacterial diseases are of high interest due to the ongoing need for novel vaccines. The success of this offering could serve as a barometer for investor sentiment towards the vaccine industry and biotech sector at large.

It's also worth considering the broader market implications of this offering. If successful, it could lead to increased investor confidence in similar companies within the sector, potentially triggering more public offerings or investments in the field of vaccine innovation.

Legal Expert

From a legal standpoint, the compliance with SEC regulations, as evidenced by the filing of a preliminary prospectus supplement and the use of a shelf registration statement, is a crucial aspect of this offering. It ensures that the company is transparent with potential investors regarding the risks and benefits associated with the securities being offered.

The legal framework for public offerings is designed to protect investors and the integrity of the market. Vaxcyte's adherence to these regulations, including the stipulation that no sales will occur in jurisdictions where it would be unlawful, highlights the company's commitment to legal and regulatory compliance.

Prospective investors should closely review the final prospectus supplement for key information such as the company's financial condition, risk factors and management's discussion and analysis of financial condition and results of operations, which can provide deeper insights into the company's strategic direction and the potential risks of the investment.

SAN CARLOS, Calif., Jan. 30, 2024 (GLOBE NEWSWIRE) -- Vaxcyte, Inc. (Nasdaq: PCVX), a clinical-stage vaccine innovation company engineering high-fidelity vaccines to protect humankind from the consequences of bacterial diseases, announced today the pricing of an underwritten public offering of common stock and pre-funded warrants. Vaxcyte is selling 10,937,500 shares of common stock and pre-funded warrants to purchase 781,250 shares of common stock in the offering. The shares of common stock are being sold at a public offering price of $64.00 per share, and the pre-funded warrants are being sold at a public offering price of $63.999 per pre-funded warrant. The exercise price of the pre-funded warrants is $0.001 per share. The aggregate gross proceeds to Vaxcyte from this offering are expected to be approximately $750.0 million, before deducting underwriting discounts and commissions and other offering expenses, and excluding the exercise of any pre-funded warrants. All shares of common stock and pre-funded warrants to be sold in the offering will be offered by Vaxcyte. Vaxcyte has granted the underwriters a 30-day option to purchase up to an additional 1,757,812 shares of its common stock at the public offering price per share, less underwriting discounts and commissions.

The offering is expected to close on February 2, 2024, subject to the satisfaction of customary closing conditions.

BofA Securities, Jefferies, Leerink Partners LLC, Evercore ISI, Guggenheim Securities and Cantor are acting as joint book-running managers for the offering. BTIG and Needham & Company are acting as lead managers for the offering.

A shelf registration statement relating to the offered securities was filed with the Securities and Exchange Commission (SEC), and was automatically effective upon filing on July 2, 2021. A preliminary prospectus supplement and accompanying prospectus relating to the offering has been filed, and a final prospectus supplement and accompanying prospectus relating to the offering will be filed with the SEC and will be available on the SEC’s website, located at www.sec.gov. Copies of the final prospectus supplement and the accompanying prospectus relating to this offering may be obtained, when available, from BofA Securities NC1-022-02-25, Attention: Prospectus Department, 201 North Tryon Street, Charlotte, North Carolina 28255-0001 or by email at dg.prospectus_requests@bofa.com; Jefferies LLC, Attention: Equity Syndicate Department, 520 Madison Avenue, New York, New York 10022, by telephone at 1-877-821-7388, or by email at Prospectus_Department@Jefferies.com; Leerink Partners LLC, Attention: Syndicate Department, 53 State Street, 40th Floor, Boston, MA 02109, by email at syndicate@leerink.com or by phone at (800) 808-7525, ext. 6105; and Evercore Group L.L.C., Attention: Equity Capital Markets, 55 East 52nd Street, 35th Floor, New York, New York 10055, by telephone at 1-888-474-0200 or by email at ecm.prospectus@evercore.com.

This press release shall not constitute an offer to sell or a 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 Vaxcyte
Vaxcyte is a vaccine innovation company engineering high-fidelity vaccines to protect humankind from the consequences of bacterial diseases. The Company is developing broad-spectrum conjugate and novel protein vaccines to prevent or treat bacterial infectious diseases. Vaxcyte’s lead candidate, VAX-24, is a Phase 3-ready 24-valent, broad-spectrum, carrier-sparing pneumococcal conjugate vaccine (PCV) being developed for the prevention of invasive pneumococcal disease. VAX-31, the Company’s next-generation 31-valent PCV, is the broadest-spectrum PCV candidate in the clinic today.

Vaxcyte is re-engineering the way highly complex vaccines are made through modern synthetic techniques, including advanced chemistry and the XpressCF™ cell-free protein synthesis platform, exclusively licensed from Sutro Biopharma, Inc. Unlike conventional cell-based approaches, the Company’s system for producing difficult-to-make proteins and antigens is intended to accelerate its ability to efficiently create and deliver high-fidelity vaccines with enhanced immunological benefits. Vaxcyte’s pipeline also includes VAX-A1, a prophylactic vaccine candidate designed to prevent Group A Strep infections; VAX-PG, a therapeutic vaccine candidate designed to slow or stop the progression of periodontal disease; and VAX-GI, a vaccine program designed to prevent Shigella. Vaxcyte is driven to eradicate or treat invasive bacterial infections, which have serious and costly health consequences when left unchecked.

Contacts:

Janet Graesser, Vice President, Corporate Communications and Investor Relations
Vaxcyte, Inc.
917-685-8799
media@vaxcyte.com

Jennifer Zibuda, Senior Director, Investor Relations
Vaxcyte, Inc.
860-729-8902
investors@vaxcyte.com

FAQ

How many shares of common stock and pre-funded warrants are included in the offering by Vaxcyte, Inc. (PCVX)?

The offering includes 10,937,500 shares of common stock and pre-funded warrants to purchase 781,250 shares of common stock.

What is the public offering price for common stock and pre-funded warrants in the offering by Vaxcyte, Inc. (PCVX)?

The public offering price is $64.00 per share for common stock and $63.999 per pre-funded warrant.

How much gross proceeds are expected to be generated from the offering by Vaxcyte, Inc. (PCVX)?

The aggregate gross proceeds to Vaxcyte from this offering are expected to be approximately $750.0 million.

Who are the joint book-running managers for the offering by Vaxcyte, Inc. (PCVX)?

BofA Securities, Jefferies, Leerink Partners LLC, Evercore ISI, Guggenheim Securities, and Cantor are acting as joint book-running managers for the offering.

What is the expected closing date for the offering by Vaxcyte, Inc. (PCVX)?

The offering is expected to close on February 2, 2024, subject to customary closing conditions.