Profound Medical Announces Non-Brokered Private Placement
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Insights
The announcement of Profound Medical Corp's non-brokered private placement is a strategic financial move that can be expected to influence the company's capital structure and liquidity. The injection of approximately US$2,937,502 in capital, in exchange for 391,667 common shares at a price of US$7.50 per share, represents a direct infusion of funds without the involvement of an intermediary. This approach often results in lower issuance costs and could be indicative of strong investor confidence, as the subscribers are existing institutional investors.
However, the pricing of shares at US$7.50 warrants attention. Investors should compare this price to the current market price and historical pricing trends to assess the attractiveness of the deal for both the company and the participating investors. The statutory hold period of four months and one day is a standard regulatory measure, which temporarily restricts the liquidity of the newly issued shares, potentially reducing short-term market volatility but also limiting investors' flexibility.
The stated use of proceeds—funding the commercialization of the TULSA-PRO® system in the U.S., global development and commercialization of the TULSA-PRO® and Sonalleve® systems, along with working capital and general corporate purposes—provides a clear direction for the company's growth strategy. This infusion of capital is expected to enhance the company's ability to capture market share in the medical device sector, particularly in the therapeutic ultrasound systems market. However, stakeholders should monitor the efficiency and effectiveness of the capital deployment to ensure that these strategic initiatives translate into increased shareholder value over time.
Profound Medical Corp's focus on commercializing the TULSA-PRO® and Sonalleve® systems highlights the company's commitment to innovation in non-invasive therapeutic ultrasound technologies. The TULSA-PRO® system, which is used for prostate disease treatments and the Sonalleve® system, which is designed for uterine fibroid and palliative pain treatment, cater to significant and growing healthcare needs. The funding from this private placement could accelerate the market penetration of these systems.
As the healthcare industry continues to shift towards less invasive treatment options, the demand for such technologies is likely to increase. The market's response to Profound Medical Corp's strategic direction will be an important indicator of investor sentiment towards the company's potential to disrupt the current standard of care. The success of their commercialization efforts could lead to an increased market share and a stronger competitive position.
It is also critical to consider the broader market dynamics, including regulatory hurdles, the competitive landscape and reimbursement challenges that can impact the adoption rate of new medical technologies. A thorough analysis of these factors is essential to understand the potential market impact of Profound Medical Corp's growth initiatives and the subsequent effect on the company's financial performance.
The capital raised through this private placement is earmarked for the continued development and commercialization of Profound Medical Corp's TULSA-PRO® and Sonalleve® systems. From a medical research perspective, the effectiveness and safety profile of these systems are of paramount importance. The TULSA-PRO® system represents a novel approach to prostate disease by using directional ultrasound to ablate pathological tissue, while the Sonalleve® system utilizes MR-HIFU (Magnetic Resonance-guided High-Intensity Focused Ultrasound) technology to treat uterine fibroids non-invasively.
Investments in the development of these systems could lead to advancements in treatment efficacy and patient outcomes, which are critical factors in gaining regulatory approvals, clinician adoption and market acceptance. The potential long-term impact on the healthcare system includes reduced recovery times, lower complication rates and overall cost savings, which can be substantial benefits to all stakeholders—patients, providers and insurers alike.
However, continuous investment in research and development is crucial, as the medical device industry is highly competitive and subject to rapid technological advancements. The ability of Profound Medical Corp to innovate and improve upon existing technologies will likely be a significant determinant of their long-term success in the market.
TORONTO, Jan. 16, 2024 (GLOBE NEWSWIRE) -- Profound Medical Corp. (TSX:PRN; NASDAQ:PROF) ("Profound" or the "Company") is pleased to announce that the Company has entered into subscription agreements, dated as of January 16, 2024, with certain existing Canadian institutional investors, in connection with a non-brokered private placement (the "Private Placement") for aggregate gross proceeds of approximately US
In connection with the closing of the Private Placement, the Company is expected to issue an aggregate of 391,667 common shares in the capital of the Company ("Common Shares") at a price of US
The closing of the Private Placement is expected to occur on or about January 17, 2024, subject to customary closing conditions.
The Company is offering the Common Shares in Canada only. The Common Shares have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act") or any U.S. state securities laws and may not be offered or sold in the United States absent registration or an available exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities referenced in this press release, in any jurisdiction in which such offer, solicitation or sale would be unlawful.
About Profound Medical Corp.
Profound is a commercial-stage medical device company that develops and markets customizable, incision-free therapies for the ablation of diseased tissue.
Profound is commercializing TULSA-PRO®, a technology that combines real-time MRI, robotically-driven transurethral ultrasound and closed-loop temperature feedback control. TULSA-PRO® is designed to provide customizable and predictable radiation-free ablation of a surgeon-defined prostate volume while actively protecting the urethra and rectum to help preserve the patient’s natural functional abilities. TULSA-PRO® has the potential to be a flexible technology in customizable prostate ablation, including intermediate stage cancer, localized radio-recurrent cancer, retention and hematuria palliation in locally advanced prostate cancer, and the transition zone in large volume benign prostatic hyperplasia ("BPH"). TULSA-PRO® is CE marked, Health Canada approved, and 510(k) cleared by the U.S. Food and Drug Administration ("FDA").
Profound is also commercializing Sonalleve®, an innovative therapeutic platform that is CE marked for the treatment of uterine fibroids and palliative pain treatment of bone metastases. Sonalleve® has also been approved by the China National Medical Products Administration for the non-invasive treatment of uterine fibroids and has FDA approval under a Humanitarian Device Exemption for the treatment of osteoid osteoma. The Company is in the early stages of exploring additional potential treatment markets for Sonalleve® where the technology has been shown to have clinical application, such as non-invasive ablation of abdominal cancers and hyperthermia for cancer therapy.
Forward-Looking Statements
This release includes forward-looking statements regarding Profound and its business which may include, but are not limited to, statements with respect to the Private Placement (including size, pricing and closing date) and the expectations regarding the efficacy of Profound’s technology in the treatment of prostate cancer, BPH, uterine fibroids, palliative pain treatment and osteoid osteoma and the expected use of proceeds from the Private Placement. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "is expected", "expects", "scheduled", "intends", "contemplates", "anticipates", "believes", "proposes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations of the management of Profound. The forward-looking events and circumstances discussed in this release, may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Company, including risks regarding the Private Placement (including that the Private Placement may not close and/or that the Company’s use of proceeds of the Private Placement may differ from those indicated), the medical device industry, regulatory approvals, reimbursement, economic factors, the equity markets generally and risks associated with growth and competition. Although Profound has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement can be guaranteed. In addition, there is uncertainty about the spread of the COVID-19 virus and the impact it will have on Profound’s operations, the demand for its products, global supply chains and economic activity in general. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Profound undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, other than as required by law.
For further information, please contact:
Stephen Kilmer
Investor Relations
skilmer@profoundmedical.com
T: 647.872.4849
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