Avidity Biosciences Announces Proposed Public Offering of Common Stock

Rhea-AI Summary

Avidity Biosciences (Nasdaq: RNA), a biopharmaceutical company developing Antibody Oligonucleotide Conjugates (AOCs™), has announced plans for a $250 million public offering of common stock. The company also intends to grant underwriters a 30-day option to purchase up to an additional $37.5 million of shares. Leerink Partners and TD Cowen are acting as joint bookrunning managers for the offering.

Avidity plans to use the net proceeds to fund clinical programs, advance AOC platform research and development, and for working capital and general corporate purposes. The offering is subject to market conditions, and there is no assurance regarding its completion or terms.

Positive

• Potential to raise up to $287.5 million in capital
• Funds to be used for clinical program development and AOC platform advancement
• Strengthening of the company's financial position for future growth

Negative

• Potential dilution of existing shareholders' equity
• Uncertainty regarding the completion and final terms of the offering
• Increased financial obligations and pressure to deliver results

Insights

Financial Analyst

Avidity Biosciences' proposed $250 million public offering of common stock, with an additional $37.5 million option for underwriters, is a significant capital-raising move. This infusion of funds could substantially strengthen the company's financial position, potentially accelerating its clinical programs and AOC platform development. However, investors should note that this will lead to dilution of existing shareholders' stakes.

The involvement of reputable underwriters like Leerink Partners and TD Cowen lends credibility to the offering. The company's intention to use the proceeds for clinical development and R&D is promising, as it aligns with long-term value creation. However, the success of this strategy hinges on the effectiveness of Avidity's AOC technology and the progress of its clinical trials.

Key considerations: 1) Impact on cash runway, 2) Potential for accelerated development timelines and 3) Market reception of the offering price when announced.

Biotech Research Analyst

Avidity's decision to raise capital through a public offering suggests confidence in their Antibody Oligonucleotide Conjugates (AOCs™) platform. This novel class of RNA therapeutics could potentially address limitations of existing RNA-based treatments, offering improved cellular uptake and tissue-specific targeting.

The substantial funding sought ($250 million plus a potential $37.5 million) indicates ambitious development plans. This could accelerate multiple clinical programs simultaneously, potentially leading to a diversified pipeline. However, investors should be aware that the RNA therapeutics field is highly competitive, with giants like Alnylam and Ionis already established.

Critical factors to monitor: 1) Upcoming clinical data readouts, 2) Progress in expanding AOC applications and 3) Partnerships or collaborations that could validate the technology.

Market Research Analyst

The timing of Avidity's offering is intriguing, coming amidst a challenging market for biotech fundraising. This move could signal management's belief in near-term catalysts or a strategic need to fortify the balance sheet. The market's reception to this offering will be a important indicator of investor sentiment towards Avidity and potentially the broader RNA therapeutics sector.

Investors should pay attention to the pricing of the offering when announced. A significant discount could suggest weak demand, while pricing close to market value would indicate confidence. The 15% additional option for underwriters is standard but could provide insight into demand if fully exercised.

Market factors to watch: 1) Comparative valuations within the RNA therapeutics space, 2) General biotech sector trends and 3) Any shifts in investor appetite for early-stage biotech companies following this offering.

SAN DIEGO, Aug. 13, 2024 /PRNewswire/ -- Avidity Biosciences, Inc. (Nasdaq: RNA), a biopharmaceutical company committed to delivering a new class of RNA therapeutics called Antibody Oligonucleotide Conjugates (AOCs™), today announced that it intends to offer and sell, subject to market and other conditions, $250.0 million of shares of its common stock in an underwritten public offering. In addition, Avidity intends to grant the underwriters a 30-day option to purchase up to an additional $37.5 million of shares of common stock. All of the shares to be sold in the offering are to be sold by Avidity. There can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

Avidity intends to use the net proceeds from this offering, together with its existing cash, cash equivalents and marketable securities, to fund the development of its clinical programs, to advance research and development associated with its AOC platform and for working capital and general corporate purposes.

Leerink Partners and TD Cowen are acting as joint bookrunning managers for the offering.

The securities described above are being offered by Avidity pursuant to a shelf registration statement that became automatically effective upon filing with the Securities and Exchange Commission (SEC). A preliminary prospectus supplement and accompanying prospectus relating to this offering will be filed with the SEC. When available, copies of the preliminary prospectus supplement and the accompanying prospectus relating to this offering may be obtained from: Leerink Partners LLC c/o Syndicate Department, 53 State Street, 40th Floor, Boston, MA 02109, or by telephone at (800) 808-7525 ext. 6105, or by email at syndicate@leerink.com, or TD Securities (USA) LLC, 1 Vanderbilt Avenue, New York, NY 10017, by telephone at (855) 495-9846, or by email at TD.ECM_Prospectus@tdsecurities.com. Electronic copies of the preliminary prospectus supplement and accompanying prospectus will also be available on the website of the SEC at http://www.sec.gov.

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 these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.

About Avidity

Avidity Biosciences, Inc.'s mission is to profoundly improve people's lives by delivering a new class of RNA therapeutics - Antibody Oligonucleotide Conjugates (AOCs™). Avidity is revolutionizing the field of RNA with its proprietary AOCs, which are designed to combine the specificity of monoclonal antibodies with the precision of oligonucleotide therapies to address targets and diseases previously unreachable with existing RNA therapies. Utilizing its proprietary AOC platform, Avidity demonstrated the first-ever successful targeted delivery of RNA into muscle and is leading the field with clinical development programs for three rare muscle diseases: myotonic dystrophy type 1 (DM1), Duchenne muscular dystrophy (DMD) and facioscapulohumeral muscular dystrophy (FSHD). Avidity is broadening the reach of AOCs with its advancing and expanding pipeline including programs in cardiology and immunology through internal discovery efforts and key partnerships. Avidity is headquartered in San Diego, CA.

Forward-Looking Statements

Avidity cautions readers that statements contained in this press release regarding matters that are not historical facts are forward-looking statements. These statements are based on the company's current beliefs and expectations. Such forward-looking statements include, but are not limited to, statements regarding Avidity's expectations of the completion, timing and size of the proposed public offering, the grant of the option to the underwriters and the anticipated use of proceeds from the offering. The inclusion of forward-looking statements should not be regarded as a representation by Avidity that any of its plans will be achieved. Actual results may differ from those set forth in this press release due to the risks and uncertainties associated with market conditions and the satisfaction of customary closing conditions related to the proposed public offering, as well as risks and uncertainties inherent in Avidity's business described in prior press releases and in filings with the SEC, including under the heading "Risk Factors" in Avidity's most recent annual report on Form 10-K and any subsequent filings with the SEC. Avidity cautions readers not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and Avidity undertakes no obligation to update such statements to reflect events that occur or circumstances that arise after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Company Contact:

Mike MacLean
(619) 837-5014
investors@aviditybio.com

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SOURCE Avidity Biosciences, Inc.

FAQ

How much is Avidity Biosciences (RNA) planning to raise in its public offering?

Avidity Biosciences (RNA) is planning to raise $250 million in its public offering, with an additional option for underwriters to purchase up to $37.5 million in shares, potentially totaling $287.5 million.

What will Avidity Biosciences (RNA) use the proceeds from the offering for?

Avidity Biosciences (RNA) intends to use the net proceeds to fund the development of its clinical programs, advance research and development of its AOC platform, and for working capital and general corporate purposes.

Who are the bookrunning managers for Avidity Biosciences' (RNA) public offering?

Leerink Partners and TD Cowen are acting as joint bookrunning managers for Avidity Biosciences' (RNA) public offering.

When will Avidity Biosciences (RNA) file the prospectus supplement for the offering?

Avidity Biosciences (RNA) will file a preliminary prospectus supplement and accompanying prospectus relating to the offering with the SEC. The exact date is not specified in the press release.