TransCode Therapeutics, Inc. Announces Closing of Registered Direct Offering

Rhea-AI Summary

TransCode Therapeutics (RNAZ) has completed a registered direct offering, raising $10 million in gross proceeds through the sale of 10,250,000 shares of common stock and accompanying warrants. The offering was priced at $0.98 per share at-the-market under Nasdaq rules, with each share accompanied by warrants to purchase additional shares.

The RNA oncology company plans to utilize the proceeds primarily for product development activities, including clinical trials of their lead therapeutic candidate TTX-MC138, IND-enabling studies, working capital, and general corporate purposes. ThinkEquity served as the sole placement agent for this offering, which was conducted under an effective shelf registration statement filed with the SEC.

Positive

• Secured $10 million in gross proceeds for product development
• Funding enables advancement of lead candidate TTX-MC138 clinical trials
• Successfully completed at-market offering maintaining Nasdaq compliance

Negative

• Significant shareholder dilution with 10.25M new shares issued
• Additional potential dilution from 10.25M warrants
• Offering price of $0.98 represents a discount to market price

Insights

Financial Analyst

TransCode's $10 million registered direct offering represents a significant capital raise relative to the company's tiny $476K market cap. The offering price of $0.98 per share represents a substantial 41% premium to the current share price of $0.6932, which is highly unusual in micro-cap biotech financings where discounts are typically the norm.

This financing structure suggests strong support from select investors, but comes with considerable dilution. The 10.25 million new shares will dramatically increase the outstanding share count. Additionally, the equal number of warrants creates potential for future dilution if exercised, though this would bring in additional capital.

While the funding provides crucial capital to advance TTX-MC138 toward clinical trials and support IND-enabling studies, investors should recognize this represents a double-edged sword. The cash infusion extends TransCode's operational runway but at the cost of significant equity dilution. For a company with such a small market cap, this offering dramatically transforms the capital structure while providing essential funding for its RNA oncology pipeline development.

Biotech Investment Specialist

This $10 million raise provides TransCode with essential capital to advance its lead RNA therapeutic candidate TTX-MC138 toward clinical development. For micro-cap oncology companies, securing adequate funding for IND-enabling studies represents a critical milestone, as these preclinical studies determine whether a candidate can proceed to human trials.

The capital infusion comes at a pivotal moment in TransCode's development trajectory. RNA therapeutics in oncology face significant technical challenges in delivery and targeting, requiring substantial resources for development. This funding potentially allows TransCode to generate crucial proof-of-concept data that could validate their approach.

However, the financing structure reveals both the opportunity and challenge TransCode faces. While the premium pricing suggests investor confidence, the massive share count increase relative to market cap indicates the difficult position of early-stage public biotech companies needing to fund R&D pipelines. For investors, this represents the fundamental biotech paradox – necessary capital to advance promising science comes at the cost of significant ownership dilution, with clinical success still uncertain and likely years away.

BOSTON, March 25, 2025 /PRNewswire/ -- TransCode Therapeutics, Inc. (Nasdaq: RNAZ), ("TransCode" or the "Company"), the RNA oncology company committed to more effectively treating cancer using RNA therapeutics, today announced the closing of its previously announced sale of 10,250,000 shares of its common stock and warrants to purchase up to 10,250,000 shares of common stock priced at-the-market under Nasdaq rules, at a purchase price of $0.98 per share and accompanying warrant, for gross proceeds of approximately $10 million, before deducting placement agent fees and offering expenses payable by the Company.

The Company intends to use the proceeds from the offering primarily for product development activities, including one or more clinical trials with TTX-MC138, its lead therapeutic candidate, including related IND-enabling studies, and for working capital and other general corporate purposes.

ThinkEquity acted as sole placement agent for the offering.

The offering was made pursuant to an effective shelf registration statement that has been filed with the U.S. Securities and Exchange Commission (the "SEC"). The final prospectus supplement relating to the offering was filed with the SEC and is available on the SEC's website at http://www.sec.gov. Copies of the final prospectus supplement and the accompanying prospectus relating to the offering may be obtained from ThinkEquity, 17 State Street, 41^st Floor, New York, New York 10004 Attention: Prospectus Department.

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 other 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 other jurisdiction.

About TransCode Therapeutics, Inc.
TransCode is a clinical-stage oncology company focused on treating metastatic disease. The Company is committed to defeating cancer through the intelligent design and effective delivery of RNA therapeutics based on its proprietary TTX nanoparticle platform. The Company's lead therapeutic candidate, TTX-MC138, is focused on treating metastatic tumors which overexpress microRNA-10b, a unique, well-documented biomarker of metastasis. In addition, TransCode has a portfolio of other first-in-class RNA therapeutic candidates designed to overcome the challenges of RNA delivery and thus unlock therapeutic access to a variety of novel genetic targets that could be relevant to treating a variety of cancers.

Forward-Looking Statements
This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements concerning the timing, conduct and results of TransCode's clinical trials, statements about microRNAs and their involvement in cancer, and statements concerning the therapeutic potential of TransCode's TTX-MC138. Any forward-looking statements in this press release are based on management's current expectations of future events and are subject to a number of risks and uncertainties that could cause actual results to differ materially and adversely from those set forth in or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: the risks associated with drug discovery and development; the risk that the results of clinical trials will not be consistent with TransCode's pre-clinical studies or expectations or with results from previous clinical trials; risks associated with the conduct of clinical trials; risks associated with TransCode's financial condition and its need to obtain additional funding to support its business activities, including TransCode's ability to continue as a going concern; risks associated with the timing and outcome of TransCode's planned regulatory submissions; risks associated with obtaining, maintaining and protecting intellectual property; risks associated with TransCode's ability to enforce its patents against infringers and defend its patent portfolio against challenges from third parties; risks of competition from other companies developing products for similar uses; risks associated with TransCode's dependence on third parties; and risks associated with geopolitical events and pandemics, including military conflicts. For a discussion of these and other risks and uncertainties, and other important factors, any of which could cause TransCode's actual results to differ from those contained in or implied by the forward-looking statements, see the section entitled "Risk Factors" in TransCode's Annual Report on Form 10-K for the year ended December 31, 2023, as well as discussions of potential risks, uncertainties and other important factors in any subsequent TransCode filings with the Securities and Exchange Commission. All information in this press release is as of the date of this release; TransCode undertakes no duty to update this information unless required by law.

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SOURCE TransCode Therapeutics, Inc.

FAQ

How much did TransCode Therapeutics (RNAZ) raise in their March 2025 offering?

TransCode Therapeutics raised $10 million in gross proceeds through a registered direct offering priced at $0.98 per share.

What is the structure of RNAZ's March 2025 registered direct offering?

The offering included 10,250,000 shares of common stock and warrants to purchase up to 10,250,000 additional shares, priced at $0.98 per share and accompanying warrant.

How will TransCode Therapeutics use the proceeds from their 2025 offering?

The proceeds will fund product development activities, including clinical trials of TTX-MC138, IND-enabling studies, working capital, and general corporate purposes.

Who was the placement agent for RNAZ's March 2025 offering?

ThinkEquity acted as the sole placement agent for the offering.