Sera Prognostics Announces Proposed Public Offering

Rhea-AI Summary

Sera Prognostics (NASDAQ: SERA) has announced a proposed underwritten public offering of its Class A common stock and pre-funded warrants. The company will grant underwriters a 30-day option to purchase additional shares up to 15% of the total offering. Jefferies, TD Cowen, William Blair are acting as joint book-running managers, with RBC Capital Markets as a bookrunner.

The net proceeds will be used to:

• Expand commercial infrastructure in the United States
• Accelerate European Union expansion preparations
• Fund studies to increase PreTRM test adoption
• Potential FDA submission for broad PreTRM test approval
• General corporate purposes

The offering is subject to market conditions, with no guarantee of completion or final terms. A shelf registration statement on Form S-3 was previously filed and declared effective by the SEC.

Positive

• Potential expansion of commercial infrastructure in the US market
• Strategic preparation for European Union market entry
• Investment in PreTRM test adoption studies and FDA approval process

Negative

• Potential shareholder dilution through new stock offering
• Uncertainty in offering completion and final terms
• Additional capital requirements indicating possible cash burn concerns

Insights

Financial Analyst

This public offering announcement represents a significant capital raising initiative that warrants careful analysis. The structure, combining Class A common stock with pre-funded warrants, suggests a sophisticated approach to maximize investor participation while providing flexibility in timing of capital deployment. The inclusion of a 15% overallotment option indicates confidence in potential demand.

The syndicate of underwriters is particularly noteworthy, with Jefferies, TD Cowen, William Blair and RBC Capital Markets as bookrunners - all prestigious institutions that bring substantial distribution capabilities and market credibility. Their involvement suggests a well-structured offering with strong institutional backing.

The planned use of proceeds reveals a comprehensive growth strategy focused on three key areas:

• Commercial infrastructure expansion in the US market
• European Union market preparation
• Additional studies for PreTRM test adoption and FDA approval pursuit

While this offering will likely result in dilution for existing shareholders, the capital injection could be transformative for Sera's market position. The focus on FDA approval for the PreTRM test particularly stands out as a potential value catalyst, as regulatory clearance could significantly expand market access and reimbursement opportunities.

The timing of this offering, following the effectiveness of their S-3 shelf registration in August 2024, suggests a strategic decision to access capital markets while maintaining flexibility in execution. However, investors should note that final terms remain subject to market conditions, introducing some uncertainty about the ultimate size and pricing of the offering.

SALT LAKE CITY, Feb. 10, 2025 /PRNewswire/ -- Sera Prognostics, Inc., The Pregnancy Company^® ("Sera" or the "Company") (Nasdaq: SERA), which focuses on improving maternal and neonatal health by providing innovative pregnancy biomarker information to doctors and patients, today announced that it has commenced a proposed underwritten public offering of its Class A common stock and, in lieu of Class A common stock to certain investors, pre-funded warrants to purchase shares of its Class A common stock.  In addition, Sera intends to grant the underwriters a 30-day option to purchase shares of Class A common stock in an amount up to an additional 15% of the total amount of shares of Class A common stock and shares of Class A common stock underlying pre-funded warrants sold in the public offering on the same terms and conditions. All of the shares and pre-funded warrants to be sold in the offering will be offered by Sera. The offering is subject to market and other conditions, and 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.

Jefferies, TD Cowen and William Blair are acting as joint book-running managers and RBC Capital Markets is acting as a bookrunner for the proposed offering.

Sera intends to use the net proceeds from the proposed offering to expand its commercial infrastructure and capabilities in the United States, accelerate preparations for expansion in the European Union, fund additional studies designed to increase adoption of the PreTRM test, including a potential submission to the U.S. Food and Drug Administration (the "FDA") seeking broad approval of the PreTRM test, and for general corporate purposes. 

A shelf registration statement on Form S-3 (File No. 333-281347) relating to the securities offered in the underwritten offering was filed with the Securities and Exchange Commission (the "SEC") on August 7, 2024 and declared effective on August 13, 2024. The offering will be made only by means of a prospectus supplement and accompanying prospectus that form a part of the registration statement. A preliminary 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 preliminary prospectus supplement and accompanying prospectus relating to this offering, when available, may be obtained from Jefferies LLC, Attention:  Equity Syndicate Prospectus Department, 520 Madison Avenue, New York, NY 10022, by telephone at 877-821-7388 or by email at prospectus_department@jefferies.com; 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; or William Blair & Company, L.L.C., The William Blair Building, 150 North Riverside Plaza, Chicago, Illinois 60606, or by telephone at (800) 621-0687 or email at prospectus@williamblair.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 other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification of these securities under the securities laws of any such state or other jurisdiction.

About Sera Prognostics, Inc.

Sera Prognostics is a leading health diagnostics company dedicated to improving the lives of women and babies through precision pregnancy care. Sera's mission is to provide early, pivotal pregnancy information to improve the health of mothers and newborns, resulting in reductions in the costs of healthcare delivery. Sera has a robust pipeline of innovative diagnostic tests focused on the early prediction of preterm birth risk and other complications of pregnancy. Sera's precision medicine PreTRM® Test reports to a physician the individualized risk of spontaneous premature delivery in a pregnancy, enabling earlier proactive interventions in women with higher risk. Sera Prognostics is headquartered in Salt Lake City, Utah.

Safe Harbor Statement

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the size, structure, timing and completion of the proposed public offering, the grant to the underwriters of an option to purchase additional shares of Class A common stock and our anticipated use of proceeds of the proposed public offering.  These "forward-looking statements" 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 forward-looking statements. These risks and uncertainties include, but are not limited to: the uncertainties related to market conditions and the completion of the proposed public offering on the anticipated terms, or at all, net losses, cash generation, and the potential need to raise more capital; revenues from the PreTRM Test representing substantially all Company revenues to date; the need for broad scientific and market acceptance of the PreTRM Test; a concentrated number of material customers; our ability to introduce new products; potential competition; our proprietary biobank; critical suppliers; estimates of total addressable market opportunity and forecasts of market growth; potential third-party payer coverage and reimbursement; new reimbursement methodologies applicable to the PreTRM Test, including new CPT codes and payment rates for those codes; changes in FDA regulation of laboratory-developed tests; the intellectual property rights protecting our tests and market position; and other factors discussed under the heading "Risk Factors" contained in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission, as well as any updates to those risk factors filed from time to time in our periodic and current reports filed with the Securities and Exchange Commission.  All information in this press release is as of the date of the release, and the Company undertakes no duty to update this information unless required by law.

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SOURCE Sera Prognostics, Inc.

FAQ

What is the purpose of Sera Prognostics' (SERA) February 2025 public offering?

The offering aims to fund US commercial infrastructure expansion, European Union market preparation, PreTRM test adoption studies, potential FDA approval submission, and general corporate purposes.

How much additional stock can underwriters purchase in SERA's 2025 offering?

Underwriters have a 30-day option to purchase up to an additional 15% of the total shares and pre-funded warrants sold in the offering.

Which investment banks are managing Sera Prognostics' 2025 public offering?

Jefferies, TD Cowen, and William Blair are joint book-running managers, with RBC Capital Markets acting as a bookrunner.

When was SERA's shelf registration statement for this offering declared effective?

The shelf registration statement on Form S-3 was declared effective by the SEC on August 13, 2024.

What regulatory approvals is Sera Prognostics seeking with the offering proceeds?

Part of the proceeds will fund studies for a potential FDA submission seeking broad approval of the PreTRM test.