Sutro Biopharma Announces Pricing of $75 Million Underwritten Offering
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Insights
The announcement by Sutro Biopharma regarding its underwritten offering of over 14 million shares at $5.18 each is a significant financial move, aiming to generate around $75 million in gross proceeds. This capital infusion is critical for the company's continued research and development in the oncology sector, particularly for advancing their antibody drug conjugates (ADCs). It's important to assess the offering price in relation to the current market price to gauge investor sentiment and potential dilution effects. Furthermore, the use of proceeds is a key factor; if invested wisely in their clinical programs, it could enhance the company's pipeline value and future revenue prospects.
From a medical research standpoint, Sutro Biopharma's focus on site-specific and novel-format ADCs is a noteworthy approach in targeted cancer therapy. ADCs represent a growing segment in oncology treatments, combining the specificity of antibodies with the potency of cytotoxic drugs. The capital raised could accelerate the development of their pipeline, potentially leading to breakthrough therapies. However, the clinical success of these compounds is not guaranteed and carries substantial risk. The long-term impact on the company's valuation will hinge on clinical trial outcomes and regulatory approvals.
Examining the broader market implications, Sutro Biopharma's stock offering must be contextualized within the biotech industry's funding landscape. Biotech firms often rely on public offerings to fund R&D due to the high costs and lengthy timelines associated with bringing new drugs to market. The pricing of the offering can reflect market confidence in Sutro's technology and future prospects. It's essential to monitor the post-offering stock performance for any signs of investor fatigue or enthusiasm, which can serve as a barometer for the sector's health and investor appetite for risk in biotech equities.
SOUTH SAN FRANCISCO, Calif., April 02, 2024 (GLOBE NEWSWIRE) -- Sutro Biopharma, Inc. (Sutro or the Company) (NASDAQ: STRO), a clinical-stage oncology company pioneering site-specific and novel-format antibody drug conjugates (ADCs), today announced the pricing of an underwritten offering of 14,478,764 shares of its common stock at a price of
The offering was led by a high quality group of new and existing healthcare focused institutional investors.
Sutro intends to use the net proceeds of this offering, together with its existing cash, cash equivalents and marketable securities, primarily for general corporate purposes, which may include funding research, clinical and process development and manufacturing of its product candidates, increasing its working capital, developing its commercialization infrastructure, expanding its manufacturing capabilities, acquisitions or investments in businesses, products or technologies that are complementary to its own, capital expenditures and other general corporate purposes.
BofA Securities is acting as sole book-running manager in the offering.
The shares are being offered by Sutro pursuant to a registration statement previously filed and declared effective by the Securities and Exchange Commission (SEC). A prospectus supplement and accompanying prospectus relating to and describing the terms of the offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. Copies of the prospectus supplement and accompanying prospectus may also be obtained, when available, from: BofA Securities, NC1-0220-02-25, Attention: Prospectus Department, 201 North Tryon Street, Charlotte, North Carolina, 28255-0001, or by email at dg.prospectus_requests@bofa.com.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities of Sutro, 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 Sutro Biopharma
Sutro Biopharma, Inc. is a clinical-stage company relentlessly focused on the discovery and development of precisely designed cancer therapeutics, to transform what science can do for patients. Sutro’s fit-for-purpose technology, including cell-free XpressCF®, provides the opportunity for broader patient benefit and an improved patient experience. Sutro has multiple clinical stage candidates, including luveltamab tazevibulin, or luvelta, a registrational-stage folate receptor alpha (FolRα)-targeting ADC in clinical studies. A robust pipeline, coupled with high-value collaborations and industry partnerships, validates Sutro’s continuous product innovation. Sutro is headquartered in South San Francisco.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements the Company makes regarding its expectation of market conditions and the satisfaction of customary closing conditions related to the offering and sale of securities, the Company's ability to complete the offering, anticipated gross proceeds from the offering and expected use of proceeds; anticipated preclinical and clinical development activities, including enrollment and site activation; timing of announcements of clinical results, trial initiation, and regulatory filings; outcome of regulatory decisions; potential benefits of luvelta and the Company’s other product candidates and platform; potential expansion into other indications and combinations, including the timing and development activities related to such expansion; potential market opportunities for luvelta and the Company’s other product candidates; and the Company’s expected cash runway. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, the Company cannot guarantee future events, results, actions, levels of activity, performance or achievements, and the timing and results of biotechnology development and potential regulatory approval is inherently uncertain. Forward-looking statements are subject to risks and uncertainties that may cause the Company’s actual activities or results to differ significantly from those expressed in any forward-looking statement, including risks and uncertainties related to the Company’s ability to advance its product candidates, the receipt and timing of potential regulatory designations, approvals and commercialization of product candidates and the Company’s ability to successfully leverage Fast Track designation, the market size for the Company’s product candidates to be smaller than anticipated, clinical trial sites, supply chain and manufacturing facilities, the Company’s ability to maintain and recognize the benefits of certain designations received by product candidates, the timing and results of preclinical and clinical trials, the Company’s ability to fund development activities and achieve development goals, the Company’s ability to protect intellectual property, the value of the Company’s holdings of Vaxcyte common stock, and the Company’s commercial collaborations with third parties and other risks and uncertainties described under the heading “Risk Factors” in documents the Company files from time to time with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this press release, and the Company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date hereof.
Contact
Emily White
Sutro Biopharma
(650) 823-7681
ewhite@sutrobio.com
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