Tenaya Therapeutics Announces Pricing of Public Offering

Rhea-AI Summary

Tenaya Therapeutics (Nasdaq: TNYA) has announced the pricing of a public offering of 75,000,000 units at $0.70 per unit, aiming to raise gross proceeds of approximately $52.5 million before deducting underwriting costs and expenses.

Each unit consists of one common stock share, a Series A Warrant (exercise price $0.80, 5-year expiration), and a Series B Warrant (exercise price $0.70, expires June 30, 2026) to purchase half a share. The offering is expected to close around March 5, 2025.

The clinical-stage biotech company plans to use the net proceeds to fund ongoing and planned development of clinical and early-stage product candidates, particularly TN-201 and TN-401, along with working capital and general corporate purposes. Leerink Partners and Piper Sandler are serving as joint book-running managers for the offering.

Positive

• Secured $52.5M in gross proceeds through public offering
• Funding secured for development of key clinical candidates TN-201 and TN-401

Negative

• Significant dilution with 75M new units being issued
• Low unit pricing at $0.70 indicates weak market position
• Additional dilution potential from warrant exercises

Insights

Financial Analyst

Tenaya's $52.5 million public offering represents a significant capital raise for a company with a $78.6 million market cap, but comes with substantial dilution. The offering price of $0.70 per unit reflects a 26% discount to the current share price ($0.9469), signaling weak demand and/or urgent capital needs. The structure includes 100% warrant coverage at $0.80 and additional 50% warrant coverage at $0.70, creating potential for further dilution.

The 75 million new shares will approximately double the company's outstanding share count, significantly diluting existing shareholders. While negative for current investors, this capital infusion provides Tenaya runway to advance its heart disease therapies TN-201 and TN-401. The warrant structure, particularly the short-term Series B warrants (expiring June 2026), suggests a possible bridge financing strategy until clinical milestones can potentially trigger a more favorable capital raise.

For biotechs without revenue, dilutive financing is often necessary, but the substantial discount and complex warrant structure suggest challenging market conditions. The size of this raise relative to Tenaya's market cap indicates both significant capital requirements for their clinical programs and possible difficulties securing more favorable terms. Investors should evaluate whether the additional runway justifies the substantial dilution.

Biotech Specialist

This capital raise is critical for Tenaya's clinical program advancement, particularly for lead candidates TN-201 and TN-401. As a clinical-stage biotech developing therapies for underlying heart disease causes, Tenaya requires substantial capital to progress through expensive clinical trials. The $52.5 million provides essential runway, though the financing terms suggest market skepticism about near-term clinical catalysts.

Heart disease therapeutics represent an enormous market opportunity but face challenging development pathways with high clinical failure rates. Tenaya's focus on "potentially curative therapies" indicates a gene therapy or precision medicine approach targeting specific genetic cardiac conditions, which typically requires substantial investment before reaching revenue generation.

The company's ability to secure joint book-running managers Leerink Partners and Piper Sandler (respected healthcare investment banks) provides some validation despite the dilutive terms. For a company at Tenaya's stage, securing adequate funding to reach meaningful clinical milestones is essential, even at the cost of significant dilution. The key questions for Tenaya now center on clinical execution and whether the proceeds provide sufficient runway to reach value-inflecting data points that could support future financings on better terms.

SOUTH SAN FRANCISCO, Calif., March 03, 2025 (GLOBE NEWSWIRE) -- Tenaya Therapeutics, Inc. (Nasdaq: TNYA), a clinical-stage biotechnology company with a mission to discover, develop and deliver potentially curative therapies that address the underlying causes of heart disease, today announced the pricing of its underwritten public offering of 75,000,000 total units for gross proceeds of approximately $52.5 million prior to deducting underwriting discounts and commissions and offering expenses. 

Tenaya intends to use the net proceeds from the offering to fund the ongoing and planned development of its clinical and early-stage product candidates, particularly TN-201 and TN-401, and for working capital and other general corporate purposes.

The offering is comprised of 75,000,000 units, priced at a public offering price of $0.70 per unit, with each unit consisting of one share of common stock, a warrant to purchase one share of common stock (which equates to 100% warrant coverage) at an exercise price of $0.80 per share, which will be immediately exercisable and will expire five years from the date of issuance (a Series A Warrant) and a warrant to purchase one-half of a share of common stock (which equates to 50% warrant coverage) at an exercise price of $0.70 per share, which will be immediately exercisable and expire on June 30, 2026 (a Series B Warrant). The securities comprising the units are immediately separable and will be issued separately.

All of the securities are to be sold by Tenaya. The offering is expected to close on or about March 5, 2025, subject to satisfaction of customary closing conditions.

Leerink Partners and Piper Sandler are acting as joint book-running managers for the offering.

The securities are being offered by Tenaya pursuant to a Registration Statement on Form S-3, which was previously filed and declared effective by the SEC, and Tenaya has filed a preliminary prospectus supplement and accompanying prospectus relating to and describing the terms of the offering with the SEC. A final prospectus supplement and accompanying prospectus relating to the offering will also be filed with the SEC. These documents can be accessed for free through the SEC’s website at www.sec.gov.

When available, copies of the final prospectus supplement and the accompanying prospectus relating to this offering may also be obtained from: Leerink Partners LLC, Attention: Syndicate Department, 53 State Street, 40th Floor, Boston, MA 02109, by telephone at 1 (800) 808-7525, ext. 6105, or by email at syndicate@leerink.com; or Piper Sandler & Co., 800 Nicollet Mall, J12S03, Minneapolis, MN 55402, Attention: Prospectus Department, by telephone at (800) 747-3924, or by email at prospectus@psc.com.

This press release does not constitute an offer to sell or a solicitation of an offer to buy, nor will there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation, or sale would be unlawful before registration or qualification under the securities laws of that state or jurisdiction.

About Tenaya Therapeutics
Tenaya Therapeutics is a clinical-stage biotechnology company committed to a bold mission: to discover, develop and deliver potentially curative therapies that address the underlying drivers of heart disease. Tenaya employs a suite of integrated internal capabilities, including modality agnostic target validation, capsid engineering and manufacturing, to generate a portfolio of genetic medicines aimed at the treatment of both rare genetic disorders and more prevalent heart conditions. Tenaya’s pipeline includes TN-201, a gene therapy for MYBPC3-associated hypertrophic cardiomyopathy (HCM), TN-401, a gene therapy for PKP2-associated arrhythmogenic right ventricular cardiomyopathy (ARVC), TN-301, a small molecule HDAC6 inhibitor intended for heart failure with preserved ejection fraction (HFpEF), and multiple early-stage programs in preclinical development.

Forward-Looking Statements
This press release contains forward-looking statements as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include, but are not limited to, statements relating to the offering, including the size and terms of the offering, the securities being offered, the timing of the closing of the offering, the expected gross proceeds and the use of proceeds. These forward-looking statements are neither promises nor guarantees and are subject to a variety of risks and uncertainties, including but not limited to: whether or not Tenaya will be able to raise capital through the sale of securities or consummate the offering; the final terms of the offering on the anticipated terms or at all, including the satisfaction of customary closing conditions; the anticipated use of the proceeds of the offering which could change as a result of market conditions or for other reasons; general economic and market conditions as well as geopolitical developments; and other risks. For further information regarding the foregoing and additional risks that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Tenaya in general, see Tenaya’s recent Quarterly Report on Form 10-Q filed on November 6, 2024, the prospectus supplement related to the proposed public offering we plan to file and subsequent filings with the Securities and Exchange Commission. These forward-looking statements are made as of the date of this press release, and Tenaya assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

FAQ

How much is Tenaya Therapeutics (TNYA) raising in their March 2025 public offering?

Tenaya is raising approximately $52.5 million through an offering of 75 million units priced at $0.70 per unit.

What are the terms of TNYA's warrant coverage in the March 2025 offering?

The offering includes 100% warrant coverage with Series A Warrants ($0.80 exercise price, 5-year term) and 50% coverage with Series B Warrants ($0.70 exercise price, expires June 30, 2026).

How will Tenaya Therapeutics use the proceeds from their 2025 public offering?

The proceeds will fund development of clinical candidates TN-201 and TN-401, plus working capital and general corporate purposes.

When is TNYA's March 2025 public offering expected to close?

The offering is expected to close on or about March 5, 2025, subject to customary closing conditions.