SAN DIEGO - Biora Therapeutics, Inc. (NASDAQ:BIOR), a clinical-stage biotech firm, disclosed the sale of 745,342 shares of common stock at $4.025 each in a registered direct offering, in line with Nasdaq regulations. Concurrently, the company will issue warrants in a private placement, enabling the purchase of an equal number of shares at $3.90 per share, exercisable immediately and expiring in five years.
The transaction, expected to close today, is contingent upon standard closing conditions. The gross proceeds are estimated at approximately $3 million before fees and expenses. H.C. Wainwright & Co. is the sole placement agent for this offering.
The capital raised is earmarked for operational support, further development of Biora's oral biotherapeutics platforms, and general corporate purposes. The public offering is pursuant to a shelf registration statement effective since May 31, 2024.
Additionally, Biora has agreed to amend existing warrants for 531,162 shares, reducing the exercise price to $3.90 per share, effective upon closing. The amended warrants will also expire in five years.
These securities, including the warrants and the shares of common stock underlying the warrants, have not been registered under the Securities Act of 1933 and are offered under an exemption.
Biora Therapeutics is advancing two smart pill-based therapeutics platforms: NaviCap™ for targeted treatment of IBD and BioJet™ for oral delivery of large molecules, aiming to replace injections with needle-free administration.
The announcement contains forward-looking statements that carry risks and uncertainties, including the successful completion of the offering and the anticipated use of proceeds. The company's ability to innovate, obtain regulatory approvals, and maintain its Nasdaq listing, among other factors, could impact actual results and the realization of forward-looking statements.
This news is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy any securities.
In other recent news, Biora Therapeutics has made significant strides in its BioJet Oral Delivery Platform, aiming to replace traditional injections with a needle-free, oral method. The company has also demonstrated the successful use of its BioJet device in canine models, with further development in advanced animal models underway. Biora Therapeutics anticipates completing full functional testing of the BioJet device by the end of Q4 2024.
The company has also reported positive second-quarter 2024 earnings, surpassing negative estimates and resulting in earnings per share (EPS) of $0.18. Investment firm H.C. Wainwright has reiterated a Buy rating for Biora Therapeutics, indicating a positive outlook for the company's business development and collaborations in the coming year.
In terms of financial restructuring, Biora Therapeutics has implemented a 10-for-1 reverse stock split and reduced the total number of authorized shares. The company has also secured additional funding, bringing the total recent funding to $8 million. Furthermore, Biora Therapeutics has entered into several transactions, including a Convertible Notes Purchase Agreement and a Convertible Notes Exchange Agreement, aimed at restructuring its debt and providing capital for ongoing operations.
These are among the recent developments for Biora Therapeutics, which continues to advance its innovative drug delivery technologies and prepare for potential growth and partnerships.
InvestingPro Insights
Biora Therapeutics' recent capital raise through a registered direct offering comes at a critical time for the company, as revealed by InvestingPro data. With a market capitalization of just $16.26 million, Biora is operating in a challenging financial environment. The company's revenue for the last twelve months as of Q2 2024 stood at a modest $0.86 million, highlighting the early-stage nature of its operations.
InvestingPro Tips paint a picture of a company facing significant hurdles. Biora is "quickly burning through cash" and "operates with a significant debt burden," which underscores the importance of this $3 million capital raise. The fact that "short-term obligations exceed liquid assets" further emphasizes the company's need for additional funding to support its innovative drug delivery platforms.
Despite these challenges, there are some positive indicators. Analysts anticipate sales growth in the current year, which aligns with Biora's focus on advancing its NaviCap™ and BioJet™ platforms. However, it's worth noting that analysts do not expect the company to be profitable this year, which is not uncommon for clinical-stage biotech firms investing heavily in research and development.
The stock's performance has been concerning, with InvestingPro data showing that the "price has fallen significantly over the last year" and "over the last five years." This context helps explain why the company is issuing shares at $4.025 and warrants at $3.90, which are considerably below the fair value of $97.5 based on analyst targets.
For investors considering Biora Therapeutics, it's crucial to understand that the company does not pay a dividend and is trading at a high revenue valuation multiple. These factors, combined with the company's financial position, suggest that an investment in BIOR would be speculative and high-risk at this stage.
InvestingPro offers 12 additional tips for BIOR, providing a more comprehensive analysis for those interested in delving deeper into the company's prospects and challenges.
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