MINNEAPOLIS - DiaMedica Therapeutics Inc. (NASDAQ:DMAC), a clinical-stage biopharmaceutical company, today announced the completion of an $11.8 million private placement. The transaction involved the sale of approximately 4.7 million common shares at $2.50 each, which is about 10% above the closing price on the preceding Tuesday.
The company, which is developing treatments for severe ischemic diseases, stated that the net proceeds from the offering are approximately $11.7 million. This funding is expected to bolster DiaMedica's financial position, with its cash, cash equivalents, and short-term investments projected to total $58.2 million pro forma as of March 31, 2024.
DiaMedica's shares were sold in a private placement and have not been registered under the U.S. Securities Act of 1933 or any state securities laws, and therefore cannot be offered or sold in the United States absent registration or an applicable exemption. The company has committed to filing a registration statement with the U.S. Securities and Exchange Commission for the resale of the shares issued in the placement.
In connection with this placement, two significant acquisitions were also disclosed. Thomas von Koch, through TomEnterprise Private AB, and Trill AB each acquired 1,200,000 common shares, representing an increase in their respective ownership stakes to approximately 12.9% and 12.2% of the company's outstanding common shares. Both acquisitions were made for investment purposes and may lead to further transactions depending on market conditions.
The Canadian dollar values mentioned were calculated using the Bank of Canada's daily exchange rate on June 25, 2024. Following the closure of the private placement, early warning reports will be filed with Canadian securities regulators and will be available on the company's profile at www.sedar.com.
This announcement 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, DiaMedica Therapeutics has shared updates on its progress and financial standing during its first quarter earnings call. The company is actively working on its ReMEDy2 trial, with 8 sites currently activated and plans to increase the target number of U.S. sites beyond the initial 40. Despite delays due to the COVID-19 pandemic, DiaMedica reported a strong cash position of $46.5 million in combined cash and investments as of March 31, 2024.
The company's financial results also showed that general and administrative expenses rose to $2.1 million in Q1 2024 due to team expansion. The interim enrollment for the ReMEDy2 trial is anticipated to complete by the end of Q1 2025, with data readout for the interim analysis expected in Q3 2025.
DiaMedica also plans to appeal a recent judgment in their lawsuit against PRA. Furthermore, the company has treated 1 million patients with Kailikang in China, indicating the safety of KLK1 therapy. These are the recent developments in DiaMedica Therapeutics' operations and financial status.
InvestingPro Insights
In light of DiaMedica Therapeutics Inc.'s recent private placement, investors are closely monitoring the company's financial health and stock performance.
According to InvestingPro data, DiaMedica (NASDAQ:DMAC) holds a market capitalization of $111.99 million, with a notably high one-week price total return of 32.88%. This surge in stock price could reflect market optimism about the potential of the company's ischemic disease treatments and its strengthened financial position post-funding.
An InvestingPro Tip highlights that DiaMedica is not expected to be profitable this year, which aligns with its negative earnings metrics, such as a last twelve months as of Q1 2024 P/E ratio of -5.81 and an operating income adjusted for the same period at -$21.49 million.
Despite this, the company's liquid assets exceed its short-term obligations, indicating a level of financial stability that could reassure investors of its capacity to sustain operations and continue its clinical developments.
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