SAN JOSE, Calif. - Rani Therapeutics Holdings, Inc. (NASDAQ:RANI), a biotherapeutics company, has announced a securities purchase agreement with an institutional investor to sell shares and warrants in a registered direct offering. The transaction involves the sale of 2.8 million shares of Class A common stock and pre-funded warrants for an additional 446,753 shares, along with Series A and Series B common warrants to purchase up to 3,246,753 shares each.
The combined purchase price for each share and accompanying warrants is set at $3.08. The warrants will be exercisable six months after issuance, with Series A expiring 18 months post-issuance and Series B expiring five and a half years later. The exercise price for both Series A and Series B warrants is also $3.08 per share.
Maxim Group LLC is the sole placement agent for this offering, which is expected to close around July 23, 2024, subject to customary closing conditions. Rani Therapeutics anticipates gross proceeds of approximately $10 million, before deducting fees and other offering expenses. However, this figure does not include potential proceeds from the exercise of the pre-funded and common warrants.
The offering is pursuant to a "shelf" registration statement previously filed with and declared effective by the U.S. Securities and Exchange Commission on August 10, 2022. Details of the offering will be available in the final prospectus supplement and accompanying prospectus to be filed with the SEC.
Rani Therapeutics specializes in the oral delivery of biologics and drugs, aiming to replace injections and infusions with oral dosing through their proprietary RaniPill® capsule technology. The company has completed various preclinical and clinical studies to assess the safety and bioavailability of the RaniPill®.
This article is based on a press release statement and should not be considered an offer to sell or a solicitation of an offer to buy any securities.
In other recent news, Rani Therapeutics Holdings has reported its Q1 2024 financial results, disclosing a net loss of $0.56 per share. Research and development expenses for the quarter were $7.6 million, while selling, general, and administrative expenses amounted to $6.4 million. In response to this financial update, H.C. Wainwright revised its price target for Rani Therapeutics from $12.00 to $13.00, maintaining a Buy rating. Concurrently, Canaccord Genuity adjusted its financial outlook for the company, reducing its price target from $21.00 to $9.00 due to a shift in the clinical development timeline, specifically for Rani's osteoporosis treatment candidate, RT-102. Despite the revised timeline, the firm maintained a Buy rating, indicating continued confidence in Rani Therapeutics' potential.
In a significant development, Rani Therapeutics and South Korean biotech firm, ProGen Co., Ltd., have announced a partnership to co-develop and commercialize RT-114, an oral therapeutic for obesity. The collaboration will leverage Rani's RaniPill® capsule and ProGen's proprietary protein, PG-102. The companies have agreed on a 50/50 cost and revenue share arrangement for the global development and commercialization of the product. Preclinical and Phase 1 development activities are set to begin in 2025.
InvestingPro Insights
As Rani Therapeutics Holdings, Inc. (NASDAQ:RANI) navigates through a new securities purchase agreement, the company's financial health and market performance are of interest to current and potential investors. According to InvestingPro data, Rani Therapeutics currently has a market capitalization of $152.27 million. The company's Price / Book ratio, as of the last twelve months leading up to Q1 2024, stands at 20.92, indicating a high valuation compared to its book value. Moreover, the stock has experienced a significant 1-week price total return of -22.81%, reflecting recent market reactions.
InvestingPro Tips suggest that Rani Therapeutics is quickly burning through cash and has weak gross profit margins. Analysts are not expecting the company to be profitable this year, which aligns with the reported negative EBITDA of -$62.73 million for the same period. Furthermore, the stock has taken a substantial hit over the last week and has fared poorly over the last month, with a 1-month price total return of -25.78%. It's worth noting, however, that the company's liquid assets exceed its short-term obligations, providing some financial stability in the near term.
Investors interested in a deeper analysis can find additional InvestingPro Tips for Rani Therapeutics at https://www.investing.com/pro/RANI. For those looking to subscribe, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. There are 10 additional InvestingPro Tips available, which could offer further insights into the company's financial and market performance.
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