REDWOOD CITY, Calif. – Adverum Biotechnologies, Inc. (NASDAQ:ADVM), a clinical-stage gene therapy company focusing on ocular diseases, has entered into an agreement for a private placement of stock, set to raise approximately $127.5M. The transaction involves the sale of around 106.25 million shares at $1.20 each, a 20% premium over the company's recent average stock price. The deal, expected to close on February 8, 2024, includes pre-funded warrants as an alternative for some investors.
The financing round was led by TCGX and saw participation from a mix of new and existing investors, such as 5AM Ventures, Commodore Capital, Frazier Life Sciences, Logos Capital, Samsara BioCapital, Venrock Healthcare Capital Partners, Vivo Capital, and two sizable investment management firms.
This influx of capital, combined with Adverum's existing assets, is projected to support the company's operations well into late 2025. TD Cowen and Truist Securities served as placement agents for the offering.
The securities sold in this private placement have not been registered under the Securities Act of 1933 and are therefore restricted in their sale within the United States, pending either an effective registration statement or an exemption from registration requirements. Adverum has committed to filing a registration statement with the U.S. Securities and Exchange Commission for the resale of these shares.
Adverum Biotechnologies is advancing gene therapy treatments for prevalent ocular diseases with the goal of establishing new standards of care. Its lead candidate, ixoberogene soroparvovec (Ixo-vec), is being developed as a one-time injection for neovascular age-related macular degeneration, with the potential to eliminate the need for frequent treatments.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities. This article is based on a press release statement from Adverum Biotechnologies.
InvestingPro Insights
Adverum Biotechnologies has recently secured a significant investment through a private stock placement, aiming to propel its gene therapy research and operations forward. Investors considering this clinical-stage company will find InvestingPro's real-time data and analytics particularly informative. Adverum holds a market capitalization of $143.46M, indicative of its size within the biotech industry. Despite a challenging financial performance with a gross profit margin at -2203% over the last twelve months as of Q3 2023, the company has managed to maintain a positive investment outlook with a substantial return of 102.86% over the last year. The price of Adverum's shares is currently at 60.68% of its 52-week high, with a previous close at $1.19.
InvestingPro Tips suggest that Adverum's balance sheet is robust, holding more cash than debt, which is a reassuring sign for investors. However, the company is quickly burning through cash, a common scenario in the biotech sector where research and development costs can be substantial. Moreover, the company does not pay dividends, which may be a consideration for income-focused investors. For those interested in further analysis, InvestingPro offers additional insights, including a total of 14 InvestingPro Tips, which can be accessed by subscribing to InvestingPro+. Take advantage of the special New Year sale, with discounts of up to 50%, and use coupon code SFY24 for an additional 10% off a 2-year subscription, or SFY241 for an additional 10% off a 1-year subscription.
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