WASHINGTON - 60 Degrees Pharmaceuticals, Inc. (NASDAQ: SXTP; SXTPW), a biopharmaceutical company specializing in the development of treatments for infectious diseases, disclosed the sale of shares and warrants in a private placement transaction expected to close on September 5, 2024. The company is issuing 2,898,551 shares of common stock, alongside series A and short-term series B warrants to purchase an equivalent number of shares, at a price of $1.38 each.
The series A warrants, exercisable upon stockholder approval, will be valid for five years, while the series B warrants will expire eighteen months post-approval. The exercise price for both series of warrants is set at $1.38 per share. H.C. Wainwright & Co. is the exclusive placement agent for this transaction.
60 Degrees Pharmaceuticals anticipates gross proceeds of approximately $4 million, before fees and other expenses. The net proceeds are intended for working capital, general operations, and furthering the commercialization of their FDA-approved malaria prevention drug, Arakoda, as well as ongoing research and development.
The securities offered in this private placement have not been registered under the Securities Act of 1933 or state securities laws, and thus cannot be sold in the U.S. without registration or an exemption. The company has committed to filing a resale registration statement for the securities involved.
Founded in 2010, 60 Degrees Pharmaceuticals has made strides in the infectious disease sector and collaborates with research institutions in the U.S., Australia, and Singapore. The company's efforts have been supported by in-kind funding from the U.S. Department of Defense and investments from private entities like Knight Therapeutics Inc.
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. The forward-looking statements in the press release are subject to risks and uncertainties that could cause actual results to differ materially from those projected.
In other recent news, 60 Degrees Pharmaceuticals reported a doubling of its Q2 revenue, largely attributed to a 288% rise in pharmacy deliveries of their malaria prevention drug, ARAKODA®. Despite increased revenues, the company saw a net loss attributable to common shareholders, owing to a substantial increase in operating expenses. On the development front, 60 Degrees Pharmaceuticals has initiated a clinical trial for the treatment of babesiosis and has received FDA Orphan Drug Designation for the same.
The company also announced a 1-for-12 reverse stock split to comply with Nasdaq's minimum bid price requirement. Ascendiant Capital continues to maintain its Buy rating on 60 Degrees Pharmaceuticals. In collaboration with the University of Kentucky and Eisai Co (OTC:ESAIY). Ltd., the company is set to begin a Phase IIb clinical trial for a novel treatment for vivax malaria.
60 Degrees Pharmaceuticals secured a contract with the United States Army Medical Materiel Development Activity for the commercial validation of new packaging for ARAKODA. The company has also initiated a clinical trial to evaluate the efficacy and safety of tafenoquine in treating babesiosis, an emerging tick-borne disease. These are among the recent developments in the company's ongoing efforts in the field of infectious diseases.
InvestingPro Insights
As 60 Degrees Pharmaceuticals, Inc. (NASDAQ: SXTP; SXTPW) navigates its private placement transaction, it's crucial to assess the company's financial health and market performance. InvestingPro data provides a snapshot of key metrics that are essential for investors to consider. With a significant quarterly revenue growth of 100.64% in Q2 2023, the company shows a promising increase in sales. However, it's important to note that the company's gross profit margin stands at a concerning -844.77% for the same period, indicating challenges in maintaining profitability against its revenue.
Market performance has also been turbulent for SXTP, with the stock experiencing a substantial 1-week price total return of -10.39% and a 1-month price total return of -15.38%. Over the last six months, the price total return has plummeted by -60.34%, reflecting investor sentiment and market conditions. These figures suggest that while the company is growing its top line, profitability and investor confidence remain areas of concern.
InvestingPro Tips highlight that SXTP holds more cash than debt, which is a positive sign of financial stability. Additionally, analysts anticipate sales growth in the current year, which aligns with the company's revenue growth figures. However, it's worth noting that SXTP is quickly burning through cash, which may impact its long-term operations if not managed effectively. For a more comprehensive analysis, including additional tips that could influence investment decisions, investors can explore the full range of insights available on InvestingPro.
Overall, while 60 Degrees Pharmaceuticals shows potential in its sales growth, the InvestingPro Tips and data suggest that the company faces challenges in profitability and market performance. Interested investors can find a total of 16 InvestingPro Tips for SXTP, offering a deeper dive into the company's financial prospects and stock performance.
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