ROCHESTER, N.Y. - Vaccinex, Inc. (NASDAQ:VCNX), a clinical-stage biotechnology company, has entered into agreements resulting in the exercise of warrants for over 1 million shares, leading to approximately $6.2 million in gross proceeds, the company announced today. The transaction, which includes the issuance of new warrants, is expected to close today, subject to customary conditions.
The exercised warrants will result in the issuance of 827,483 shares of common stock and the pre-funding of 240,009 shares at a reduced price of $5.636 per share. In addition, warrant holders will receive new warrants to purchase up to 1,601,238 shares, also at $5.636 per share, which will be exercisable for five years.
Entities affiliated with Maurice Zauderer, President and CEO of Vaccinex, and Albert D. Friedberg, Chairman of the board, participated in the transaction, accounting for approximately 51% of the securities involved. Roth Capital Partners served as the financial advisor for this deal.
The company also plans to file a resale registration statement with the SEC for the shares of common stock issuable upon exercise of the new warrants. It is important to note that the warrants offered in the private placement have not been registered under the Securities Act or state securities laws.
Vaccinex focuses on treating neurodegenerative diseases and cancer by inhibiting SEMA4D. Its lead drug candidate, pepinemab, has shown promise in Phase 2 trials for Huntington's disease and is being evaluated in combination with other therapies for various cancers.
The company's financial position is aimed to be bolstered by the funds from this transaction, which will support its ongoing development plans.
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, Vaccinex, Inc. has made significant strides in the development of its investigational drug, pepinemab. The company's SIGNAL-AD clinical trial for Alzheimer's disease has shown encouraging results, with pepinemab demonstrating a statistically significant effect in slowing cognitive decline in patients with Mild Cognitive Impairment due to Alzheimer's disease. Furthermore, the drug was well-tolerated with no serious treatment-related adverse events reported across 16 clinical sites, meeting its primary safety endpoint.
In addition to the clinical trial's success, Vaccinex has exercised its right to call for the cancellation of several series of warrants issued from October 2023 through March 2024. This decision comes after the positive development in the company's clinical trial and as Vaccinex explores additional financing opportunities. However, the company cautions that there is no assurance that the holders will exercise their warrants, nor that any new financing strategies will be successful or on favorable terms.
These recent developments underscore the potential of pepinemab in the treatment of Alzheimer's disease. With an estimated 1 million U.S. population with Mild Cognitive Impairment due to Alzheimer's disease, the market potential for the drug is significant. Vaccinex is now considering partnerships for further development of pepinemab, which could potentially reduce the company's operating expenses. These are the latest developments for Vaccinex in its pursuit of Alzheimer's disease treatment.
InvestingPro Insights
Vaccinex, Inc. (NASDAQ:VCNX) is navigating a critical phase in its development with a recent infusion of capital through exercised warrants. The transaction is a strategic move to strengthen the company's financial footing as it advances its clinical programs. According to InvestingPro data, Vaccinex has a market capitalization of $10.37 million, which reflects the market's current valuation of the company's potential.
While the company's revenue for the last twelve months as of Q2 2024 stands at $0.36 million, it has experienced a notable decline in revenue growth of -56.85% during the same period. This underscores the challenges the company faces in scaling its operations and advancing its drug candidates. Furthermore, with a gross profit margin of -4101.97%, Vaccinex's financials indicate significant pressure on profitability, which is consistent with the nature of clinical-stage biotech companies that have yet to commercialize their products.
Despite these challenges, there are positive signs on the horizon. InvestingPro Tips indicate that analysts are expecting net income growth this year for Vaccinex and are anticipating sales growth in the current year. Moreover, the company's share price has seen a strong return over the last month, with a 24.74% price total return, suggesting a recent uptick in investor confidence. It is also noteworthy that Vaccinex operates with a moderate level of debt, which may offer some financial flexibility as it progresses through development milestones.
For investors considering Vaccinex as part of their portfolio, it's important to be aware of the inherent risks and volatility associated with biotech investments. InvestingPro offers a comprehensive list of additional tips, including insights into the company's cash burn rate, gross profit margins, and valuation multiples, which can be found at https://www.investing.com/pro/VCNX. These tips provide valuable context for the company's current financial health and future prospects.
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