EGETIS THERAPEUTICS AB NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO
SEK 172 million private placement, led by US healthcare investor Frazier Life Sciences for a subscribed amount ofSEK 155 million , with demand for the new shares significantly exceeding the size of the private placementSEK 290 million debt financing obtained from BlackRock (formerly Kreos)
The net proceeds of the Private Placement and the Debt Financing will continue financing Emcitate’s development, applications for market authorisations for Emcitate in the EU and the US as well as the continued build-up of the Company’s commercial and medical affairs infrastructure including pre-launch activities, as well as general corporate purposes and financial flexibility.
Main characteristics of the Private Placement
The Board of Directors of Egetis has, based on the authorisation to issue shares granted by the annual general meeting on
The Board of Directors of the Company deems, after an overall assessment and careful consideration, that a new share issue with deviation from the shareholders' preferential rights is a better alternative for the Company’s shareholders than a rights issue. A rights issue would entail significantly longer execution time and thereby increased market exposure and a higher potential risk of materially affecting the share price negatively, particularly in this volatile and challenging market, compared to a directed share issue. Raising capital quickly provides flexibility for potential investment possibilities in the short term, which is particularly important for the Company given its ongoing operations and use of proceeds, contributes to reduced exposure to price fluctuations in the capital market as well as provides the opportunity to benefit from the current interest in the Company's share among potential institutional investors. The cost of carrying out a private placement is deemed to be lower than in a rights issue where, among other things, there would be a risk that a rights issue would not be fully subscribed and significant underwriting commitments from an underwriting syndicate would possibly have to be procured.
Moreover, unlike a rights issue, the Private Placement will broaden the shareholder base and provide the Company with a new reputable institutional owner and strategic investor in the Company, which the Board of Directors believes will be beneficial to the Company and it has also been important to be able to allow one of the Company’s major shareholders to participate in the share issue to show commitment and willingness to invest additional capital, while at the same time other major shareholders support the share issue while not partipating in the raise. Further, one of the conditions for the Debt Financing, and to be able to draw down the first debt tranche, has been to raise minimum
The Private Placement entails a dilution of approximately 14.7 percent of the number of shares and 14.7 percent of the number of votes in the Company (calculated as the number of newly issued shares divided by the total number of shares in the Company after the Private Placement). Through the Private Placement, the number of shares in the Company will increase by 42,982,331 from 249,589,128 to 292,571,459 and the number of votes from 249,589,128 to 292,571,459. The share capital will increase by approximately
In connection with the Private Placement, the Company has agreed to a lock-up undertaking, with customary exceptions, on future share issuances for a period of 90 calendar days after the settlement date of the Private Placement. In addition, the shareholding members of the Board of Directors and members of the senior management have undertaken not to, subject to customary exceptions, divest any shares held on the date hereof in the Company for a period of 90 days from the settlement date. Frazier and Cidro Förvaltning AB (
Main characteristics of the Debt Financing
The Debt Financing is divided into two tranches,
Advisers
About Frazier Life Sciences
Frazier Life Sciences invests globally in private and publicly-traded companies that discover, develop, and commercialize innovative biopharmaceuticals. Frazier Life Sciences’ funds comprise over
About BlackRock (formerly Kreos)
Formerly known as
BlackRock Venture & Growth Lending team consists of 27 investment professionals, supported by an experienced back office and resources from BlackRock’s global platform. The team manages over €2.5 billion of client capital, with an emphasis on building diversified portfolios, providing ‘operationally flexible’ expansion capital and meticulous approach to investment underwriting. BlackRock completed its acquisition of Kreos in
About
The Company’s lead drug candidate Emcitate is under development for the treatment of patients with monocarboxylate transporter 8 (MCT8) deficiency, a highly debilitating rare disease with no available treatment. In previous studies (Triac Trial I and a long-term real-life study) Emcitate has shown highly significant and clinically relevant results on serum thyroid hormone T3 levels and secondary clinical endpoints. Egetis submitted a marketing authorisation application (MAA) for Emcitate to the
After a dialogue with the FDA, Egetis is conducting a small randomized, placebo-controlled pivotal study (ReTRIACt) in 16 patients to verify the results on T3 levels seen in previous clinical trials and publications. Topline results are expected during the first half of 2024 and Egetis intends to submit a new drug application (NDA) in the US for Emcitate in mid 2024 under the Fast-Track Designation granted by FDA.
Emcitate holds Orphan Drug Designation (ODD) for MCT8 deficiency and resistance to thyroid hormone type beta (RTH-beta) in the US and the EU. MCT8 deficiency and RTH-beta are two distinct indications, with no overlap in patient populations. Emcitate has been granted Rare Pediatric Disease Designation (RPDD) which gives Egetis the opportunity to receive a Priority Review Voucher (PRV) in the US, after approval. This voucher can be transferred or sold to another sponsor.
The drug candidate Aladote is a first in class drug candidate developed to reduce the risk of acute liver injury associated with paracetamol (acetaminophen) overdose. A proof of principle study has been successfully completed and the design of the upcoming pivotal Phase Iib/III study with the purpose of applying for market approval in the US and
Important Information
The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to restrictions and the recipients of this press release in jurisdictions where this press release has been published or distributed shall inform themselves of and follow such restrictions. The recipient of this press release is responsible for using this press release, and the information contained herein, in accordance with applicable rules in each jurisdiction. This press release does not constitute an offer, or a solicitation of any offer, to buy or subscribe for any securities in Egetis in any jurisdiction, neither from Egetis nor from someone else.
This announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the new shares. Any investment decision in connection with the Private Placement must be made on the basis of all publicly available information relating to the Company and the Company’s shares. Such information has not been independently verified by the Sole Global Coordinator & Sole Bookrunner. The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. This announcement does not constitute a recommendation concerning any investor’s option with respect to the Private Placement. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The Sole Global Coordinator & Sole Bookrunner is acting for the Company in connection with the Private Placement and no one else and will not be responsible to anyone other than the Company for providing the protections afforded to its clients nor for giving advice in relation to the transaction or any other matter referred to herein.
This press release does not constitute or form part of an offer or solicitation to purchase or subscribe for securities in
This announcement is not a prospectus for the purposes of Regulation (EU) 2017/1129 (the ”Prospectus Regulation”) and has not been approved by any regulatory authority in any jurisdiction. Egetis has not authorized any offer to the public of shares or other securities in any member state of the EEA. In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Regulation.
In the
Forward-looking statements
This press release contains forward-looking statements that reflect the Company's intentions, beliefs, or current expectations about and targets for the Company's future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies and opportunities and the markets in which the Company operates. Forward-looking statements are statements that are not historical facts and may be identified by words such as "believe", "expect", "anticipate", "intend", "may", "plan", "estimate", "will", "should", "could", "aim" or "might", or, in each case, their negative, or similar expressions. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurances that they will materialize or prove to be correct. Because these statements are based on assumptions or estimates and are subject to risks and uncertainties, the actual results or outcome could differ materially from those set out in the forward-looking statements as a result of many factors. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The Company does not guarantee that the assumptions underlying the forward-looking statements in this press release are free from errors and readers of this press release should not place undue reliance on the forward-looking statements in this press release. The information, opinions and forward-looking statements that are expressly or implicitly contained herein speak only as of its date and are subject to change without notice. Neither the Company nor anyone else undertake to review, update, confirm or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this press release, unless it is not required by law or Nasdaq Stockholm rule book for issuers.
Information to distributors
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the shares in Egetis have been subject to a product approval process, which has determined that such shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "EU Target Market Assessment"). Solely for the purposes of each manufacturer's product approval process in the
For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II or
Each distributor is responsible for undertaking its own target market assessment in respect of the shares in Egetis and determining appropriate distribution channels.
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