Shares of Catalyst Biosciences Inc (NASDAQ:CBIO) tumbled nearly 21% this morning after investors learned that the hematology company has priced an underwritten public offering of units for gross proceeds of $18 million, prior to deducting underwriting discounts and commissions and offering expenses payable by Catalyst.
The offering is comprised of Class A Units, priced at a public offering price of $5.00 per unit, with each unit consisting of one share of common stock and a five-year warrant (each, a “warrant”) to purchase one-half share of common stock with an exercise price of $5.50 per share, and Class B Units, priced at a public offering price of $1,000 per unit, with each unit comprised of one share of preferred stock, which is convertible into 200 shares of common stock, and a warrant to purchase 100 shares of common stock, also with an exercise price of $5.50 per share.
A total of 930,000 shares of common stock, 13,350 shares of preferred stock convertible into 2,670,000 shares of common stock, and total warrants to purchase 1,800,000 shares of common stock will be issued in the offering.
In addition, Catalyst has granted the underwriters a 45-day option to purchase up to 540,000 additional shares of common stock and/or additional warrants to purchase up to 270,000 shares of common stock solely to cover over-allotments, if any, at the public offering price per share and per warrant, less the underwriting discounts and commissions.
On the ratings front, H.C. Wainwright analyst Ram Selvaraju reiterated a Buy rating on CBIO, in a report issued on December 12. According to TipRanks.com, Selvaraju has a yearly average loss of 4.5%, a 34% success rate, and is ranked #4396 out of 4556 analysts.
Selvaraju noted, “We remind investors that, based on recent approval history, only one positive pivotal trial would be needed to support a Biologics License Application (BLA) submission for the orphan indication of hemophilia. We continue to value the company’s hemostasis programs at $50M. However, our projected shares outstanding in 12 months have increased to 27M from 14M.”
Catalyst Biosciences, Inc. is a clinical-stage biopharmaceutical company. It focuses on creating and developing novel medicines to address serious medical conditions for patients who need new or better treatment options.