2023-05-01 10:22:52 ET
Eledon Pharmaceuticals ( NASDAQ: ELDN ) stock rose ~10% on Monday after the company said certain healthcare investors will provide up to $185M in gross proceeds via a private placement.
The purchase consists of an initial upfront financing of $35M in exchange for 15.2M common shares (or pre-funded warrants), at $2.31 per common stock and associated warrant sold at the initial closing, and up to an additional $105M in mandatory tranche financing, subject to reaching milestones.
In addition, Eledon will have the potential to receive $45M upon the full exercise of warrants being issued in connection with the agreement.
The private placement also includes a 5-year term warrant with an exercise price of $3.
The financing is being led by BVF Partners and Armistice Capital, and includes new and existing investors including Sanofi ( NASDAQ: SNY ) (via Sanofi Ventures).
Eledon plans to use the net proceeds to fund the development of its lead asset tegoprubart, for working capital and general corporate purposes.
"Eledon is now financially positioned to complete and report data from our planned Phase 2 BESTOW study, as well as to continue accumulating and reporting data from our ongoing Phase 1b kidney transplantation trial," said CEO David-Alexandre Gros.
The mid-stage study is evaluating tegoprubart for preventing rejection in patients receiving a kidney transplant.
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Eledon stock rises ~10% after up to $185M financing