AUSTIN, Texas - Plus Therapeutics, Inc. (NASDAQ:PSTV), a clinical-stage pharmaceutical company, announced today it has entered into a securities purchase agreement expected to generate $18 million in gross proceeds. The agreement involves new institutional investors and company insiders, with an initial funding of about $6.5 million and the possibility of an additional $11.5 million upon the exercise of accompanying warrants.
The deal includes AIGH Capital Management LLC and new healthcare-focused institutional investors, along with company insiders. With the potential full exercise of the warrants, the company's cash runway could reach approximately $34 million, supporting its corporate objectives, according to President and CEO Marc Hedrick, M.D.
Under the terms of the agreement, Plus Therapeutics will issue up to 3,238,627 shares of its common stock (or pre-funded warrants in lieu thereof) and accompanying warrants to purchase up to 6,477,254 shares at a combined purchase price of $2.022 per share and accompanying warrant. This complies with Nasdaq's "Minimum Price" requirement.
There are two series of warrants: Series A, exercisable until the fifth anniversary of the financing's closing, and Series B, exercisable until one year after a registration statement becomes effective. Both series have an exercise price of $1.772 per share, with potential proceeds of approximately $5.7 million each.
For investors choosing pre-funded warrants, the combined purchase price is $2.021 per pre-funded warrant and accompanying warrants, minus the $0.001 per share exercise price of each pre-funded warrant. The private placement is expected to close on May 8, 2024, subject to customary conditions.
This information is based on a press release statement from Plus Therapeutics Inc.
InvestingPro Insights
As Plus Therapeutics, Inc. (NASDAQ:PSTV) navigates a significant financial milestone with its recent securities purchase agreement, investors and stakeholders are keenly observing the company's metrics. The latest data from InvestingPro shows a market capitalization of $7.7 million, which is a critical figure reflecting the company's valuation in the market. Despite a challenging financial landscape, Plus Therapeutics has reported a staggering revenue growth of 2093.3% in the last twelve months as of Q4 2023. This growth, although impressive, should be viewed in the context of the company's gross profit margin, which is currently at -97.23%, indicating that the increased revenue has not translated into net profitability.
Moreover, the company's price has been volatile, with a 1 Year Price Total Return of -54.88%, underlining the risks involved in investing in the stock. However, the recent uptick of 8.43% in the 1 Week Price Total Return may provide a glimmer of hope for investors looking for short-term gains. The InvestingPro platform further offers a Fair Value estimate of $2.17, suggesting potential room for growth from its previous close price of $1.8.
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