SAN FRANCISCO - Nektar Therapeutics (NASDAQ:NKTR), a biopharmaceutical company specializing in the treatment of auto-immune disorders, has announced a private placement financing arrangement with TCGX, an institutional accredited investor. The agreement, which is set to yield $30 million in gross proceeds before expenses, involves the sale of 25 million shares of Nektar's common stock at $1.20 per share, a substantial premium over the recent average.
The shares are being sold in the form of pre-funded warrants, exercisable at $0.0001 per share, and are not subject to expiration. The transaction is expected to close by Wednesday, subject to standard closing conditions. Nektar has also committed to filing a registration statement for the underlying common stock within 90 days post-closing.
Howard Robin, President and CEO of Nektar, expressed satisfaction with the addition of TCGX as a long-term investor, highlighting the importance of the funding to the company's ongoing Phase 2b clinical trials of rezpegaldesleukin for atopic dermatitis and alopecia areata. Robin anticipates that the results from these studies, expected in the first half of 2025, will be pivotal for Nektar's future. The financing is projected to extend the company's cash runway into the third quarter of 2026.
Rezpegaldesleukin is an innovative biologic aimed at regulating the immune system by expanding T regulatory cells and activating various immunoregulatory pathways to mitigate inflammation.
Nektar Therapeutics, based in San Francisco, California, with additional operations in Huntsville, Alabama, focuses on the development of investigational medicines in immunology and oncology, alongside a portfolio of approved partnered medicines.
The information reported is based on a press release statement from Nektar Therapeutics.
InvestingPro Insights
As Nektar Therapeutics (NASDAQ:NKTR) secures a private placement deal to bolster its clinical trials, investors and market watchers are keeping a close eye on the company's financial health and stock performance. With a market capitalization of $148.8 million and a price-book ratio for the last twelve months as of Q3 2023 at 0.93, the company appears to be valued reasonably in terms of its net asset value.
InvestingPro Tips suggest that Nektar holds more cash than debt on its balance sheet, which could provide a cushion and financial flexibility as it continues its research and development activities. However, analysts are skeptical about the company's profitability in the near term, indicating that Nektar is not expected to be profitable this year. This aligns with the company's significant cash burn rate, which is an important consideration for potential investors.
In terms of stock performance, Nektar has experienced a significant return over the past week, with a price total return of 16.42%. Additionally, the stock has seen strong returns over the last month and three months, with total returns of 40.54% and 51.46%, respectively. These metrics may reflect investor optimism about the company's prospects or a response to recent strategic moves, such as the financing arrangement with TCGX.
While Nektar does not pay a dividend, which might deter income-focused investors, the company's liquid assets exceed its short-term obligations, indicating a solid liquidity position.
For those interested in a deeper analysis, there are additional InvestingPro Tips available, which can be accessed by visiting https://www.investing.com/pro/NKTR. Use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and discover the full range of insights that can help inform your investment decisions.
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