Artelo Biosciences Announces $1.425 Million At-the-Market Private Placement Financing

Rhea-AI Summary

Artelo Biosciences (Nasdaq: ARTL) has secured a $1.425 million At-the-Market private placement financing through a definitive securities purchase agreement. The company will issue 136,844 shares of common stock and 93,179 pre-funded warrants, along with warrants to purchase additional shares at $5.82 and $10.00 per share.

The funding will support the announcement of clinical data from two phase 1 studies for ART26.12 and a phase 2 study readout from the CAReS trial for ART27.13. Notably, $250,000 of the net proceeds will be allocated to purchase SOL digital currency, with the remaining funds used for general corporate purposes.

Positive

• Secured $1.425 million in new funding to support clinical trial readouts
• Funding ensures completion of multiple clinical study announcements
• Strategic investment of $250,000 in SOL digital currency shows diversification

Negative

• Dilutive effect on shareholders through issuance of new shares and warrants
• Complex warrant structure may create future dilution at $5.82 and $10.00 per share
• Unregistered securities subject to resale restrictions

Insights

Biotech/Pharmaceutical Expert

Artelo secures $1.425M to fund clinical readouts, with unusual allocation of $250K to cryptocurrency amid conventional biotech financing structure.

Artelo Biosciences has secured a targeted $1.425 million private placement specifically designed to support upcoming clinical trial readouts. This funding creates a financial bridge to critical data announcements for multiple drug candidates: two Phase 1 study results for ART26.12 and a Phase 2 readout from the CAReS trial for ART27.13.

The financing structure includes 136,844 shares of common stock and 93,179 pre-funded warrants, complemented by warrants to purchase additional shares at $5.82 and $10.00 per share. This structure provides immediate capital while giving investors potential future upside through the warrant coverage.

What's particularly notable is the $250,000 allocation to purchase SOL cryptocurrency – representing approximately 17.5% of the proceeds. This is an unconventional approach for a clinical-stage pharmaceutical company, where capital is typically directed entirely toward research and development or operational expenses.

The financing appears calibrated to support Artelo through specific near-term clinical milestones rather than funding new research initiatives. For clinical-stage companies like Artelo, these data readouts represent potential inflection points that could significantly impact company valuation and strategic direction. The modest size of this raise suggests it's a bridge financing to reach these specific data announcements rather than a comprehensive funding solution.

Financial Analyst

$1.425M private placement provides runway to clinical milestones with unusual 17.5% crypto allocation, signaling targeted bridge financing strategy.

This $1.425 million private placement represents a precisely targeted capital infusion designed to carry Artelo through upcoming clinical data announcements. The financing combines immediate equity issuance with a tiered warrant structure that minimizes immediate dilution while providing potential upside for investors.

The warrant pricing structure reveals strategic considerations: warrants priced at $5.82 and $10.00 per share suggest confidence in potential appreciation following positive clinical data. The inclusion of pre-funded warrants alongside common stock issuance accommodates investors who might face ownership limitations while securing immediate capital.

The most unusual aspect is the allocation of $250,000 to purchase SOL cryptocurrency – approximately 17.5% of the gross proceeds. This represents an atypical treasury management decision for a clinical-stage biotech company without commercial revenue. While some companies have adopted digital assets as inflation hedges, this allocation introduces additional volatility risk that's uncommon for pre-revenue pharmaceutical companies.

The modest size of this financing indicates it's structured as a bridge to specific clinical readouts rather than a comprehensive funding solution. The emphasis on providing "sufficient capital" for clinical data announcements suggests a milestone-based approach to financing. Investors should recognize this as a targeted strategy to reach value-inflection points that could potentially enable more favorable terms in subsequent financing rounds if clinical data proves positive.

SOLANA BEACH, Calif., June 26, 2025 (GLOBE NEWSWIRE) -- Artelo Biosciences, Inc. (Nasdaq: ARTL), a clinical-stage pharmaceutical company focused on modulating lipid-signaling pathways to develop treatments for people living with cancer, pain, dermatological or neurological conditions, today announced it has entered into a definitive securities purchase agreement for an At-the-Market private placement for gross proceeds of approximately $1.425 million.

Under the terms of the agreement, Artelo will issue 136,844 shares of common stock and 93,179 pre-funded warrants, along with accompanying warrants to purchase 460,046 shares at $5.82 per share and 230,023 shares at $10.00 per share. The purpose of the offering was to provide sufficient capital for Artelo to announce clinical data regarding its two phase 1 study results for ART26.12 and a phase 2 study readout from the CAReS trial for ART27.13 as previously disclosed. In addition, the agreement provides that Artelo will use commercially reasonably efforts to use $250,000 of the net proceeds to purchase the digital currency known as SOL and the balance of the net proceeds will be used for general corporate and working capital purposes and to pay any fees and expenses in connection with the offering. The closing of the offering is expected to occur on or about June 26, 2025, subject to the satisfaction of customary closing conditions.

The securities sold in the private placement have not been registered under the Securities Act of 1933, as amended, and may not be resold in the United States absent registration or an applicable exemption from registration requirements. The Company has agreed to file a registration statement covering the resale of the securities issued in the offering. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Artelo Biosciences Artelo Biosciences, Inc. is a clinical-stage pharmaceutical company dedicated to the development and commercialization of proprietary therapeutics that modulate lipid-signaling pathways. Artelo is advancing a portfolio of broadly applicable product candidates designed to address significant unmet needs in multiple diseases and conditions, including anorexia, cancer, anxiety, dermatologic conditions, pain, and inflammation. Led by proven biopharmaceutical executives collaborating with highly respected researchers and technology experts, the Company applies leading-edge scientific, regulatory, and commercial discipline to develop high-impact therapies. More information is available at www.artelobio.com and X: @ArteloBio.

Forward Looking Statements
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and Private Securities Litigation Reform Act, as amended, including those relating to the Company’s future investment policy of its excess capital, product development, clinical and regulatory timelines, market opportunity, competitive position, possible or assumed future results of operations, business strategies, potential growth opportunities and other statement that are predictive in nature. These forward-looking statements are based on current expectations, estimates, forecasts and projections about the industry and markets in which we operate and management’s current beliefs and assumptions. These statements may be identified by the use of forward-looking expressions, including, but not limited to, “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “potential,” “predict,” “project,” “should,” “would” and similar expressions and the negatives of those terms. These statements relate to future events or our financial performance and involve known and unknown risks, uncertainties, and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include those set forth in the Company’s filings with the Securities and Exchange Commission, including our ability to raise additional capital in the future. Prospective investors are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date of this press release. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise, except to the extent required by applicable securities laws.

Investor Relations Contact:
Crescendo Communications, LLC
Tel: 212-671-1020
Email: ARTL@crescendo-ir.com

FAQ

What is the size and structure of Artelo Biosciences (ARTL) private placement financing?

Artelo secured a $1.425 million At-the-Market private placement, issuing 136,844 common shares, 93,179 pre-funded warrants, and additional warrants to purchase shares at $5.82 and $10.00.

How will ARTL use the proceeds from the private placement?

The proceeds will fund announcements of two Phase 1 study results for ART26.12, a Phase 2 study readout from CAReS trial, with $250,000 allocated to purchase SOL digital currency and the remainder for general corporate purposes.

When will Artelo Biosciences private placement close?

The private placement is expected to close on or about June 26, 2025, subject to customary closing conditions.

What are the trading restrictions on ARTL's private placement securities?

The securities have not been registered under the Securities Act of 1933 and cannot be resold without registration or an applicable exemption. Artelo will file a registration statement for resale.

How many warrants are included in ARTL's private placement?

The placement includes warrants to purchase 460,046 shares at $5.82 per share and 230,023 shares at $10.00 per share, along with 93,179 pre-funded warrants.