BioXcel Therapeutics Announces $25 Million Registered Direct Offering

Rhea-AI Summary

BioXcel Therapeutics, Inc. announces a registered direct offering of common stock and warrants, raising approximately $25 million. The offering includes 3,054,609 shares of common stock and accompanying warrants, as well as pre-funded warrants to purchase additional shares.

Financial Analyst

The registered direct offering by BioXcel Therapeutics is indicative of its strategic move to raise capital for advancing its projects in neuroscience and immuno-oncology. The pricing of the shares and warrants at $2.901 and the pre-funded warrants at $2.900, slightly below the market value, is a common practice aimed at incentivizing immediate investment. The absence of underwriting discounts or placement agent fees suggests a cost-saving approach, potentially signaling confidence in the offering's success and the company's appeal to investors.

The exercise price of the accompanying warrants at $3.20 represents a modest premium over the offering price, which is typical in such transactions. The potential for additional capital through the exercise of these warrants could provide a future cash influx, but it also implies dilution for existing shareholders. Investors will weigh the near-term capital raise against the potential long-term dilution effects. The aggregate gross proceeds of approximately $25 million might be considered moderate for a biopharmaceutical firm, indicating that this offering is likely a part of a larger funding strategy.

Market Research Analyst

The biopharmaceutical sector is highly competitive and capital-intensive, with a significant emphasis on research and development. BioXcel Therapeutics' use of artificial intelligence in drug development could be a differentiator, potentially reducing time and costs associated with traditional R&D. This offering provides them with the necessary funds to further this competitive edge.

However, it's important to consider the broader market context. Biotech stocks are often volatile and market sentiment can shift rapidly based on clinical trial outcomes and regulatory news. Investors will be examining the company's pipeline and the progress of its key drug candidates to assess the potential return on investment. The lack of underwriters might raise questions about market perception, although it could also be seen as a move to retain greater control over the offering process.

Legal Expert

From a legal standpoint, the offering's compliance with SEC regulations, as evidenced by the use of a shelf registration statement declared effective in November 2023, is important for ensuring transparency and investor protection. The filing of a prospectus supplement will provide additional details about the offering, which is necessary for investors to make informed decisions.

The clear statement that the offering is not an attempt to solicit sales in jurisdictions where it would be unlawful is a standard disclaimer to prevent legal complications. It is also important to note the 'certain ownership limitations' which could be in place to prevent any single investor from gaining undue influence or control over the company, a practice that aligns with corporate governance standards.

NEW HAVEN, Conn., March 25, 2024 (GLOBE NEWSWIRE) -- BioXcel Therapeutics, Inc. (the “Company”) (Nasdaq: BTAI), a biopharmaceutical company utilizing artificial intelligence approaches to develop transformative medicines in neuroscience and immuno-oncology, today announced that it has entered into a securities purchase agreement with investors in a registered direct offering of 3,054,609 shares (the “Shares”) of common stock, par value $0.001 per share (“Common Stock”), and accompanying warrants (the “Accompanying Warrants”) to purchase up to 3,054,609 shares of Common Stock at a combined offering price of $2.901 per Share and Accompanying Warrant and pre-funded warrants (the “Pre-Funded Warrants”) to purchase up to 5,565,027 shares of Common Stock and Accompanying Warrants to purchase up to 5,565,027 shares of Common Stock at a combined offering price of $2.900 per share underlying each Pre-Funded Warrant and Accompanying Warrant, which equals the offering price per Share and Accompanying Warrant less the $0.001 exercise price per share of the Pre-Funded Warrants, for aggregate gross proceeds to the Company of approximately $25 million (excluding the proceeds, if any, from the exercise of the Pre-Funded Warrants and the Accompanying Warrants). The Pre-Funded Warrants have an exercise price of $0.001 per share of Common Stock and are exercisable at any time after the date of issuance, subject to certain ownership limitations. The Accompanying Warrants have an exercise price of $3.20 per share of Common Stock, are exercisable at any time after the date of issuance, subject to certain ownership limitations, and expire five years from the date of issuance.

The offering is expected to close on March 27, 2024, subject to customary closing conditions. Since the offering was made without an underwriter or a placement agent, the Company will not be paying any underwriting discounts or placement agent fees in connection with the offering.

The Shares, Pre-Funded Warrants and Accompanying Warrants were offered pursuant to a shelf registration statement on Form S-3 (File No. 333-275261) that was previously filed with the U.S. Securities and Exchange Commission (the “SEC”) and declared effective by the SEC on November 13, 2023. A prospectus supplement, which contains additional information relating to the offering, will be filed with the SEC and will be available on the SEC’s website at www.sec.gov.

This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of such jurisdiction.

Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this press release other than statements of historical fact should be considered forward-looking statements, including, without limitation, those regarding the completion of the closing of the offering. When used herein, words including “anticipate,” “believe,” “can,” “continue,” “could,” “designed,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, though not all forward-looking statements use these words or expressions. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking. All forward-looking statements are based upon the Company’s current expectations and various assumptions. The Company believes there is a reasonable basis for its expectations and beliefs, but they are inherently uncertain. The Company may not realize its expectations, and its beliefs may not prove correct. Actual results could differ materially from those described or implied by such forward-looking statements as a result of various important factors, including, without limitation, the important factors discussed under the caption “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as such factors may be updated from time to time in its other filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While the Company may elect to update such forward-looking statements at some point in the future, except as required by law, it disclaims any obligation to do so, even if subsequent events cause its views to change. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.

Contact Information

Corporate

BioXcel Therapeutics
Erik Kopp
1.203.494.7062
ekopp@bioxceltherapeutics.com

Investor Relations

BioXcel Therapeutics
Brennan Doyle
1.475.355.8462
bdoyle@bioxceltherapeutics.com

Media

Russo Partners
David Schull
T: 858-717-2310
David.Schull@russopartnersllc.com

Scott Stachowiak
T: 646-942-5630
Scott.Stachowiak@russopartnersllc.com

Source: BioXcel Therapeutics, Inc.

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What type of offering did BioXcel Therapeutics, Inc. announce?

BioXcel Therapeutics, Inc. announced a registered direct offering of common stock and warrants.

How many shares were included in the offering?

The offering included 3,054,609 shares of common stock.

What was the combined offering price per share and accompanying warrant?

The combined offering price was $2.901 per share and accompanying warrant.

What was the aggregate gross proceeds to the Company from the offering?

The Company raised approximately $25 million in aggregate gross proceeds.

When is the offering expected to close?

The offering is expected to close on March 27, 2024, subject to customary closing conditions.