Genprex Announces Closing of $6.5 Million Registered Direct Offering Priced At-the-Market Under Nasdaq Rules

Rhea-AI Summary

Genprex, Inc. (GNPX) successfully closed a registered direct offering, raising approximately $6.5 million through the sale of 1,542,112 shares of common stock and warrants. The company intends to utilize the net proceeds for working capital and general corporate purposes. H.C. Wainwright & Co. served as the exclusive placement agent for the offering.

Financial Analyst

The completion of Genprex's registered direct offering is a strategic financial move, likely aiming to bolster the company's balance sheet. With a gross proceed of approximately $6.5 million before expenses, the infusion of capital is modest for a clinical-stage company. The pricing strategy, at $4.215 per share and warrants exercisable at $4.09, suggests a confidence in maintaining stock value above the exercise price, which could be indicative of the company's positive outlook on their pipeline's potential.

However, the amendment of existing warrants with a significant reduction in exercise price from $44.00 and $35.40 to $4.09 might raise concerns about previous overvaluation or a strategic adjustment to facilitate the exercise of these warrants. This could potentially dilute existing shareholders but also reflects a more accessible price point for warrant holders to invest further in the company.

Investors should monitor how the capital is allocated towards working capital and general corporate purposes, as it may influence the company's ability to reach significant clinical milestones, which in turn could affect the stock's performance.

Biotech Market Analyst

Genprex's direct offering is a common practice within the biotech industry, particularly for clinical-stage companies that often require substantial funding to advance their research and development. The decision to use net proceeds for working capital and general corporate purposes is typical, as liquidity is important for ongoing trials and operations.

However, the impact on the stock market will likely depend on how investors perceive the company's current valuation and the potential of its gene therapy treatments. Given the competitive nature of the biotech sector, Genprex's ability to differentiate its therapies and show progress in clinical trials will be key factors in maintaining investor interest and stock stability.

Considering the exercise price of the warrants is close to the offering price, it suggests a calculated risk on behalf of the investors, anticipating that the stock value will not depreciate significantly in the near term. This could be seen as a vote of confidence in Genprex's strategic direction and future announcements regarding their therapies.

Securities Legal Expert

Genprex adhered to regulatory requirements by filing the necessary registration statement with the SEC and ensuring the offering was conducted via a prospectus. This is a standard procedure to ensure transparency and compliance with securities laws. The amendment of existing warrants is also a legal maneuver that requires careful disclosure, as it alters the terms under which the securities were initially sold.

While the legal framework appears to have been followed correctly, investors should be aware of the implications of such amendments, as they can affect the rights and potential returns of both current and future security holders. The reduction in exercise price for the amended warrants is a notable change that could influence investor sentiment and the perceived value of the company's stock.

It is also important to note that the press release's disclaimer about the offering not constituting an offer to sell securities in jurisdictions where it would be unlawful is a standard protective statement to prevent legal disputes related to the sale of securities.

AUSTIN, Texas, March 22, 2024 /PRNewswire/ -- Genprex, Inc. ("Genprex" or the "Company") (NASDAQ: GNPX), a clinical-stage gene therapy company focused on developing life-changing therapies for patients with cancer and diabetes, today announced the closing on March 21, 2024 of its previously announced registered direct offering priced at-the-market under the Nasdaq rules for the sale and issuance of 1,542,112 shares of common stock (or prefunded warrants in lieu thereof) of the Company and warrants to purchase up to 1,542,112 shares of common stock at a combined offering price of $4.215 per share of common stock (or per prefunded warrant in lieu thereof) and accompanying warrant. The warrants have an exercise price of $4.09 per share, are exercisable on the date of issuance, and will expire five years following the date of issuance.

H.C. Wainwright & Co. acted as the exclusive placement agent for the offering.

The gross proceeds to Genprex from this offering were approximately $6.5 million, before deducting the placement agent's fees and other offering expenses. Genprex intends to use the net proceeds from this offering for working capital and general corporate purposes.

A "shelf" registration statement (File Number 333-271386) relating to the offered securities was filed with the Securities and Exchange Commission ("SEC") on April 21, 2023 and was declared effective on June 9, 2023. The offering of the securities was made only by means of a prospectus, including a prospectus supplement, forming a part of an effective registration statement. A prospectus supplement and accompanying prospectus relating to the offering were filed with the SEC. Electronic copies of the prospectus supplement and accompanying prospectus may be obtained on the SEC's website at www.sec.gov or by contacting H.C. Wainwright & Co., LLC at 430 Park Avenue, 3rd Floor, New York, NY 10022, by phone at (212) 856-5711 or e-mail at placements@hcwco.com.

The Company also amended certain existing warrants to purchase up to an aggregate of 194,248 shares of the Company's common stock that were previously issued to investors in March 2023 and July 2023, with exercise prices of $44.00 and $35.40 per share and expiration dates of March 1, 2028 and July 21, 2028 for $0.125 per amended warrant, such that the amended warrants have a reduced exercise price of $4.09 per share and an expiration date of five years from the closing of the offering.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, 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 Genprex, Inc.

Genprex, Inc. is a clinical-stage gene therapy company focused on developing life-changing therapies for patients with cancer and diabetes. Genprex's technologies are designed to administer disease-fighting genes to provide new therapies for large patient populations with cancer and diabetes who currently have limited treatment options. Genprex works with world-class institutions and collaborators to develop drug candidates to further its pipeline of gene therapies in order to provide novel treatment approaches. Genprex's oncology program utilizes its systemic, non-viral Oncoprex® Delivery System which encapsulates the gene-expressing plasmids using lipid nanoparticles. The resultant product is administered intravenously, where it is taken up by tumor cells that then express tumor suppressor proteins that were deficient in the tumor. The Company's lead product candidate, Reqorsa® Immunogene Therapy (quaratusugene ozeplasmid), is being evaluated in three clinical trials as a treatment for NSCLC and SCLC. Each of Genprex's three lung cancer clinical programs has received a Fast Track Designation from the FDA for the treatment of that patient population, and Genprex's SCLC program has received an FDA Orphan Drug Designation. Genprex's diabetes gene therapy approach is comprised of a novel infusion process that uses an AAV vector to deliver Pdx1 and MafA genes directly to the pancreas. In models of Type 1 diabetes, GPX-002 transforms alpha cells in the pancreas into functional beta-like cells, which can produce insulin but may be distinct enough from beta cells to evade the body's immune system. In a similar approach, GPX-003 for Type 2 diabetes, where autoimmunity is not at play, is believed to rejuvenate and replenish exhausted beta cells. 

For more information, please visit the Company's web site at www.genprex.com or follow Genprex on Twitter, Facebook and LinkedIn.

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 intended use of proceeds from the registered direct offering and other statements that are predictive in nature. 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 and involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any results, performance or achievements expressed or implied by the forward-looking statements. Such factors include the risk factors set forth in the Company's filings with the SEC, including, without limitation, its Annual Report on Form 10-K for the year ended December 31, 2022, its periodic reports on Form 10-Q, and its Current Reports on Form 8-K filed in 2023 and 2024, as well as the risks identified in the shelf registration statement and the prospectus supplement relating to the offering. 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. Genprex undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

Genprex, Inc.
(877) 774-GNPX (4679)

GNPX Investor Relations
investors@genprex.com 

GNPX Media Contact
Kalyn Dabbs
media@genprex.com 

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SOURCE Genprex, Inc.

What type of offering did Genprex, Inc. (GNPX) recently close?

Genprex, Inc. (GNPX) closed a registered direct offering.

How much money did Genprex, Inc. (GNPX) raise through the offering?

Genprex, Inc. (GNPX) raised approximately $6.5 million.

What will Genprex, Inc. (GNPX) use the net proceeds from the offering for?

Genprex, Inc. (GNPX) intends to use the net proceeds for working capital and general corporate purposes.

Who acted as the exclusive placement agent for the offering by Genprex, Inc. (GNPX)?

H.C. Wainwright & Co. acted as the exclusive placement agent for the offering by Genprex, Inc. (GNPX).

What is the exercise price and expiration date of the warrants issued by Genprex, Inc. (GNPX)?

The warrants issued by Genprex, Inc. (GNPX) have an exercise price of $4.09 per share and will expire five years following the date of issuance.