Onconetix Announces Financing Through a $12.9 Million Private Placement of Series D Preferred Stock and Warrants, Termination of Merger Agreement with Ocuvex, Inc. and Settlement of $8.8 Million Debt with Veru, Inc.

Rhea-AI Summary

Onconetix (NASDAQ:ONCO), a biotechnology company focused on men's health and oncology, has announced multiple significant financial transactions. The company has secured a $12.9 million private placement through Series D Preferred Stock and Warrants, with $9.3 million paid in cash and the remainder offsetting existing debts.

The financing includes warrants to purchase up to 4,362,827 shares of common stock at an initial exercise price of $3.6896 per share. Additionally, Onconetix has settled its $8.8 million debt with Veru, Inc. through a combination of $6.3 million cash payment and conversion of $2.5 million into Series D Preferred Stock and warrants. The company has also terminated its previously planned merger with Ocuvex, Inc.

Positive

• Secured $12.9 million in financing through private placement
• Successfully settled $8.8 million debt with Veru Inc.
• Strengthened balance sheet through debt resolution

Negative

• Termination of merger agreement with Ocuvex Inc.
• Potential dilution from conversion of Series D Preferred Stock and warrants
• Significant portion of financing ($6.3M) immediately used for debt payment

Insights

Financial Restructuring Specialist

Onconetix secures $12.9M financing while settling significant debt and abandoning merger plans, suggesting financial restructuring under challenging circumstances.

This financing transaction represents a critical financial restructuring for Onconetix amid apparent distress signals. The $12.9 million private placement combines $9.3 million in cash with debt conversion components, suggesting the company needed immediate capital infusion. The transaction's structure—using Series D Preferred Stock with warrants at $3.6896 per share—indicates investors demanded significant upside potential through future equity participation in exchange for the capital risk.

The termination of the Ocuvex merger agreement signals a strategic pivot, likely because either due diligence revealed unfavorable findings or market conditions deteriorated. Most telling is the $8.8 million debt settlement with Veru, where only $6.3 million was paid in cash while $2.5 million converted to equity—a classic debt restructuring move typically seen when companies face liquidity constraints.

The financial mechanics reveal careful negotiation with creditors: Veru accepted approximately 72% cash payout with the remainder converted to equity participation, suggesting they retain some confidence in Onconetix's long-term prospects despite current challenges. Meanwhile, the disclosure that some proceeds will cover costs associated with the failed merger indicates unanticipated expenses that further strained the company's financial position.

Corporate Strategy Analyst

This announcement reveals a significant strategic redirection for Onconetix. The company has essentially abandoned its merger strategy with Ocuvex while simultaneously addressing its capital structure through both equity financing and debt restructuring. This multi-pronged approach suggests management is implementing a comprehensive financial stabilization plan rather than pursuing immediate growth through acquisition.

The specific financing structure—preferred stock with warrants—provides important insights into investor sentiment. The relatively short three-year warrant term indicates investors want potential quick exits rather than long-term participation. Additionally, the immediate conversion rights of the preferred stock suggest investors negotiated for downside protection with upside potential, a cautious approach typically seen when backing companies in transitional phases.

The statement that proceeds will fund "working capital and general corporate purposes" lacks specificity about product development or market expansion initiatives, indicating an immediate focus on stabilization rather than growth. By terminating the Ocuvex merger while simultaneously raising capital, Onconetix appears to be simplifying its corporate structure to focus on its core business in men's health and oncology rather than pursuing diversification through acquisition. This suggests management believes strengthening the foundation will generate more shareholder value than pursuing immediate expansion.

CINCINNATI, OH, Sept. 26, 2025 (GLOBE NEWSWIRE) -- Onconetix, Inc. (Nasdaq: ONCO) ("Onconetix" or the “Company”) a commercial stage biotechnology company focused on the research, development and commercialization of innovative solutions for men’s health and oncology, announced the September 22, 2025 signing and closing of a private placement of (i) shares of the Company's Series D Convertible Preferred Stock, $0.00001 par value (the "Series D Preferred Stock"), and (ii) warrants (the "Warrants") to purchase up to an aggregate of 4,362,827 shares of the Company's common stock, $0.00001 par value per share (the "Common Stock"), for an aggregate purchase price of approximately $12.9 million (the “Financing Transaction”). Approximately $9.3 million was paid in cash and the balance was used to offset certain amounts owed by the Company to certain investors. The Series D Preferred Stock are initially convertible into an aggregate of 4,362,827 shares of Common Stock, subject to certain anti-dilution adjustments. The Warrants will have an initial exercise price of $3.6896 per share, subject to certain anti-dilution adjustments, and are exercisable beginning on the issuance date (the "Initial Exercisability Date") and expiring on the third anniversary of the Initial Exercisability Date.

The Company has filed a Current Report on Form 8-K with the Securities and Exchange Commission on September 26, 2025, with additional details of the transaction. The Company agreed to seek stockholder approval for the issuance of all of the shares of Common Stock issuable upon conversion of the Series D Preferred Stock and exercise of the Warrants in accordance with the rules and regulations of the Nasdaq Stock Market.

In full satisfaction of the Company’s approximately $8.8 million debt to Veru, Inc., approximately $6.3 million of the cash proceeds from the Financing Transaction was paid to Veru, Inc., and the remaining $2.5 million of debt was converted into 3,125 shares of Series D Preferred Stock and 846,975 warrants as part of the Financing Transaction. The Company intends to use the remaining net cash proceeds from the Financing Transaction to cover costs and expenses associated with the termination of a previously contemplated business combination with Ocuvex, Inc., and for working capital and general corporate purposes.

About Onconetix, Inc.

Onconetix (Nasdaq: ONCO) is a commercial stage biotechnology company focused on the research, development and commercialization of innovative solutions for men’s health and oncology. Through our acquisition of Proteomedix, we own Proclarix®, an in vitro diagnostic test for prostate cancer originally developed by Proteomedix and approved for sale in the European Union (“EU”) under the IVDR. For more information, visit www.onconetix.com.

Forward-Looking Statements

Certain statements in this press release are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of forward-looking words such as “anticipate,” “believe,” “forecast,” “estimate,” “expect,” and “intend,” among others. These forward-looking statements (including, without limitation, the use of proceeds from the Financing Transaction as described herein) are based on Onconetix’s current expectations and actual results could differ materially. There are a number of factors that could cause actual events to differ materially from those indicated by such forward-looking statements. These factors include, but are not limited to, market and other conditions; risks related to Onconetix’s ability to commercialize or monetize Proclarix and integrate the assets and commercial operations acquired in the share exchange with Proteomedix; risks related to the Company’s present need for capital to commercially launch Proclarix and have adequate working capital; and risks related to Onconetix’s ability to raise additional capital to sustain the Company’s operations. As with any commercial-stage pharmaceutical product or any product candidate under clinical development, there are significant risks in the development, regulatory approval and commercialization of biotechnology products. Onconetix does not undertake an obligation to update or revise any forward-looking statement. Investors should read the risk factors set forth in Onconetix’s Annual Report on Form 10-K, filed with the SEC on June 2, 2025 and periodic reports filed with the SEC on or after the date thereof. All of Onconetix’s forward-looking statements are expressly qualified by all such risk factors and other cautionary statements. The information set forth herein speaks only as of the date thereof.

Contact Information:

Onconetix, Inc.
201 E. Fifth Street, Suite 1900
Cincinnati, OH 45202
Phone: (513) 620-4101

Investor Contact Information:

Onconetix Investor Relations Email: investors@onconetix.com

FAQ

What is the size of Onconetix's (NASDAQ:ONCO) recent private placement financing?

Onconetix secured a $12.9 million private placement through Series D Preferred Stock and Warrants, with $9.3 million paid in cash and the remainder offsetting existing debts.

How did Onconetix (NASDAQ:ONCO) settle its debt with Veru Inc.?

Onconetix settled its $8.8 million debt with Veru Inc. by paying $6.3 million in cash and converting the remaining $2.5 million into Series D Preferred Stock and warrants.

What are the terms of Onconetix's (NASDAQ:ONCO) new warrants?

The warrants have an initial exercise price of $3.6896 per share, are exercisable immediately upon issuance, and expire after three years. They allow purchase of up to 4,362,827 shares of common stock.

What will Onconetix (NASDAQ:ONCO) use the financing proceeds for?

Onconetix will use the remaining net proceeds to cover costs related to the terminated Ocuvex merger and for working capital and general corporate purposes.

What happened to Onconetix's (NASDAQ:ONCO) merger with Ocuvex?

Onconetix has terminated its previously planned business combination with Ocuvex, Inc., and will use part of the new financing to cover costs associated with the termination.