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PepGen Announces Pricing of $80.1 Million Underwritten Offering of Common Stock

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PepGen Inc. announced the pricing of an underwritten offering of 7,530,000 shares of its common stock at a price to the public of $10.635 per share, with expected gross proceeds of approximately $80.1 million. The offering aims to support the company's advancement of oligonucleotide therapies for severe neuromuscular and neurological diseases.
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The announcement by PepGen Inc. of an underwritten offering of 7,530,000 shares at $10.635 per share, totaling approximately $80.1 million in gross proceeds, is a significant financial event for the company. This capital raise is crucial for funding ongoing research and development activities, particularly as PepGen is in the clinical stage and thus not yet generating revenue from product sales. The offering price is reflective of the market's current valuation of PepGen's potential and the fresh capital is likely to extend the company's runway, allowing further progress in their clinical programs.

The influx of capital will also impact the company's balance sheet, providing more financial flexibility. However, existing shareholders might be concerned about dilution, as the increase in the number of shares outstanding can lead to a decrease in earnings per share and potentially affect share price. Investors will be closely monitoring how effectively PepGen utilizes this capital to advance their pipeline and create shareholder value.

In the context of the biotechnology sector, PepGen's move to raise capital through a public offering is a strategic one. The sector is heavily reliant on continuous investment to fuel the costly and lengthy process of drug development. The success of such an offering is often a barometer of investor confidence in the company's technology and prospects. For competitors and peers in the neuromuscular and neurological disease space, this successful capital raise may signal a healthy investment climate and could potentially lead to a wave of similar offerings from other firms seeking to capitalize on favorable market conditions.

Market sentiment following the announcement will be telling, as it could influence the stock's liquidity and volatility in the short term. Moreover, the pricing of the offering at $10.635 per share gives an indication of how the market currently values PepGen's technology and market potential, which can be a reference point for valuations of similar companies in the biotech industry.

PepGen's focus on oligonucleotide therapies for severe neuromuscular and neurological diseases places it within a highly specialized and innovative segment of the biotech industry. Oligonucleotide therapies represent a cutting-edge approach to treating genetic disorders by modulating gene expression or altering genetic information. The capital raised through this stock offering is likely earmarked for advancing their pipeline, which could include preclinical studies, clinical trials, or the development of their drug delivery platform.

The long-term implications of this offering for stakeholders include the potential for PepGen to reach critical clinical milestones that can significantly de-risk their therapeutic candidates. Success in these areas could not only benefit patients with limited treatment options but also lead to substantial commercial opportunities for PepGen. It's important for stakeholders to consider the inherent risks of drug development, as clinical trial outcomes are uncertain and the path to regulatory approval is complex and challenging.

BOSTON, Feb. 07, 2024 (GLOBE NEWSWIRE) -- PepGen Inc. (Nasdaq: PEPG), a clinical-stage biotechnology company advancing the next generation of oligonucleotide therapies with the goal of transforming the treatment of severe neuromuscular and neurological diseases, today announced the pricing of an underwritten offering of 7,530,000 shares of its common stock at a price to the public of $10.635 per share. The aggregate gross proceeds to PepGen from this offering are expected to be approximately $80.1 million, before deducting underwriting discounts and commissions and offering expenses payable by PepGen. The offering is expected to close on or about February 9, 2024, subject to customary closing conditions.

The financing was led by RA Capital Management, with participation by new and existing institutional investors, including Adage Capital Partners L.P., Frazier Life Sciences, Invus, Janus Henderson Investors, Laurion Capital Management LP, Monashee Investment Management, Octagon Capital, Perceptive Advisors and Suvretta Capital. 

Leerink Partners is acting as the sole book-running manager for the offering.

PepGen currently intends to use the net proceeds from this offering to fund ongoing research and clinical development of its product candidates, as well as for working capital and other general corporate purposes.

The shares of common stock are being offered pursuant to a registration statement on Form S-3 that was previously filed with, and subsequently declared effective on June 16, 2023 by, the Securities and Exchange Commission (“SEC”). A final prospectus supplement and accompanying prospectus related to the offering will be filed with the SEC, and are or will be available on the SEC's website located at http://www.sec.gov. Copies of the final prospectus supplement and the accompanying prospectus relating to the offering, when available, may be obtained from: Leerink Partners LLC, Syndicate Department, 53 State Street, 40th Floor, Boston, MA 02109, or by telephone at (800) 808-7525 ext. 6105, or by email at syndicate@leerink.com.

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 PepGen
PepGen Inc. is a clinical-stage biotechnology company advancing the next-generation of oligonucleotide therapies with the goal of transforming the treatment of severe neuromuscular and neurological diseases. PepGen’s Enhanced Delivery Oligonucleotide, or EDO, platform is founded on over a decade of research and development and leverages cell-penetrating peptides to improve the uptake and activity of conjugated oligonucleotide therapeutics. Using these EDO peptides, PepGen is generating a pipeline of oligonucleotide therapeutic candidates that are designed to target the root cause of serious diseases.

Forward Looking Statements
This press release contains forward-looking statements. Any such statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Any forward-looking statements in this press release are based on PepGen’s current expectations, estimates and projections only as of the date of this release and are subject to a number of risks and uncertainties that could cause actual results to differ materially and adversely from those set forth in or implied by such forward-looking statements. These risks and uncertainties related to completion of the proposed offering on the anticipated terms, or at all, include, but are not limited to, market conditions and the satisfaction of customary closing conditions related to the proposed offering. Additional risks concerning PepGen’s programs and operations are described in our most recent annual report on Form 10-K and quarterly report on Form 10-Q that are filed with the SEC. PepGen explicitly disclaims any obligation to update any forward-looking statements except to the extent required by law.

Investor Contact
Laurence Watts
Gilmartin Group
Laurence@gilmartinir.com

Media Contact
Sarah Sutton
Argot Partners
Pepgen@argotpartners.com 


The underwritten offering consists of 7,530,000 shares of common stock priced at $10.635 per share.

The expected gross proceeds from the offering are approximately $80.1 million.

PepGen aims to transform the treatment of severe neuromuscular and neurological diseases with its next generation oligonucleotide therapies.

The offering is expected to close on or before a specified date.
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