Quoin Pharmaceuticals Announces Pricing of $6.5 Million Public Offering
Quoin Pharmaceuticals Ltd. announced a public offering of 4,062,500 ordinary shares at $1.60 per American Depositary Share, raising approximately $6.5 million. The offering includes Series D and Series E warrants with exercise prices of $1.60 per share, expiring in two and five years, respectively.
Quoin Pharmaceuticals' public offering is a capital-raising event that directly impacts its financial position and operational capabilities. The pricing of over 4 million American Depositary Shares (ADS) at $1.60 each, along with Series D and Series E warrants, signifies an influx of approximately $6.5 million in gross proceeds. This capital may be utilized for research and development, commercialization efforts, or to strengthen the company's balance sheet. It's crucial to assess the offering's pricing in relation to the current market price of Quoin's shares, as it can indicate investor sentiment and the company's valuation.
Furthermore, the immediate exercisability of the warrants could lead to potential dilution of existing shareholders if exercised, affecting the stock price. The long-term expiry of the warrants, especially the five-year Series E, introduces an element of future uncertainty regarding the company's share structure. Investors should closely monitor the uptake of these warrants and the company's subsequent deployment of the raised capital to gauge the offering's success and its impact on the company's growth trajectory.
The offering's structure, with a mix of ADS and warrants, is not uncommon in the biopharmaceutical sector, especially for companies targeting rare and orphan diseases where funding is critical for lengthy and costly clinical trials. The relatively low price per ADS could attract a broader range of investors, potentially increasing liquidity and market presence. However, the pricing also reflects market perceptions of risk associated with Quoin's pipeline and its ability to successfully bring products to market.
Investors should consider the competitive landscape of the rare disease market, which is characterized by high entry barriers and significant rewards for successful entrants. Quoin's ability to capitalize on the raised funds to overcome these barriers will be a determining factor in its long-term success and ability to provide returns to shareholders. The impact of this capital raise on Quoin's stock will largely depend on subsequent announcements regarding the progress of their pipeline and strategic use of the proceeds.
The term 'reasonable best efforts' in the context of the offering suggests a commitment by Quoin Pharmaceuticals to undertake due diligence in executing the offering but does not guarantee the sale of all securities offered. This can be a protective legal language to mitigate potential legal risks associated with the offering. From a regulatory standpoint, the issuance of ADS and warrants must comply with securities laws, including disclosure requirements and registration with the Securities and Exchange Commission (SEC).
Investors should be aware of the legal implications of the warrants, as Series D and Series E have different expiration periods. The longer expiration on Series E warrants may indicate a longer-term investment horizon for holders, potentially signaling confidence in Quoin's future prospects. The legal structure of these securities can influence investor rights, company obligations and the long-term strategic planning of Quoin Pharmaceuticals.
03/05/2024 - 08:00 AM
ASHBURN, Va., March 05, 2024 (GLOBE NEWSWIRE) -- Quoin Pharmaceuticals Ltd. (NASDAQ: QNRX) (the “Company” or “Quoin”), a specialty pharmaceutical company focused on rare and orphan diseases, today announced the pricing of its "reasonable best efforts" public offering of 4,062,500 ordinary shares represented by 4,062,500 American Depositary Shares (or pre-funded warrants in lieu thereof), Series D warrants to purchase an aggregate of up to 4,062,500 ordinary shares represented by 4,062,500 American Depositary Shares and Series E warrants to purchase an aggregate of up to 4,062,500 ordinary shares represented by 4,062,500 American Depositary Shares at a combined purchase price of $1.60 per American Depositary Share and associated Series D warrant and Series E warrant for aggregate gross proceeds of approximately $6.5 million before deducting placement agent fees and other offering expenses. The Series D and Series E warrants will have an exercise price of $1.60 per share, will be exercisable immediately following the date of issuance and will expire in two years and five years, respectively, from their issuance.
The closing of the offering is expected to occur on or about March 7, 2024, subject to the satisfaction of customary closing conditions. The Company intends to use the net proceeds from the offering for general corporate purposes.
A.G.P./Alliance Global Partners is acting as the sole placement agent for the offering.
In connection with the offering, the Company has entered into an agreement with existing investors of the Company to reduce the exercise price of outstanding warrants to purchase up to 638,834 ADS which were issued in the Company's August, 2022 and February, 2023 public offerings (the "Prior Warrants") from $13.20 per ADS with respect to the August 2022 warrants and $12.00 per ADS with respect to the February 2023 warrants (both prices having been adjusted pursuant to the Company’s one-for-twelve reverse stock split effective July 18, 2023) to $1.60 per ADS, effective upon the closing of this offering. Additionally, the term of the Prior Warrants shall be amended such that the new termination date shall be March 7, 2029.
A registration statement on Form S-1, as amended (No. 333-277016) (“Form S-1”), relating to the offering was filed with the Securities and Exchange Commission (“SEC”), and it was declared effective on February 14, 2024. The offering is being made only by means of a prospectus forming part of the effective registration statement. Copies of the preliminary prospectus and, when available, copies of the final prospectus, relating to the offering may be obtained on the SEC’s website located at http://www.sec.gov. Electronic copies of the final prospectus relating to the offering may be obtained, when available, from A.G.P./Alliance Global Partners, 590 Madison Avenue, 28th Floor, New York, NY 10022, or by telephone at (212) 624-2060, or by email at prospectus@allianceg.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 other jurisdiction in which such offer, solicitation, or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.
About Quoin Pharmaceuticals Ltd.
Quoin Pharmaceuticals Ltd. is a clinical stage specialty pharmaceutical company focused on developing and commercializing therapeutic products that treat rare and orphan diseases. We are committed to addressing unmet medical needs for patients, their families, communities and care teams. Quoin’s innovative pipeline comprises four products in development that collectively have the potential to target a broad number of rare and orphan indications, including Netherton Syndrome, Peeling Skin Syndrome, Palmoplantar Keratoderma, Scleroderma, Epidermolysis Bullosa and others. For more information, visit: www.quoinpharma.com or LinkedIn for updates.
Cautionary Note Regarding Forward Looking Statements
The Company cautions that statements in this press release that are not a description of historical facts, including, but not limited to, statements regarding the offering, the expected gross proceeds and the expected closing of the offering, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words referencing future events or circumstances such as "expect," "intend," "plan," "anticipate," "believe," and "will," among others. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. These forward-looking statements are based upon the Company’s current expectations and involve assumptions that may never materialize or may prove to be incorrect. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties. More detailed information about the risks and uncertainties affecting the Company is contained under the heading "Risk Factors" included in Form S-1 and in other filings the Company has made and may make with the SEC in the future. One should not place undue reliance on these forward-looking statements, which speak only as of the date on which they were made. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. The Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as may be required by law.
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Investor Relations
What is the pricing of Quoin Pharmaceuticals Ltd.'s public offering?
Quoin Pharmaceuticals Ltd. priced its public offering at $1.60 per American Depositary Share, raising approximately $6.5 million.
How many ordinary shares were offered in Quoin Pharmaceuticals Ltd.'s public offering?
Quoin Pharmaceuticals Ltd. offered 4,062,500 ordinary shares in its public offering.
What are the exercise prices of the Series D and Series E warrants in Quoin Pharmaceuticals Ltd.'s offering?
The Series D and Series E warrants in Quoin Pharmaceuticals Ltd.'s offering have an exercise price of $1.60 per share.
When will the Series D and Series E warrants in Quoin Pharmaceuticals Ltd.'s offering expire?
The Series D warrants will expire in two years, and the Series E warrants will expire in five years from their issuance.
