WOBURN, Mass. - Replimune Group Inc . (NASDAQ: NASDAQ:REPL), a biotech firm specializing in oncolytic immunotherapies, has secured approximately $100 million through a private investment in public equity (PIPE) deal, the company stated Thursday. The financing is spearheaded by a life-sciences focused institutional investor, with contributions from Redmile Group, RTW Investments, Boxer Capital, and other institutional entities, including a prominent mutual fund.
The company plans to issue roughly 5.67 million shares of common stock at $8.82 per share and pre-funded warrants to purchase an equivalent number of shares at $8.819 per warrant, with the warrants exercisable at $0.001 per share. Subject to customary closing conditions, the transaction is expected to complete on June 14, 2024.
Replimune aims to use the proceeds to prepare for the commercial launch of its lead product candidate, RP1, for the treatment of skin cancers. The funds are also earmarked for general corporate purposes and working capital. Leerink Partners served as the exclusive placement agent for this financing round.
The offer and sale of the securities were conducted in a non-public offering, and thus, the securities have not been registered under the Securities Act of 1933, as amended. They may not be offered or sold in the United States without registration or an applicable exemption from registration requirements. Replimune has committed to filing a registration statement with the Securities and Exchange Commission (SEC) for the resale of the common stock and the shares issuable upon exercising the pre-funded warrants.
This PIPE financing follows encouraging primary analysis data from the RP1 IGNYTE clinical trial in patients with melanoma that did not respond to anti-PD1 therapies. Replimune anticipates filing a Biologics License Application (BLA) in the second half of 2024, with a potential product launch in the second half of 2025.
Replimune, founded in 2015 and headquartered in Woburn, Massachusetts, is pioneering a new class of oncolytic immunotherapies designed to not only kill tumors directly but also to trigger a systemic anti-tumor immune response. Their RPx product candidates are intended to complement a broad range of cancer treatments.
The information for this article is based on a press release statement from Replimune Group Inc.
In other recent news, Replimune Group has been making strides in the biotechnology sector, with notable developments in its clinical trials and positive analyst ratings. The company presented encouraging results from its IGNYTE clinical trial, which evaluated the effectiveness of RP1 in conjunction with Opdivo for the treatment of melanoma. The trial demonstrated a 33.6% overall response rate and all recorded responses to the treatment have lasted more than six months, with the median duration of response extending beyond 35 months.
H.C. Wainwright has responded to these results by raising its price target for Replimune's shares to $17.00 and reaffirming its Buy rating. BMO (TSX:BMO) Capital also maintained its Outperform rating for the company's stock, citing the positive trial results and the company's progress towards its Biologics License Application (BLA) submission expected in the second half of 2024. Barclays (LON:BARC), too, has kept its Overweight rating on the company's shares.
These recent developments have been accompanied by an executive reshuffle at Replimune, with Sushil Patel, Ph.D., taking over as CEO from Philip Astley-Sparke. The company's financial standing remains strong, with a reported cash balance of $420.7 million as of March 31, 2024. These are the recent developments shaping the course of Replimune Group.
InvestingPro Insights
As Replimune Group Inc. (NASDAQ: REPL) embarks on its journey to commercialize RP1, its financial metrics and market performance offer valuable insights to investors. With a market capitalization of $541.68 million, the company appears to have a significant valuation relative to its current financial performance. Notably, Replimune's stock has experienced a strong return over the last month, with a 33.84% increase in price total return, reflecting investor optimism possibly tied to the recent positive clinical trial data and the subsequent PIPE deal announcement.
However, the company's financial health shows signs of potential concern. Replimune's P/E ratio stands at -2.68, and despite slight improvements, the adjusted P/E ratio for the last twelve months as of Q4 2024 is still negative at -2.51, indicating that the company is not currently profitable. Moreover, Replimune holds more cash than debt on its balance sheet, which is a positive sign for the company's liquidity and financial flexibility as per the InvestingPro Tips. This is particularly relevant for a biotech firm like Replimune, where cash reserves are crucial for funding ongoing research and development activities.
Investors should be aware that analysts have revised their earnings downwards for the upcoming period, suggesting that the market may need to temper expectations for Replimune's short-term profitability. Additionally, the company does not pay a dividend to shareholders, which is common for growth-focused biotech companies reinvesting earnings into research and development rather than returning them to shareholders.
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