Opus Genetics, Inc. (NASDAQ:IRD), currently valued at $38.2 million in market capitalization, has announced the establishment of an at-the-market equity issuance program to offer and sell shares of its common stock up to an aggregate offering price of $40 million.
The announcement comes as the stock has experienced a significant 14.79% decline over the past week, though InvestingPro analysis indicates the company maintains a strong liquidity position with a current ratio of 6.63. The announcement was made on Monday, and the program is intended to provide the company with capital for general corporate purposes, including the advancement of product candidates and funding for clinical trials and preclinical studies.
The company entered into a sales agreement with Leerink Partners LLC, through which the shares will be sold. This arrangement allows for the sale of shares by any method deemed to be an "at-the-market offering", including sales made directly on the Nasdaq or to a market maker.
According to InvestingPro data, the timing of this offering is crucial as analysts have recently revised their earnings expectations downward, with projections indicating the company may not achieve profitability this year. Leerink Partners has agreed to execute sales based on instructions from Opus Genetics, with a 3.0% commission on the gross sales proceeds.
The funds raised from this offering are expected to be invested in interest-bearing, investment-grade securities, certificates of deposit, or government securities, until they are used for their intended corporate purposes.
Subscribers to InvestingPro can access 9 additional key insights about the company's financial health and future prospects. However, the company's management retains broad discretion over the use of net proceeds, as specific allocations have not been fully determined.
This new equity program replaces the previous Capital on DemandTM Sales Agreement with JonesTrading Institutional Services LLC, which was terminated upon the initiation of the new agreement. Under the prior arrangement, approximately $26.4 million worth of shares had been sold.
In other recent news, Opus Genetics Inc. has reached a Special Protocol Assessment agreement with the U.S. Food and Drug Administration for a Phase 3 clinical trial of APX3330, an oral medication being tested for moderate to severe non-proliferative diabetic retinopathy.
This comes alongside the company's merger with Ocuphire Pharma, forming a new entity focused on inherited retinal diseases. The merger is expected to enhance their pipeline, including the OPGx-LCA5 gene therapy candidate and the Phentolamine Ophthalmic Solution 0.75%.
H.C. Wainwright has assigned a Buy rating to Opus Genetics, citing the potential of the company's inherited retinal disease platform and the 2025 catalysts for ongoing innovation. The company's Leber Congenital Amaurosis (LCA) and Best Vitelliform Macular Dystrophy (BEST1) developments were particularly noted by the analyst firm.
Moreover, Opus Genetics is seeking partners to fund further development as it continues to concentrate on advancing gene therapy candidates for inherited retinal diseases. The company's pipeline includes gene therapies targeting various forms of bestrophinopathy, Leber congenital amaurosis, retinitis pigmentosa, and other ophthalmologic disorders. Despite current challenges reflected in negative earnings per share of $1.09, these recent developments underscore Opus Genetics' commitment to advancing treatments for eye conditions.
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