StemCells, Inc. Announces Closing of $20 Million Offering
July 18 2014 - 1:39PM
StemCells, Inc. (Nasdaq:STEM), today announced that it has closed
its previously announced offering of common stock and short term
warrants. The Company sold a total of 11,299,435 units to two well
recognized institutional biotechnology investors and received total
proceeds, net of offering expenses and placement agent fees, of
approximately $18.7 million. Each unit consists of one share of
common stock and a warrant to purchase 0.85 of a share of common
stock at a price of $1.77 per unit. The warrants will first be
exercisable six months from the date of issuance at an initial
exercise price of $2.17 per share. The warrants will expire at the
close of business on August 17, 2015.
"Two sophisticated investors approached us to provide $20
million of capital based upon the strength of our interim clinical
data, and our ongoing translation agenda," said Greg Schiffman,
chief financial officer of StemCells, Inc. "Moreover, this
transaction was structured with a short term warrant which provides
the investors with the potential to provide approximately $20
million in additional capital next year. The proceeds from this
financing, combined with the funds from the warrants, should they
be exercised, would provide sufficient capital to finance our
projected 2015 operating expenditures, by which time we expect to
have final data from our Phase I/II clinical programs in spinal
cord injury and dry age related macular degeneration and should
have initiated controlled proof of concept Phase II clinical
programs in both of these indications."
Ascendiant Capital Markets, LLC acted as financial advisor and
placement agent for the offering.
About StemCells, Inc.
StemCells, Inc. is engaged in the research, development, and
commercialization of cell-based therapeutics and tools for use in
stem cell-based research and drug discovery. The Company's lead
therapeutic product candidate, HuCNS-SC® cells (purified human
neural stem cells), is currently in development as a potential
treatment for a broad range of central nervous system disorders. In
a Phase I clinical trial in Pelizaeus-Merzbacher disease
(PMD), a fatal myelination disorder in children, the Company has
shown preliminary evidence of progressive and durable donor-derived
myelination in all four patients transplanted with HuCNS-SC
cells. The Company conducted a Phase I/II clinical trial in
chronic spinal cord injury in Switzerland, Canada and the United
States, and has reported positive interim data for the first eight
patients. The Company is also conducting a Phase I/II clinical
trial in dry age-related macular degeneration (AMD) in the United
States. In addition, the Company is pursuing preclinical studies in
Alzheimer's disease, with support from the California Institute for
Regenerative Medicine (CIRM). StemCells also markets
stem cell research products, including media and reagents, under
the SC Proven® brand. Further information about StemCells is
available at http://www.stemcellsinc.com.
Apart from statements of historical fact, the text of this press
release constitutes forward-looking statements within the meaning
of the U.S. securities laws, and is subject to the safe harbors
created therein. These statements include, but are not limited to,
statements regarding the future business operations of StemCells,
Inc. (the "Company"); the Company's expected use of net proceeds;
the sufficiency of the proceeds from the offering together with
proceeds from the exercise of the warrants, if any, to fund 2015
operating expenditures; and the prospect for continued clinical
development of the Company's HuCNS-SC cells in CNS disorders
including the prospect of initiating Phase II clinical studies in
dry age related macular degeneration and spinal cord
injury. These forward-looking statements speak only as of the
date of this news release. The Company does not undertake to update
any of these forward-looking statements to reflect events or
circumstances that occur after the date hereof. Such statements
reflect management's current views and are based on certain
assumptions that may or may not ultimately prove valid. The
Company's actual results may vary materially from those
contemplated in such forward-looking statements due to risks and
uncertainties to which the Company is subject, including the fact
that additional trials will be required to demonstrate the safety
and efficacy of the Company's HuCNS-SC cells for the treatment of
any disease or disorder; uncertainty as to whether the FDA or other
applicable regulatory agencies or review boards will permit the
Company to continue clinical testing in AMD or spinal cord injury;
uncertainties regarding the timing and duration of any clinical
trials; uncertainties regarding the Company's ability to recruit
the patients required to conduct its clinical trials or to obtain
meaningful results; uncertainties regarding the Company's ability
to obtain the increased capital resources needed to continue its
current and planned research and development operations;
uncertainties regarding the Company's manufacturing capabilities
given its increasing preclinical and clinical commitments;
uncertainty as to whether HuCNS-SC cells and any products that may
be generated in the future in the Company's cell-based programs
will prove safe and clinically effective and not cause tumors or
other adverse side effects; uncertainties regarding the Company's
ability to commercialize a therapeutic product and its ability to
successfully compete with other products on the market; and other
factors that are described under the heading "Risk Factors" in the
Company's Annual Report on Form 10-K for the year ended December
31, 2013, and in its subsequent reports on Form 10-Q and Form
8-K.
CONTACT: Greg Schiffman
StemCells, Inc.
Chief Financial Officer
(510) 456-4128
Andrea Flynn
Russo Partners
(646) 942-5631
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