Diffusion Pharmaceuticals Inc. (Nasdaq: DFFN)
(“Diffusion” or “the Company”), a cutting-edge biotechnology
company developing new treatments for life-threatening medical
conditions by improving the body's ability to deliver oxygen to the
areas where it is needed most, today announced the closing of its
previously announced registered direct offering, priced
at-the-market under Nasdaq rules, with certain
institutional and accredited investors of 11,428,572 shares of
the Company’s common stock, at a purchase price of $1.05 per share.
The gross proceeds to Diffusion, before deducting placement agent
fees and other offering expenses, were approximately $12.0 million.
H.C. Wainwright & Co. acted as the exclusive
placement agent for the offering.
Diffusion currently intends to use the net
proceeds from the offering to fund research and development of its
lead product candidate, TSC, including clinical trial activities,
and for general corporate purposes.
The shares of common stock were offered pursuant
to a “shelf” registration statement on Form S-3 (File No.
333-231541), which was declared effective by the Securities and
Exchange Commission (SEC) on May 22, 2019. A prospectus supplement
and the accompanying prospectus relating to the registered direct
offering were filed with the SEC. Electronic copies of the
prospectus supplement and the accompanying prospectus relating to
the registered direct offering may be obtained from H.C. Wainwright
& Co., LLC, 430 Park Avenue 3rd Floor, New York, New York
10022, or by calling (646) 975-6996 or by emailing
placements@hcwco.com or at the SEC’s website
at http://www.sec.gov.
This press release shall not constitute an offer
to sell or the solicitation of an offer to buy, nor shall there be
any sale of these securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful prior to the
registration or qualification under the securities laws of any such
jurisdiction.
About Diffusion Pharmaceuticals
Inc.
Diffusion Pharmaceuticals Inc. is an innovative
biotechnology company developing new treatments that improve the
body’s ability to deliver oxygen to the areas where it is needed
most, offering new hope for the treatment of life-threatening
medical conditions. Diffusion’s lead drug trans sodium crocetinate
(TSC) was originally developed in conjunction with the Office of
Naval Research, which was seeking a way to treat multiple organ
failure and its resulting mortality caused by the systemic
hypoxemia from blood loss on the battlefield. Evolutions in
research have led to Diffusion’s focus today: Fueling Life by
taking on some of medicine’s most intractable and
difficult-to-treat diseases, including multiple organ failure,
stroke and glioblastoma multiforme (GBM) brain cancer. In each of
these diseases, hypoxia – oxygen deprivation of essential tissue in
the body – has proved to be a significant obstacle for medical
providers and is the target for TSC’s novel mechanism.
In July 2019 the Company reported favorable
safety data in a 19-patient dose-escalation run-in study to its
Phase 3 INTACT program, using TSC to target inoperable GBM. Further
findings from the dose-escalation run-in study, released in
December 2019, also showed possible signals of enhanced survival
and patient performance. Diffusion’s in-ambulance PHAST-TSC trial
for acute stroke began enrolling patients last year. Given the
heightened responsibilities of the Company’s emergency medical
services providers, enrollment in this trial is expected to be
minimal until the COVID-19 pandemic abates. The Company is also
currently partnering with the University of Virginia and iTHRIV in
a research program to develop its novel small molecule TSC as a
treatment for Acute Respiratory Distress Syndrome (ARDS) from
COVID-19, specifically targeting the associated multiple organ
failure.
Preclinical data supports the potential for TSC
as a treatment for other conditions where hypoxia plays a major
role, such as myocardial infarction, peripheral artery disease, and
neurodegenerative conditions such as Alzheimer’s and Parkinson’s
disease. In addition, RES-529, the Company’s PI3K/AKT/mTOR pathway
inhibitor that dissociates the mTORC1 and mTORC2 complexes, is in
preclinical testing for GBM.
Diffusion is headquartered in Charlottesville,
Virginia – a hub of advancement in the life science and
biopharmaceutical industries – and is led by CEO David Kalergis, a
30-year industry veteran and company co-founder.
Forward-Looking Statements
To the extent any statements made in this news
release deal with information that is not historical, these are
forward-looking statements under the Private Securities Litigation
Reform Act of 1995. Such statements include, but are not limited
to, statements regarding the use of proceeds, as well as statements
about the company's plans, objectives, expectations and intentions
with respect to future operations and products, the potential of
the company's technology and product candidates, and other
statements that are not historical in nature, particularly those
that utilize terminology such as "would," "will," "plans,"
"possibility," "potential," "future," "expects," "anticipates,"
"believes," "intends," "continue," "expects," other words of
similar meaning, derivations of such words and the use of future
dates. Forward-looking statements by their nature address matters
that are, to different degrees, uncertain. Uncertainties and risks
may cause the Diffusion’s actual results to be materially different
than those expressed in or implied by such forward-looking
statements. Particular uncertainties and risks include: the
uncertainty as to whether Diffusion's pre-IND submission will be
ultimately acceptable to the FDA for an IND submission or that the
FDA will not require significant changes that might take
significant time to implement, if at all, or that any such required
changes will be financially feasible; moreover, if the protocol in
Diffusion's pre-IND submission or a revised protocol is acceptable
to the FDA for an IND submission, there can be no assurance as to
when the FDA might provide such guidance or when the program might
be able to commence, if at all; the uncertainty that as of yet the
FDA has no approved a trial evaluating TSC for the treatment of
ARDS, or if approved, such a trial possibly entailing significant
additional time, effort and expense, particularly in light of the
difficulty of doing business during the COVID-19 pandemic;
Diffusion’s ability to maintain its Nasdaq listing, the use of
proceeds of the offering, market and other conditions, the
difficulty of developing pharmaceutical products, obtaining
regulatory and other approvals and achieving market acceptance;
general business and economic conditions; the sufficiency of the
company’s cash, the company's need for and ability to obtain
additional financing or partnering arrangements; and the various
risk factors (many of which are beyond Diffusion’s control) as
described under the heading “Risk Factors” in Diffusion’s filings
with the United States Securities and Exchange Commission. All
forward-looking statements in this news release speak only as of
the date of this news release and are based on management's current
beliefs and expectations. Diffusion undertakes no obligation to
update or revise any forward-looking statement, whether as a result
of new information, future events or otherwise, except as required
by law.
Contacts:David Kalergis,
CEODiffusion Pharmaceuticals Inc.(434)
220-0718dkalergis@diffusionpharma.com
LHA Investor RelationsKim Sutton Golodetz(212)
838-3777kgolodetz@lhai.com
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