BELLUS Health Inc. (TSX: BLU) (“BELLUS Health” or the “Company”), a
clinical-stage biopharmaceutical company, today announced that it
has closed an equity offering, issuing a total of 36,842,105 common
shares for gross proceeds of $35 million (the "Offering"). The
Offering was led by OrbiMed and also included New Leaf Venture
Partners, First Manhattan Co., Samsara BioCapital, Fonds de
solidarité FTQ, AppleTree Partners and Amzak Health. In connection
with the financing, Mr. Chau Q. Khuong, Partner at OrbiMed, has
joined the Company’s Board of Directors.
“This financing culminates a transformational
year for BELLUS Health during which we also delivered positive
Phase 1 data for our lead drug candidate, BLU-5937, for chronic
cough,” said Roberto Bellini, President and CEO of BELLUS Health.
“We are pleased to have the support and confidence of this
high-quality group of healthcare-focused investors. This funding
will enable us to advance the clinical development of BLU-5937 as
expeditiously as possible. Accordingly, we look forward to
initiating our Phase 2 study in chronic cough patients in
mid-2019.”
“BELLUS Health has an innovative scientific
platform and its potential best-in-class P2X3 antagonist, BLU-5937,
holds significant promise for patients afflicted with chronic
cough,” said Mr. Khuong, Partner at OrbiMed. “We are excited to
work with the Company’s Board of Directors and management team to
move BLU-5937 forward in clinical development and to continue
driving value for BELLUS Health and its stakeholders.”
Details of the Offering
Bloom Burton Securities Inc. acted as lead agent
and book running manager for the Offering on behalf of a syndicate
of agents that also included Mackie Research Capital Corporation.
Robert W. Baird & Co. Incorporated acted as financial advisor
to BELLUS Health in connection with the financing.
Under the Offering, subscribers purchased a
total of 36,842,105 common shares at a price of $0.95 per
share for aggregate gross proceeds of $35 million. The
Offering price of $0.95 per share is an 8% discount to the closing
price the day before the announcement of the financing.
In Canada, the common shares purchased pursuant
to the Offering were qualified for sale by way of a prospectus
supplement dated December 13, 2018 to BELLUS Health's amended
and restated short form base shelf prospectus dated November 30,
2018, which was filed in each of the Canadian provinces. After
the completion of the Offering, BELLUS Health has 157,039,686
common shares issued and outstanding.
All currency figures reported in this press
release are in Canadian dollars.
Use of Proceeds
Cash, cash equivalents and short-term
investments on hand as of November 30, 2018 and pro forma to the
Offering total $49.5 million. These funds will be used to finance
research and development activities, including but not limited to,
BLU-5937’s clinical development, general and administrative
expenses, working capital needs and other general corporate
purposes.
Insider Participation
Insiders of the Company, Chairman of Board Dr.
Francesco Bellini, and Directors Mr. Franklin F. Berger and Dr.
Clarissa Desjardins purchased an aggregate of 585,500 common shares
under the Offering or 1.6% of the shares issued under the Offering.
Being insiders of the Company, subscriptions for common shares by
Dr. Bellini, Mr. Berger and Dr. Desjardins are related party
transactions within the meaning of applicable Canadian securities
laws.
The subscriptions by Dr. Bellini, Mr. Berger and
Dr. Desjardins are exempt from the formal valuation and minority
approval requirements applicable to related party transactions on
the basis that the value of the transactions insofar as they
involve related parties is less than 25 percent of the Company's
market capitalization. The Board of Directors of the Company has
approved the Offering and Dr. Bellini, Mr. Berger and Dr.
Desjardins declared their interest and abstained from voting
thereon. A material change report in respect of this related party
transaction could not be filed earlier than 21 days prior to the
closing of the Offering due to the Offering being launched on
December 11, 2018 and the terms of the participation of
certain of the non-related parties and the related parties in the
Offering confirmed shortly before closing.
Agent Commissions
In connection with the Offering, the agents
received a total cash commission of $1,549,970 equal to 4.5% of the
gross proceeds raised in connection with the Offering (excluding
common shares sold to certain excluded subscribers on a direct,
non-brokered basis without any cash fee paid in respect of such
shares). In addition, the agents were issued 1,450,264
non-transferable broker warrants, equal to 4.0% of the number of
common shares issued under the Offering (excluding any common
shares sold to certain excluded subscribers on a direct,
non-brokered basis without any broker warrants issued to the agents
in respect of such shares). Each broker warrant entitles the agents
to buy one common share at a price of $0.95 per share for a
period of eighteen (18) months from the closing of the
Offering.
U.S. Securities Statement
The securities described herein have not been,
and will not be, registered under the U.S. Securities Act, or any
state securities laws, and accordingly, may not be offered or sold
to, or for the account or benefit of, persons in the United
States or to U.S. Persons (as such term is defined in
Regulation S under the U.S. Securities Act), except in compliance
with the registration requirements of the U.S. Securities Act and
applicable state securities requirements or pursuant to exemptions
therefrom. This press release does not constitute an offer to sell
or a solicitation of an offer to buy any of the Company's
securities.
About BELLUS Health
(www.bellushealth.com)
BELLUS Health is a clinical-stage
biopharmaceutical company developing novel therapeutics for
conditions with high unmet medical need. Its pipeline of projects
includes the Company’s lead drug candidate BLU-5937 for chronic
cough and several other partnered clinical-stage drug development
programs. BLU-5937, a highly selective P2X3 antagonist, has the
potential to be a best-in-class therapeutic for chronic cough
patients who do not respond to current therapies.
Chronic cough is a cough that lasts more than
eight weeks and is associated with significant adverse social,
psychosocial and physical effects on quality of life. A commercial
assessment performed by Torreya Insights on behalf of the Company
concluded that, in the United States alone, more than
26 million adults have chronic cough and more than 2.6 million
of these patients suffer from refractory chronic cough lasting for
more than a year.
Forward-Looking Statements
Certain statements contained in this news
release, other than statements of fact that are independently
verifiable at the date hereof, may constitute “forward-looking
statements” within the meaning of Canadian securities legislation
and regulations. In particular, this news release includes
forward-looking information relating to the offering and the
completion and use of net proceeds thereof, our aim to initiate a
clinical Phase 2 study for BLU-5937 in mid-2019 and our aim to
further develop the BLU-5937 program. Such statements, based as
they are on the current expectations of management, inherently
involve numerous important risks, uncertainties and assumptions,
known and unknown, many of which are beyond BELLUS Health Inc.'s
control. Such risks factors include but are not limited to: the
ability to expand and develop its project pipeline, the ability to
obtain financing, the impact of general economic conditions,
general conditions in the pharmaceutical industry, changes in the
regulatory environment in the jurisdictions in which BELLUS Health
Inc. does business, stock market volatility, fluctuations in costs,
changes to the competitive environment due to consolidation,
achievement of forecasted burn rate, potential payments/outcomes in
relation to indemnity agreements and contingent value rights,
achievement of forecasted pre-clinical and clinical trial
milestones and that actual results may vary once the final and
quality-controlled verification of data and analyses has been
completed. In addition, the length of BELLUS Health Inc.’s drug
candidates’ development process, their market size and commercial
value, as well as the sharing of proceeds between BELLUS Health
Inc. and its potential partners from potential future revenues, if
any, are dependent upon a number of factors. Consequently, actual
future results and events may differ materially from the
anticipated results and events expressed in the forward-looking
statements. The Company believes that expectations represented by
forward-looking statements are reasonable, yet there can be no
assurance that such expectations will prove to be correct. The
reader should not place undue reliance, if any, on any
forward-looking statements included in this news release. These
forward-looking statements speak only as of the date made, and
BELLUS Health Inc. is under no obligation and disavows any
intention to update publicly or revise such statements as a result
of any new information, future event, circumstances or otherwise,
unless required by applicable legislation or regulation. Please see
BELLUS Health Inc.’s public filings with the Canadian securities
regulatory authorities, including the Annual Information Form, for
further risk factors that might affect BELLUS Health Inc. and its
business.
FOR MORE INFORMATION, PLEASE CONTACT:François
DesjardinsVice-President, Finance
450-680-4525fdesjardins@bellushealth.com
SOURCE: BELLUS Health Inc.
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