Galectin Therapeutics Files Registration Statement for Stockholder Rights Offering of Common Stock and Warrants
March 06 2019 - 8:02AM
Galectin Therapeutics Inc. (NASDAQ: GALT), the leading developer of
therapeutics that target galectin proteins, today filed a
Registration Statement on Form S-3 with the U.S. Securities
and Exchange Commission (“SEC”) (available
at
www.sec.gov) with regards to a planned
Rights Offering of common stock and warrants to its stockholders.
In the Rights Offering the Company will seek to raise between $50
million and $70 million. Richard E. Uihlein, chairman of the board,
has indicated his non-binding intent to purchase $20 million in the
offering.
In the Rights Offering the Company will distribute
to all of its stockholder a non-transferable subscription right to
purchase a unit consisting of 0.3 shares of the Company’s common
stock and a warrant to purchase 0.075 share of the Company’s common
stock (representing 25% warrant coverage) for each share of common
stock they own on the record date. Once the preliminary
Registration Statement is approved by the SEC, the Company will set
the record date and the dates of the commencement and expiration of
the Rights Offering. The record date will be announced several days
in advance of the date. This will allow persons to make open market
purchases of the Company’s common stock in advance of the record
date, thereby becoming eligible to participate in the Rights
Offering. The subscription price for each share of common stock in
the offering and the related warrant will be the lesser of the
initial price to be set by the Company or a percentage to be set by
the Company (estimated to be between 85% and 95%) of the volume
weighted average price of the common stock of the Company on the
expiration date of the Rights Offering. The warrant exercise price,
also to be set by the Company, is expected to be between 25% and
50% higher than the unit price. The warrants will be exercisable
for 7 years.
The Rights Offering also gives each stockholder the
right to over-subscribe, which means that a stockholder purchasing
in the Rights Offering can also purchase units that other
stockholders do not purchase, subject to cut backs if the Rights
Offering, considered as a whole, is over-subscribed. The purpose of
this Rights Offering is to raise equity capital in a cost-effective
manner that also provides all of our existing stockholders the
opportunity to participate. We intend to use the net proceeds from
this offering for general working capital purposes and for a
portion of the cost of our NASH-RX Phase 3 clinical trial
evaluating the efficacy of our drug candidate GR-MD-02 for the
treatment of NASH cirrhosis patients without esophageal
varices.
Richard E. Uihlein, the chairman of the Company’s
board of directors and the beneficial owner of approximately 5.7%
of our outstanding common stock prior to this Rights Offering
(excluding shares issuable upon exercise of options and warrants),
has indicated that he intends to exercise all of his subscription
rights and his oversubscription rights pursuant to this Rights
Offering in the aggregate amount of $20.0 million, but has not made
any formal binding commitment to do so.
Harold H. Shlevin, CEO of the Company stated, “We
are very excited to be embarking on a Phase 3 program GR-MD-02 in
treatment of compensated NASH cirrhotic patients. We look forward
to the continued support of our stockholders in this undertaking.
In particular, Mr. Uihlein has been a staunch supporter of the
Company and continues to tangibly demonstrate his commitment to the
Company. His efforts have been instrumental in helping us advance
our development programs targeted to assisting patients with NASH
cirrhosis”.
Today, the Company has also separately released an
open letter to stockholders written by Richard E. Uihlein.
About Galectin Therapeutics
Galectin Therapeutics is dedicated to developing novel
therapies to improve the lives of patients with chronic liver
disease and cancer. Galectin’s lead drug (GR-MD-02) is a
carbohydrate-based drug that inhibits the galectin-3 protein which
is directly involved in multiple inflammatory, fibrotic, and
malignant diseases. The lead development program is in
non-alcoholic steatohepatitis (NASH) with cirrhosis, the most
advanced form of NASH related fibrosis. This is the most common
liver disease and one of the largest drug development opportunities
available today. Additional development programs are in treatment
of severe atopic dermatitis, moderate-to-severe plaque psoriasis,
and in combination immunotherapy for advanced melanoma and other
malignancies; advancement of these additional clinical programs is
largely dependent on finding a suitable partner. Galectin seeks to
leverage extensive scientific and development expertise as well as
established relationships with external sources to achieve
cost-effective and efficient development. Additional information is
available
at www.galectintherapeutics.com.
Forward Looking Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements relate to future events or
future financial performance, and use words such as “may,”
“estimate,” “could,” “expect”, “intend” and others. They are based
on management’s current expectations and are subject to factors and
uncertainties that could cause actual results to differ materially
from those described in the statements. These statements include
those regarding the hope that Galectin’s development program for
GR-MD-02 will lead to the first therapy for the treatment of fatty
liver disease with cirrhosis and those regarding the hope that our
lead compounds will be successful in the treatment of severe atopic
dermatitis, moderate-to-severe plaque psoriasis and in cancer
immunotherapy and in other therapeutic indications. Factors that
could cause actual performance to differ materially from those
discussed in the forward-looking statements include, among others,
that Galectin may not be successful in developing effective
treatments and/or obtaining the requisite approvals for the use of
GR-MD-02 or any of its other drugs in development; the Company may
not be successful in scaling up manufacturing and meeting
requirements related to chemistry, manufacturing and control
matters; the Company’s current clinical trial and any future
clinical studies may not produce positive results in a timely
fashion, if at all, and could prove time consuming and costly;
plans regarding development, approval and marketing of any of
Galectin’s drugs are subject to change at any time based on the
changing needs of the Company as determined by management and
regulatory agencies; regardless of the results of any of its
development programs, Galectin may be unsuccessful in developing
partnerships with other companies or raising additional capital
that would allow it to further develop and/or fund any studies or
trials. Galectin has incurred operating losses since inception, and
its ability to successfully develop and market drugs may be
impacted by its ability to manage costs and finance continuing
operations. For a discussion of additional factors impacting
Galectin’s business, see the Company’s Annual Report on Form 10-K
for the year ended December 31, 2018, and subsequent filings with
the SEC. You should not place undue reliance on forward-looking
statements. Although subsequent events may cause its views to
change, management disclaims any obligation to update
forward-looking statements.
Contact:Jack Callicutt, Chief Financial
Officer(678) 620-3186ir@galectintherapeutics.com.
Galectin Therapeutics and its associated logo is a
registered trademark of Galectin Therapeutics Inc.
Galectin Therapeutics (NASDAQ:GALT)
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