Diffusion Pharmaceuticals Inc. (Nasdaq: DFFN)
(“Diffusion,” the “Company,” “we,” “our” or “us”) today announced
the closing of its previously announced registered direct offering,
priced at-the-market, with certain institutional investors of
6,266,787 shares of the Company’s common stock, at a purchase price
of $0.5585 per share and associated warrant. The Company also
issued 6,266,787 unregistered warrants to the institutional
investors in a concurrent private placement to purchase one share
of common stock for each share of common stock purchased with an
exercise price of $0.4335 per share. The gross proceeds to
Diffusion, before deducting placement agent fees and other offering
expenses, were approximately $3.5 million. The warrants are
exercisable upon issuance and will expire five and one half years
following the date of issuance.
H.C. Wainwright & Co. acted as the exclusive
placement agent for the offerings.
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 (but not the warrants
or the shares of common stock underlying the warrants) 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.
The warrants and shares issuable upon exercise
of the warrants offered in the concurrent private placement have
not been registered under the Securities Act of 1933, as amended,
and may not be offered or sold in the United States absent
registration with the SEC or an applicable exemption from such
registration requirements.
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 bring oxygen to the areas where it is needed
most, offering new hope for the treatment of life-threatening
medical conditions.
Diffusion’s lead drug TSC was originally
developed in conjunction with the Office of Naval Research, which
was seeking a way to treat hemorrhagic shock caused by massive
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 stroke and
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 signals of enhanced survival and patient
performance. Diffusion’s on-ambulance PHAST-TSC trial for acute
stroke has begun patient enrollment. In addition, preclinical data
supports the potential for TSC as a treatment for other conditions
where hypoxia plays a major role, such as myocardial infarction,
respiratory diseases such as COPD, peripheral artery disease, and
neurodegenerative conditions such as Alzheimer’s and Parkinson’s
disease.
Further, 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, the anticipated
timing of future clinical trials, 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: Diffusion’s ability to
maintain its Nasdaq listing, the use of proceeds of the offering,
market conditions, the difficulty of developing pharmaceutical
products, obtaining regulatory and other approvals and achieving
market acceptance; general business and economic conditions; 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.
Investor 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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