Filed pursuant to Rule 424(b)(5)
Registration No. 333-248763
PROSPECTUS SUPPLEMENT (TO PROSPECTUS DATED SEPTEMBER 23,
2020)
JAGUAR HEALTH, INC.
4,437,870 Shares of Common Stock
We are offering 4,437,870 shares of our
voting common stock, par value $0.0001 per share (“Common Stock”), pursuant to this prospectus supplement and the accompanying
prospectus and a securities purchase agreement at a price of $3.38 per share.
Our Common Stock is listed on the Nasdaq
Capital Market under the symbol “JAGX.” On January 12, 2021, the last reported sale price of our Common Stock
on the Nasdaq Capital Market was $3.38 per share.
Investing in our Common Stock involves
a high degree of risk. Before deciding whether to invest in our securities, you should consider carefully the risks that we have
described on page S-9 of this prospectus supplement under the caption “Risk Factors” and in the documents incorporated
by reference into this prospectus supplement and the accompanying prospectus.
We have retained Ladenburg Thalmann & Co. Inc.
to act as our exclusive placement agent in connection with this offering. The placement agent has agreed to use its reasonable
best efforts to place the securities offered by this prospectus supplement. We have agreed to pay the placement agent the fee set
forth in the table below. The placement agent is not purchasing or selling any shares offered by this prospectus supplement and
the accompanying base prospectus. See “Plan of Distribution” beginning on page S-19 of this prospectus
supplement for more information regarding these arrangements.
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Per Share
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Total
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Public offering price
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$3.3800
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$15,000,000.60
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Placement agent fees(1)
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$0.2704
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$1,200,000.05
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Proceeds, before expenses
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$3.1096
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$13,800,000.55
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(1)
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We have agreed to pay the placement agent a cash commission fee equal to 8% of the aggregate gross proceeds to us from
the sale of the securities in the offering as reflected in the table above. See “Plan of Distribution” for more
information regarding fees and expenses to be paid to the placement agent.
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Neither the Securities and Exchange Commission
nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement
is truthful or complete. Any representation to the contrary is a criminal offense.
We expect that delivery of the shares of
our Common Stock being offered pursuant to this prospectus supplement and the accompanying prospectus will be made to purchasers
through the facilities of The Depository Trust Company on or about January 15, 2021.
LADENBURG THALMANN
The date of this prospectus supplement is
January 13, 2021
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS SUPPLEMENT
This prospectus supplement and the accompanying
prospectus dated September 23, 2020 are part of a registration statement that we filed with the Securities and Exchange Commission
(the “SEC”) using a “shelf” registration process.
This prospectus supplement and the accompanying
prospectus relate to the offer by us of shares of our Common Stock to certain investors. We provide information to you about this
offering of shares of our Common Stock in two separate documents that are bound together: (1) this prospectus supplement,
which describes the specific details regarding this offering; and (2) the accompanying prospectus, which provides general
information, some of which may not apply to this offering. Generally, when we refer to this “prospectus,” we are referring
to both documents combined. If information in this prospectus supplement is inconsistent with the accompanying prospectus, you
should rely on this prospectus supplement. However, if any statement in one of these documents is inconsistent with a statement
in another document having a later date—for example, a document incorporated by reference in this prospectus supplement or
the accompanying prospectus—the statement in the document having the later date modifies or supersedes the earlier statement
as our business, financial condition, results of operations and prospects may have changed since the earlier dates. You should
not assume that the information contained or incorporated by reference in this prospectus supplement, the accompanying prospectus
or any free-writing prospectus is accurate as of any date other than as of the date of this prospectus supplement, the accompanying
prospectus or any related free-writing prospectus, as the case may be, or in the case of the documents incorporated by reference,
the date of such documents regardless of the time of delivery of this prospectus supplement and the accompanying prospectus or
any sale of our securities. You should read this prospectus supplement, the accompanying prospectus, the documents and information
incorporated by reference in this prospectus supplement and the accompanying prospectus and any free writing prospectus that we
have authorized for use in connection with this offering when making your investment decision. You should also read and consider
the information in the documents to which we have referred you under the captions “Where You Can Find More Information”
and “Incorporation of Information by Reference” in this prospectus supplement. We have not authorized anyone to provide
you with information that is in addition to, or different from, that contained or incorporated by reference in this prospectus
supplement, the accompanying prospectus or in any free writing prospectuses we have prepared. If anyone provides you with different
or inconsistent information, you should not rely on it. We are not offering to sell securities in any jurisdiction where the offer
or sale is not permitted.
Unless the context otherwise requires, references
in this prospectus supplement to “Jaguar,” the “Company,” “we,” “us,” and “our”
refer to Jaguar Health, Inc.
Jaguar Health, our logo, Napo Pharmaceuticals,
Mytesi, Canalevia, Equilevia and Neonorm are our trademarks that are used in this prospectus supplement. This prospectus supplement
also includes trademarks, tradenames and service marks that are the property of other organizations. Solely for convenience, trademarks
and tradenames referred to in this prospectus appear without the ©, ® or ™ symbols, but those references are not
intended to indicate that we will not assert, to the fullest extent under applicable law, our rights or that the applicable owner
will not assert its rights, to these trademarks and tradenames.
PROSPECTUS SUPPLEMENT SUMMARY
The following is a summary of what we
believe to be the most important aspects of our business and the offering of our securities under this prospectus supplement and
in the accompanying prospectus. We urge you to read this entire prospectus supplement, the accompanying prospectus and any free
writing prospectus that we have authorized for use in connection with this offering, including the section entitled “Risk
Factors” and the more detailed financial statements, notes to the financial statements and other information incorporated
by reference from our other filings with the SEC.
Overview
Jaguar is a commercial stage pharmaceuticals
company focused on developing novel, plant-based, non-opioid, and sustainably derived prescription medicines for people and animals
with GI distress, specifically chronic, debilitating diarrhea. Our wholly owned subsidiary, Napo Pharmaceuticals, Inc. (“Napo”),
focuses on developing and commercializing proprietary plant-based human gastrointestinal pharmaceuticals from plants used traditionally
in rainforest areas. Our Mytesi (“crofelemer”) product is approved by the U.S. Food and Drug Administration for the
symptomatic relief of noninfectious diarrhea in adults with HIV/AIDS on antiretroviral therapy and is the only oral plant-based
prescription medicine approved under FDA Botanical Guidance. In the animal health space, we focus on developing and commercializing
first-in-class gastrointestinal products for companion and production animals, foals, and high value horses.
Jaguar was founded in San Francisco, California
as a Delaware corporation on June 6, 2013. Napo formed Jaguar to develop and commercialize animal health products. Effective
as of December 31, 2013, Jaguar was a wholly owned subsidiary of Napo, and Jaguar was a majority-owned subsidiary of Napo
until the close of the Company’s initial public offering on May 18, 2015. On July 31, 2017, the merger of Jaguar
Animal Health, Inc. and Napo became effective, at which point Jaguar Animal Health’s name changed to Jaguar Health, Inc.
and Napo began operating as a wholly-owned subsidiary of Jaguar focused on human health and the ongoing commercialization of, and
development of potential follow-on indications for, Mytesi. Most of the activities of the Company are now focused on the commercialization
of Mytesi and development of follow-on indications for crofelemer and a second-generation anti-secretory product candidate, lechlemer
that has yet to be approved by the FDA. In the field of animal health, we have limited activities which are focused on developing
and commercializing first-in-class gastrointestinal products for dogs, dairy calves, foals, and high value horses.
We believe Jaguar is poised to realize a
number of synergistic, value adding benefits—an expanded pipeline of potential blockbuster human follow-on indications, a
second-generation anti-secretory agent, as well as a pipeline of important animal indications for crofelemer—upon which to
build global partnerships. As previously announced, Jaguar, through Napo, now holds extensive global rights for Mytesi, and crofelemer
manufacturing is being conducted at a multimillion-dollar commercial manufacturing facility that has been FDA-inspected and approved.
Additionally, several of the drug product candidates in Jaguar’s Mytesi pipeline are backed by what we believe are strong
Phase 2 and proof of concept evidence from completed human clinical trials.
Mytesi is a novel, first-in-class anti-secretory
agent which has a basic normalizing effect locally on the gut, and this mechanism of action has the potential to benefit multiple
disorders. Mytesi is in development for multiple possible follow-on indications, including cancer therapy-related diarrhea; an
orphan-drug indication for infants and children with congenital diarrheal disorders; short bowel syndrome (SBS); supportive care
for inflammatory bowel disease (IBD); irritable bowel syndrome (IBS); and for idiopathic/functional diarrhea and is exploring the
possibility of obtaining conditional marketing authorization in Europe to support development of Mytesi for the prophylaxis and/or
symptomatic relief of inflammatory diarrhea. In addition, a second-generation anti-secretory agent, lechlemer, is in development
for cholera. Napo previously received orphan-drug designation for the use of crofelemer in the treatment of SBS.
In October 2020, Napo initiated its
pivotal Phase 3 clinical trial of Mytesi for prophylaxis of diarrhea in adult cancer patients receiving targeted therapy. The Phase
3 pivotal clinical trial is a 24-week (two 12-week stages), randomized, placebo-controlled, double-blind study to evaluate the
safety and efficacy of Mytesi in providing prophylaxis of diarrhea in adult cancer patients with solid tumors receiving targeted
cancer therapy-containing treatment regimens. Mytesi or placebo treatment will start concurrently with the targeted cancer therapy
regimen. The primary endpoint will be assessed at the end of the initial (Stage I) 12-week double-blind placebo-controlled primary
treatment phase. After completing the Stage I treatment phase, the subjects will have the option to remain on their assigned treatment
arm and reconsent to enter into the Stage II 12-week extension phase. The safety and efficacy of orally administered Mytesi will
be evaluated for the prophylaxis of diarrhea in adult cancer patients receiving targeted cancer therapies with or without standard
chemotherapy regimens. The assessment of the frequency of diarrhea will be measured by the number of loose and/or watery stools
for the Stage I treatment period.
In September 2020, Jaguar launched
the Entheogen Therapeutics (ETI) initiative to support the discovery and development of novel, natural medicines derived from psychoactive
plant compounds for treatment of mood disorders, neuro-degenerative diseases, addiction, and other mental health disorders. The
initiative is initially focused on plants with the potential to treat depression and leverages Napo’s proprietary library
of approximately 2,300 plants with medicinal properties. According to statistics available from the National Institute of Mental
Health Disorders, part of the National Institutes of Health, approximately 9.5% of American adults ages 18 and over will suffer
from a depressive illness (major depression, bipolar disorder, or dysthymia) each year. Field research collaborations conducted
in the past by members of the scientific strategy team (SST) of Jaguar’s predecessor company Shaman Pharmaceuticals, who
are also members of the ETI SST, yielded possible applications for a compound called alstonine. Alstonine is derived from a plant
used by traditional healers in Nigeria, and has demonstrated a potential novel mechanism of action for the treatment of difficult
to manage conditions such as schizophrenia.
While Jaguar and Napo remain steadfastly
focused on the commercial success of Mytesi and on the development of potential crofelemer follow-on indications in the area of
gastrointestinal health, the Company believes the same competencies and multi-disciplinary scientific strategy that led to the
development of crofelemer will support collaborative efforts with potential partners to develop novel first-in-class prescription
medicines derived from psychoactive plants.
Our management team has significant experience
in gastrointestinal product development for both humans and animals. Napo was founded 30 years ago to perform drug discovery and
development by leveraging the knowledge of traditional healers working in rainforest areas. Ten members of the Jaguar and Napo
team have been together for more than 15 years. Dr. Steven King, our chief sustainable supply, ethnobotanical research and
intellectual property officer, and Lisa Conte, our founder, president and CEO, have worked together for more than 30 years. Together,
these dedicated personnel successfully transformed crofelemer, which is extracted from trees growing in the rainforest, to Mytesi,
which is a natural, sustainably harvested, FDA-approved drug available from essentially any pharmacy in the United States.
Recent Developments
Secured Debt Issuance
On January 12, 2021, the Company entered
into a binding term sheet (the “Term Sheet”) with Streeterville Capital, LLC (“Investor”), an affiliate
of Chicago Venture Partners, L.P. (“CVP”), pursuant to which the Company agreed to issue Investor a secured promissory
note (the “Note”) in the aggregate principal amount of $6 million (the “Note Offering”). The Note will
bear interest at prime per annum and will be prepaid each 12 months at the beginning of the period. The Company will use the proceeds
for the development of SB-300 (lechlemer) and other general corporate purposes, including the company’s product pipeline
activities. The Note will mature 48 months after the issue date and will be secured by a first priority security interest in all
existing and future lechlemer technology. While the Note is outstanding, Investor will be entitled to receive 18% of the gross
proceeds from the sale of partial rights to a possible tropical disease priority review voucher (“TDPRV”) (to the extent
that a TDPRV is granted to the Company by the U.S. Food & Drug Administration (“FDA”) in connection with the
Company’s development of lechlemer for the symptomatic relief of diarrhea from cholera), which proceeds will decrease to
1% in perpetuity once the Note is paid in full.
In addition, beginning on the earlier of
(i) six months following the closing of the Note Offering and (ii) the initiation of human clinical trials with lechlemer,
(the “Optional Prepayment Period”), the Company will have the right, from time to time at in its sole discretion, to
prepay all or any portion of the Note (such amount, the “Principal Prepayment Amount”) at a price equal to 112.5% multiplied
by the Principal Prepayment Amount (the “Optional Prepayment Amount”). If the Company meets all primary endpoints in
the pivotal trial(s) with statistical significance, the Company must receive Investor approval before prepaying the Note.
In the event that, prior to redeeming the
Note, the Company abandons the clinical trial with lechlemer for an indication for the symptomatic relief of diarrhea from cholera
(such event, which is deemed to cover (i) failure to start the Phase 1 clinical trial by July 1, 2022 and (ii) failure
to meet all primary endpoints in the pivotal trial with statistical significance, “Trial Default”), then, at Investor’s
sole election, the Company will immediately pay to Investor an amount equal to 125% multiplied by all outstanding principal and
accrued and unpaid interest on the Note as of the date of the Trial Default. The final terms of the Note Offering are subject to
the negotiation and finalization of the definitive agreement relating to the Note Offering, and the material terms of the Note
Offering may differ from those set forth in the Term Sheet.
Exchange Transactions
Preferred Stock
Between October 1, 2020 and December 28,
2020, the Company entered into privately negotiated exchange agreements with Iliad Research and Trading, L.P. (“Iliad”),
the holder of 842,500 shares of the Series C Preferred Stock (the “Series C Preferred Shares”) and (ii) 842,500
shares (the “Series D Preferred Shares” and, together with the Series C Preferred Shares, the “Preferred
Shares”) of our Series D Perpetual Preferred Stock, par value $0.0001 per share (the “Series D Preferred
Stock”), pursuant to which the Company issued 24,343,751 shares of Common Stock and pre-funded warrants to purchase 7,057,692
shares of Common Stock in the aggregate at an effective price per share equal to the market price (defined as the Minimum Price
under Nasdaq Listing Rule 5635(d)) in exchange for 1,718,158 Preferred Shares (collectively, the “Preferred Exchange
Transactions”). As a result of the Preferred Exchange Transactions, no Series C Preferred Shares or Series D Preferred
Shares remain outstanding.
On December 23, 2020, the Company issued
1,246,210 shares of Common Stock upon conversion of 6,559 shares of Series B-2 Preferred Stock with a conversion price of
$190.00 per share. As a result, no Series B-2 Preferred Stock remain outstanding as of January 11, 2021.
CVP Notes
Between October 1, 2020 and January 4,
2021, the Company entered into privately negotiated exchange agreements with CVP, the holder of the Company’s secured promissory
notes, dated May 28, 2019 (the “CVP Notes”), pursuant to which we issued 18,123,426 shares of Common Stock in
the aggregate at an effective price per share equal to the market price (defined as the Minimum Price under Nasdaq Listing Rule 5635(d))
in exchange for a $6,291,619 reduction in the outstanding balance of the CVP Notes (collectively, the “Note Exchange Transactions”).
As a result of the Note Exchange Transactions, as of January 4, 2021, the CVP Notes have been repaid in full and are no longer
outstanding.
Nasdaq Compliance
On December 30, 2019, the Company received
a letter from the Listing Qualifications Staff (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”)
indicating that the closing bid price for Common Stock for the last 30 consecutive business days was below the $1.00 per share
minimum required for continued listing under Nasdaq Listing Rule 5550(a)(2) (the “Rule”). The Company had
a 180 calendar day grace period to regain compliance with the minimum bid price requirement. The minimum bid price requirement
will be met if the Common Stock has a minimum closing bid price of at least $1.00 per share for a minimum of 10 consecutive business
days during the 180-calendar day grace period.
On April 16, 2020, Nasdaq announced
it was providing relief from the minimum bid price requirement through June 30, 2020. Under the relief, the Company’s
grace period to regain compliance with the minimum bid was tolled until July 1, 2020. As such, the Company’s grace period
was effectively extended until September 10, 2020.
On September 11, 2020, the Company
received written notice from the Staff indicating that, based upon the Company’s continued non-compliance with the minimum
bid price requirement for continued listing on The Nasdaq Capital Market as set forth in the Rule, as of September 11, 2020,
and notwithstanding the Company’s compliance with the quantitative criteria necessary to obtain a second 180-day period within
which to evidence compliance with the Rule, as set forth in Nasdaq Listing Rule 5810(c)(3)(A), the Staff had determined
to delist the Company’s securities from Nasdaq unless the Company timely request a hearing before the Nasdaq Hearings Panel
(the “Panel”).
The Company made a timely request for a
hearing before the Panel. The hearing was held on October 22, 2020. On October 28, 2020, the Company received formal
notice that the Panel granted the Company an extension through December 23, 2020 to evidence compliance with the minimum bid
price requirement under the Rule.
On December 2, 2020, the Company received
an unsolicited letter (the “Letter”) from the Office of Appeals and Review of Nasdaq staying the stipulation for the
Company to comply with the minimum bid price requirement by December 23, 2020 set forth in the October 28, 2020 decision
of the Panel. The Letter indicated that the Nasdaq Listing and Hearing Review Council (the “Listing Council”) had exercised
its discretion to call for review the October 28, 2020 decision of the Panel. By its decision, the Panel granted the Company
an extension to remedy the bid price deficiency, but only through December 23, 2020. Pursuant to the Nasdaq Listing Rules,
the Panel had the discretion to grant the Company an extension through March 10, 2021.
The Listing Council stated that it will
consider whether the Panel should have granted the Company a longer period to regain compliance with the bid price requirement
and that, during the pendency of the Listing Council’s review, the terms of the Panel’s October 28, 2020 decision
had been stayed.
Risks Related to Our Business
Our business, and our ability to execute
our business strategy, is subject to a number of risks as more fully described in the section titled “Risk Factors.”
These risks include, among others, the following:
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We have a limited operating history, expect to continue to incur significant research and development and other expenses, and may never become profitable. Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern.
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Our failure to meet the continued listing requirements of The Nasdaq Capital Market could result in a delisting of our Common Stock. Nasdaq has determined to delist our securities from Nasdaq pending a hearing before the Nasdaq Hearings Panel.
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We are substantially dependent on the success of our current lead human prescription drug product, Mytesi and Canalevia, our prescription drug product candidate for dogs with chemotherapy induced diarrhea (CID) and exercise-induced diarrhea (EID), and cannot be certain that necessary approvals will be received for planned Mytesi follow-on indications or Canalevia or that these product candidates will be successfully commercialized, either by us or any of our partners.
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The results of earlier studies may not be predictive of the results of our pivotal trials or other future studies, and we may be unable to obtain any necessary regulatory approvals for our existing or future prescription drug product candidates under applicable regulatory requirements.
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Development of prescription drug products, and, to a lesser extent, non-prescription products, for the human health and animal health market is inherently expensive, time-consuming and uncertain, and any delay or discontinuance of our current or future pivotal trials, or dosage or formulation studies, would harm our business and prospects.
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Even if we obtain any required regulatory approvals for our current or future prescription drug product candidates, they may never achieve market acceptance or commercial success.
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We are dependent upon imported active pharmaceutical ingredients and contract manufacturers for supplies of our current prescription drug product candidates and non-prescription products and intend to rely on contract manufacturers for commercial quantities of any of our commercialized products.
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If we are not successful in identifying, developing and commercializing additional prescription drug product candidates and non-prescription products, our ability to expand our business and achieve our strategic objectives may be impaired.
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We have material weaknesses in our internal control over financial reporting related to staff turnover in our accounting department and our financial statement preparation and review process. We did not maintain a sufficient complement of internal personnel with appropriate knowledge, experience and/or training commensurate with our financial reporting requirements, and we did not have adequate policies and procedures in place to ensure the timely and effective preparation and review of the financial statements. If we fail to remediate the material weaknesses, or experience any additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to accurately report our financial condition or results of operations which may adversely affect investor confidence in us and, as a result, the value of our Common Stock.
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Corporate Information
We were incorporated in the State of Delaware
on June 6, 2013. Our principal executive offices are located at 200 Pine Street, Suite 400, San Francisco, CA 94014 and
our telephone number is (415) 371-8300. Our website address is https://jaguar.health. The information contained on, or that
can be accessed through, our website is not part of this prospectus supplement. Our Common Stock is listed on the Nasdaq Capital
Market and trades under the symbol “JAGX.”
On June 3, 2019, we filed an amendment
to our Third Amended and Restated Certificate of Incorporation to effect on June 7, 2019, a 1-for-70 reverse split of our
Common Stock. Accordingly, all of the stock figures and related market, conversion and exercise prices in this prospectus supplement
have been adjusted to reflect the reverse split.
THE OFFERING
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Common stock offered by us
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4,437,870 shares of our Common Stock
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Public offering price
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$3.38 per share.
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Common stock outstanding prior to this offering
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117,818,021 shares
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Common stock to be outstanding after this offering
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122,255,891 shares
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Use of proceeds
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We intend to use net proceeds from this offering for working capital and other general corporate purposes. See “Use of Proceeds” on page S-17.
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Risk factors
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You should read the “Risk Factors” section of this prospectus supplement and in the documents incorporated by reference in this prospectus supplement for a discussion of factors to consider before deciding to invest in our securities.
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Nasdaq Capital Market symbol
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“JAGX”.
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We have two classes of common stock: (i) voting
common stock, par value $0.0001 per share, and (ii) non-voting common stock, par value $0.0001 per share. The shares offered
by us in this offering are voting common stock.
The
number of shares of our common stock to be outstanding after this offering is based on 117,816,001 shares of our
voting common stock and 2,020 shares of our non-voting common stock outstanding as of January 11, 2021, and excludes the
following:
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4,825,427 shares of common stock issuable upon exercise of warrants outstanding as of January 11, 2021 with a weighted-average exercise price of $1.03;
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4,456,822 shares of common stock issuable upon exercise of outstanding options as of January 11, 2021 with a weighted-average exercise price of $4.33;
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220,381 shares of common stock remain available for grant under the 2014 Stock Incentive Plan and 378,182 shares of common stock have been issued under the 2020 Employee Inducement Plan;
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121,818 shares of common stock issuable upon exercise of outstanding inducement options as of January 11, 2021, with a weighted-average exercise price of $0.51; and
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5,613 shares of voting common stock issuable upon vesting of outstanding restricted stock unit awards (“RSUs”), as of January 11, 2021.
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RISK FACTORS
Investing in our Common Stock involves a
high degree of risk. You should carefully consider the risks factor described below. You should also consider the risks, uncertainties
and assumptions discussed under the heading “Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” included in our most recent Annual Report on Form 10-K, as revised or
supplemented by our most recent Quarterly Report on Form 10-Q, each of which are on file with the SEC and are incorporated
herein by reference, and which may be amended, supplemented or superseded from time to time by other reports we file with the SEC
in the future. There may be other unknown or unpredictable economic, business, competitive, regulatory or other factors that could
have material adverse effects on our future results. If any of these risks actually occurs, our business, business prospects, financial
condition or results of operations could be seriously harmed. In such an event, the market price of our Common Stock could decline,
and you may lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently
deem immaterial also may harm our business, financial condition, results of operations and prospects.
Risks Related to Our Common Stock
Our failure to meet the continued listing requirements
of The Nasdaq Capital Market could result in a delisting of our Common Stock.
Our Common Stock is listed on The Nasdaq
Capital Market, which imposes, among other requirements, a minimum bid price requirement. On December 30, 2019, we received
a letter from Nasdaq indicating that we failed to comply with Nasdaq’s minimum bid price for continued listing set forth
in Nasdaq Listing Rule 5110(a)(2). On September 11, 2020, we received written notice from the Staff indicating that,
based upon our continued non-compliance with the minimum bid price requirement, the Staff has determined to delist our securities
from The Nasdaq Capital Market unless we timely request a hearing before a Nasdaq hearings panel.
The Company made a timely request for a
hearing before the Panel. The hearing was held on October 22, 2020. On October 28, 2020, the Company received formal
notice that the Panel granted the Company an extension through December 23, 2020 to evidence compliance with the minimum bid
price requirement under the Rule. On December 2, 2020, the Company received an unsolicited letter from the Office of Appeals
and Review of Nasdaq staying the stipulation for the Company to comply with the minimum bid price requirement by December 23,
2020 set forth in the October 28, 2020 decision of the Panel, which stay will continue until the Nasdaq Listing and Hearing
Review Council (the “Listing Council”) has completed its review of the October 28, 2020 decision of the Panel.
We are diligently working to evidence compliance
with the minimum bid price requirement for continued listing on Nasdaq; however, there can be no assurance that we will be able
to regain compliance with the minimum bid price requirement or maintain compliance with the other continued listing requirements,
or that Nasdaq will grant us a further extension of time to regain compliance, if necessary.
If we fail to maintain compliance with the
minimum bid price requirement or any other of the continued listing requirements of The Nasdaq Capital Market, Nasdaq may take
steps to delist our Common Stock. The delisting of our Common Stock from Nasdaq may make it more difficult for us to raise capital
on favorable terms in the future. Such a delisting would likely have a negative effect on the price of our Common Stock and would
impair your ability to sell or purchase our Common Stock when you wish to do so. Further, if we were to be delisted from The Nasdaq
Capital Market, our Common Stock would cease to be recognized as covered securities and we would be subject to regulation in each
state in which it offers its securities. Moreover, there is no assurance that any actions that we take to restore our compliance
with the Nasdaq minimum bid price requirement would stabilize the market price or improve the liquidity of our Common Stock, prevent
our Common Stock from falling below the Nasdaq minimum bid price required for continued listing again or prevent future non-compliance
with Nasdaq’s listing requirements.
We have material weaknesses in our internal control
over financial reporting related to staff turnover in our accounting department and our financial statement preparation and
review process. We did not maintain a sufficient complement of internal personnel with appropriate knowledge, experience
and/or training commensurate with our financial reporting requirements, and we did not have adequate policies and procedures
in place to ensure the timely and effective preparation and review of the financial statements. If we fail to remediate the
material weaknesses, or experience any additional material weaknesses in the future or otherwise fail to maintain an
effective system of internal controls in the future, we may not be able to accurately report our financial condition or
results of operations which may adversely affect investor confidence in us and, as a result, the value of our Common
Stock.
Our management is responsible for establishing
and maintaining adequate internal control over our financial reporting, as defined in Rule 13a-15(f) under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”).
Preparing our consolidated financial statements
involves a number of complex manual and automated processes, which are dependent upon individual data input or review and require
significant management judgment. One or more of these elements may result in errors that may not be detected and could result in
a material misstatement of our consolidated financial statements. If we fail to maintain the adequacy of our internal controls
over financial reporting, our business and operating results may be harmed and we may fail to meet our financial reporting obligations.
If material weaknesses in our internal control are discovered or occur, our consolidated financial statements may contain material
misstatements and we could be required to restate our financial results.
In connection with our preparation of our
annual financial statements for the year ended December 31, 2019 and 2018 and for the nine months ended September 30,
2020, we identified material weaknesses in our internal control over financial reporting related to staff turnover in our accounting
department and our financial statement preparation and review process. We did not maintain a sufficient complement of internal
personnel with appropriate knowledge, experience and/or training commensurate with our financial reporting requirements and we
did not have adequate policies and procedures in place to ensure the timely and effective preparation and review of the financial
statements. We relied on outside consulting technical experts and did not maintain adequate internal qualified personnel to properly
supervise and review the information provided by the outside consulting technical experts to ensure certain significant complex
transactions and technical matters were properly accounted for, specifically with respect to assumptions used in measuring the
value of certain financial instruments and contractual covenants in certain financial instruments on the balance sheet at December 31,
2019, and accurately reflecting all potential accrued services on the balance sheet at December 31, 2019. We have concluded
that we must implement and have begun implementing new or improved controls in our financial statement close process and policies
in reviewing information received from our outside consulting technical experts and will continue evaluating ways to improve our
controls and policies.
We have enhanced our internal controls,
processes and related documentation in our efforts to address our material weaknesses. We may not be able to complete our remediation,
evaluation and testing in a timely fashion. If we are unable to remediate these material weaknesses, or if we identify one or more
other material weaknesses in our internal control over financial reporting, we will continue to be unable to conclude that our
internal controls are effective. If we are unable to confirm that our internal control over financial reporting is effective we
could lose investor confidence in the accuracy and completeness of our financial reports, which could cause the price of our Common
Stock to decline.
If our shares become subject to the penny stock rules,
it would become more difficult to trade our shares.
The SEC has adopted rules that regulate
broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price
of less than $5.00, other than securities registered on certain national securities exchanges or authorized for quotation on certain
automated quotation systems, provided that current price and volume information with respect to transactions in such securities
is provided by the exchange or system. If we do not retain a listing on The Nasdaq Capital Market and if the price of our Common
Stock is less than $5.00, our Common Stock will be deemed a penny stock. The penny stock rules require a broker-dealer, before
a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing
specified information. In addition, the penny stock rules require that before effecting any transaction in a penny stock not
otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable
investment for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure
statement; (ii) a written agreement to transactions involving penny stocks and (iii) a signed and dated copy of a written
suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market
for our Common Stock, and therefore stockholders may have difficulty selling their shares.
The price of our Common Stock could be subject to volatility
related or unrelated to our operations, and purchasers of our Common Stock could incur substantial losses.
The trading price of our Common Stock could
be subject to wide fluctuations in response to various factors, some of which are beyond our control. These factors include those
discussed previously in this “Risk Factors” section of this prospectus supplement and the risks, uncertainties and
assumptions discussed under the heading “Risk Factors” included in our most recent Annual Report on Form 10-K,
as revised or supplemented by our most recent Quarterly Report on Form 10-Q, and others, such as:
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delays in the commercialization of Mytesi, Neonorm, Canalevia, Equilevia or our other current or future prescription drug product candidates and non-prescription products;
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any delays in, or suspension or failure of, our current and future studies;
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announcements of regulatory approval or disapproval of any of our current or future product candidates or of regulatory actions affecting our company or our industry;
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manufacturing and supply issues that affect product candidate or product supply for our studies or commercialization efforts;
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quarterly variations in our results of operations or those of our competitors;
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changes in our earnings estimates or recommendations by securities analysts;
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the payment of licensing fees or royalties in shares of our Common Stock;
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announcements by us or our competitors of new prescription drug products or product candidates or non-prescription products, significant contracts, commercial relationships, acquisitions or capital commitments;
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announcements relating to future development or license agreements including termination of such agreements;
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adverse developments with respect to our intellectual property rights or those of our principal collaborators;
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commencement of litigation involving us or our competitors;
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any major changes in our board of directors or management;
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new legislation in the United States relating to the prescription, sale, distribution or pricing of gastrointestinal health products;
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product liability claims, other litigation or public concern about the safety of our prescription drug product or product candidates and non-prescription products or any such future products;
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market conditions in the human or animal health industry, in general, or in the gastrointestinal health sector, in particular, including performance of our competitors;
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uncertainties related to COVID-19; and
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general economic conditions in the United States and abroad.
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In addition, the stock market, in general,
or the market for stocks in our industry, in particular, may experience broad market fluctuations, which may adversely affect the
market price or liquidity of our Common Stock. Any sudden decline in the market price of our Common Stock could trigger securities
class-action lawsuits against us. If any of our stockholders were to bring such a lawsuit against us, we could incur substantial
costs defending the lawsuit and the time and attention of our management would be diverted from our business and operations. We
also could be subject to damages claims if we were found to be at fault in connection with a decline in our stock price.
You may not be able to resell our Common Stock when you
wish to sell them or at a price that you consider attractive or satisfactory.
The listing of our Common Stock on The Nasdaq
Capital Market does not assure that a meaningful, consistent and liquid trading market exists. Although our Common Stock is listed
on The Nasdaq Capital Market, trading volume in our Common Stock has been limited and an active trading market for our shares may
never develop or be sustained. If an active market for our Common Stock does not develop, you may be unable to sell your shares
when you wish to sell them or at a price that you consider attractive or satisfactory. The lack of an active market may also adversely
affect our ability to raise capital by selling securities in the future, or impair our ability to license or acquire other product
candidates, businesses or technologies using our shares as consideration.
If securities or industry analysts do not publish research
or reports about our company, or if they issue adverse or misleading opinions regarding us or our stock, our stock price and trading
volume could decline.
The trading market for our Common Stock
depends in part on the research and reports that industry or financial analysts publish about us or our business. We do not influence
or control the reporting of these analysts. If one or more of the analysts who do cover us downgrade or provide a negative outlook
on our company or our industry, or the stock of any of our competitors, the price of our Common Stock could decline. If one or
more of these analysts ceases coverage of our company, we could lose visibility in the market, which in turn could cause the price
of our Common Stock to decline.
You may be diluted by conversions of outstanding shares
of non-voting common stock and exercises of outstanding options and warrants.
As of January 11, 2021, we had (i) outstanding
options to purchase an aggregate of 4,456,822 shares of our Common Stock at a weighted average exercise price of $4.33 per share,
(ii) outstanding options to purchase an aggregate of 121,818 shares of our Common Stock issuable upon exercise of outstanding
inducement options as of January 11, 2021, with a weighted-average exercise price of $0.51 per share, (iii) 4,825,427
shares of Common Stock issuable upon exercise of warrants outstanding as of January 11, 2021, with a weighted-average exercise
price of $1.03, and (v) 5,613 shares of Common Stock issuable upon vesting of outstanding RSUs.
The exercise of such options and warrants
and conversion of the non-voting common stock will result in further dilution of your investment. In addition, you may experience
further dilution if we issue Common Stock in the future. As a result of this dilution, you may receive significantly less in net
tangible book value than the full purchase price you paid for the shares in the event of liquidation.
The sale of our Common Stock under the ATM Agreement may
cause substantial dilution to our stockholders, and such sales, or the anticipation of such sales, may cause the price of our Common
Stock to decline.
In
October 2020, we entered into an At the Market Offering Agreement (“ATM Agreement”) with Ladenburg Thalmann &
Co. Inc. (“Ladenburg”), pursuant to which we may offer and sell, from time to time through Ladenburg, shares
(the “Shares”) of Common Stock, subject to the terms and conditions of the ATM Agreement. We have the right to control
whether we sell any shares, if at all, under the ATM Agreement, and we generally have the right to control the amount and minimum
price at which we conduct sales under the ATM Agreement. To the extent we do sell shares of our Common Stock under the ATM Agreement,
such sales may result in substantial dilution to our existing stockholders, and such sales, or the anticipation of such sales,
may cause the trading price of our Common Stock to decline.
Provisions in our charter documents and under Delaware
law could discourage a takeover that stockholders may consider favorable and may lead to entrenchment of management.
Our third amended and restated certificate
of incorporation and amended and restated bylaws contain provisions that could delay or prevent changes in control or changes in
our management without the consent of our board of directors. These provisions to include the following:
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a classified board of directors with three-year staggered terms, which may delay the ability of stockholders to change the membership of a majority of our board of directors;
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no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;
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the exclusive right of our board of directors to elect a director to fill a vacancy created by the expansion of the board of directors or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors;
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the ability of our board of directors to authorize the issuance of shares of preferred stock and to determine the terms of those shares, including preferences and voting rights, without stockholder approval, which could adversely affect the rights of our common stockholders or be used to deter a possible acquisition of our company;
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the ability of our board of directors to alter our bylaws without obtaining stockholder approval;
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the required approval of the holders of at least 75% of the shares entitled to vote at an election of directors to adopt, amend or repeal our bylaws or repeal the provisions of our third amended and restated certificate of incorporation regarding the election and removal of directors;
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a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders;
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the requirement that a special meeting of stockholders may be called only by the chairman of the board of directors, the chief executive officer, the president or the board of directors, which may delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors; and
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advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of us.
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These provisions could inhibit or prevent
possible transactions that some stockholders may consider attractive.
We are also subject to the anti-takeover
provisions contained in Section 203 of the Delaware General Corporation Law. Under Section 203, a corporation generally
may not engage in a business combination with any holder of 15% or more of its capital stock unless the holder has held the stock
for three years or, among other exceptions, the board of directors has approved the transaction.
Our amended and restated bylaws designate the Court of
Chancery of the State of Delaware as the sole and exclusive forum for certain actions and proceedings that may be initiated by
our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or
our directors, officers or other employees.
Our amended and restated bylaws provide
that, unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware will be the sole and
exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim
of breach of a fiduciary duty owed by any director, officer or other employees to us or our stockholders, (iii) any action
asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, (iv) any action asserting a claim
that is governed by the internal affairs doctrine or (v) any action to interpret, apply, enforce or determine the validity
of our certificate of incorporation or bylaws. Any person purchasing or otherwise acquiring any interest in any shares of our capital
stock shall be deemed to have notice of and to have consented to this provision of our amended and restated bylaws. This choice-of-forum
provision may limit our stockholders’ ability to bring a claim in a judicial forum that they find favorable for disputes
with us or our directors, officers or other employees, which may discourage such lawsuits. Alternatively, if a court were to find
this provision of our amended and restated bylaws inapplicable or unenforceable with respect to one or more of the specified types
of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could
harm our business and financial condition.
We do not intend to pay dividends on our Common Stock,
and your ability to achieve a return on your investment will depend on appreciation in the market price of our Common Stock.
We currently intend to invest our future
earnings, if any, to fund our growth and not to pay any cash dividends on our Common Stock. Moreover, so long as Nantucket Investments
Limited (“Nantucket”) or any of its affiliates owns any shares of our non-voting common stock, we cannot pay dividends
on our voting common stock or non-voting common stock without obtaining the prior written consent of Nantucket. Because we do not
intend to pay dividends and may be required to obtain written consent if we were to do so, your ability to receive a return on
your investment will depend on any future appreciation in the market price of our Common Stock. We cannot be certain that our Common
Stock will appreciate in price.
The requirements of being a public company, including
compliance with the reporting requirements of the Exchange Act and the requirements of the Sarbanes-Oxley Act, may strain our resources,
increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective
manner.
Our initial public offering had a significant,
transformative effect on us. Prior to our initial public offering, our business operated as a privately-held company, and we were
not required to comply with public reporting, corporate governance and financial accounting practices and policies required of
a publicly-traded company. As a publicly-traded company, we incur significant additional legal, accounting and other expenses compared
to historical levels. In addition, new and changing laws, regulations and standards relating to corporate governance and public
disclosure, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations thereunder,
as well as under the Sarbanes-Oxley Act, the JOBS Act and the rules and regulations of the SEC and The Nasdaq Capital Market,
may result in an increase in our costs and the time that our board of directors and management must devote to our compliance with
these rules and regulations. These rules and regulations have substantially increased our legal and financial compliance
costs and diverted management time and attention from our product development and other business activities.
The Sarbanes-Oxley Act requires, among other
things, that we assess the effectiveness of our internal control over financial reporting annually and the effectiveness of our
disclosure controls and procedures quarterly. In particular, Section 404 of the Sarbanes-Oxley Act (“Section 404”),
requires us to perform system and process evaluation and testing of our internal control over financial reporting to allow management
to report on, and our independent registered public accounting firm potentially to attest to, the effectiveness of our internal
control over financial reporting. We have needed to expend time and resources on documenting our internal control over financial
reporting so that we are in a position to perform such evaluation when required. As a “smaller reporting company,”
we expect to avail ourselves of the exemption from the requirement that our independent registered public accounting firm attest
to the effectiveness of our internal control over financial reporting under Section 404. However, we may no longer avail ourselves
of this exemption when we cease to be a “smaller reporting company.” When our independent registered public accounting
firm is required to undertake an assessment of our internal control over financial reporting, the cost of our compliance with Section 404
will correspondingly increase. Our compliance with applicable provisions of Section 404 requires that we incur substantial
accounting expense and expend significant management time on compliance-related issues as we implement additional corporate governance
practices and comply with reporting requirements. Moreover, if we are not able to comply with the requirements of Section 404
applicable to us in a timely manner, or if we or our independent registered public accounting firm identifies deficiencies in our
internal control over financial reporting that are deemed to be material weaknesses, the market price of our stock could decline
and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional
financial and management resources.
Issuances of shares of Common Stock or securities convertible
into or exercisable for shares of Common Stock following this offering, as well as the exercise of options and warrants outstanding,
will dilute your ownership interests and may adversely affect the future market price of our Common Stock.
The issuance of additional shares of our
Common Stock or securities convertible into or exchangeable for our Common Stock could be dilutive to stockholders if they do not
invest in future offerings. We intend to use the net proceeds from this offering to continue to fund the development of our business
and for general corporate purposes, which may include capital expenditures and funding our working capital needs. We may seek additional
capital through a combination of private and public equity offerings, debt financings, strategic partnerships and alliances and
licensing arrangements, which may cause your ownership interest to be diluted.
In addition, we have a significant number
of options and warrants to purchase shares of our Common Stock outstanding. If these securities are exercised or converted, you
may incur further dilution. Moreover, to the extent that we issue additional options or warrants to purchase, or securities convertible
into or exchangeable for, shares of our Common Stock in the future and those options, warrants or other securities are exercised,
converted or exchanged, stockholders may experience further dilution.
We have effectuated two reverse stock splits since January 1,
2018 and have received stockholder approval for a third reverse stock split, which if effectuated, may not achieve one or more
of our objectives.
We have effectuated two reverse stock splits
since January 1, 2018 and have received stockholder approval authorizing our board of directors to effectuate a reverse stock
split at a ratio not less than 1-for-2 and not greater than 1-for 20, with the exact ratio, if approved and effected at all, to
be set within that range at the discretion of our board of directors and publicly announced by us on or before December 9,
2021. While we currently have no intentions to effectuate a reverse stock split, we may do so in the future for various reasons,
including to increase the per share market price of our Common Stock to the extent required to remain in compliance with the Nasdaq
minimum bid price requirement.
If we were to effectuate a reverse stock
split, there can be no assurance that the market price per share of our Common Stock after a reverse stock split will remain unchanged
or increase in proportion to the reduction in the number of shares of our Common Stock outstanding before the reverse stock split.
The market price of our shares may fluctuate and potentially decline after a reverse stock split. Accordingly, the total market
capitalization of our Common Stock after a reverse stock split may be lower than the total market capitalization before the reverse
stock split. Moreover, the market price of our Common Stock following a reverse stock split may not exceed or remain higher than
the market price prior to the reverse stock split.
Additionally, there can be no assurance
that a reverse stock split will result in a per-share market price that will attract institutional investors or investment funds
or that such share price will satisfy investing guidelines of institutional investors or investment funds. As a result, the trading
liquidity of our Common Stock may not necessarily improve. Further, if a reverse stock split is effected and the market price of
our Common Stock declines, the percentage decline may be greater than would occur in the absence of a reverse stock split.
Risks Related to this Offering
Management will have broad discretion
as to the use of the net proceeds from this offering, and may not use the proceeds effectively.
We currently anticipate that the net
proceeds from this offering will be used for working capital and general corporate purposes. Our management has broad discretion
over how these proceeds are used and could spend the proceeds in ways with which you may not agree, and the proceeds may not be
invested in a manner that yields a favorable or any return.
As a new investor, you will incur
substantial dilution as a result of this offering and future equity issuances, and as a result, our share price could decline.
The offering price of our Common Stock
will be substantially higher than the net tangible book value per share of our outstanding Common Stock. As a result, based on
our pro forma capitalization as of September 30, 2020, investors purchasing Common Stock in this offering will incur immediate
and substantial dilution of $3.29 per share. In addition to this offering, subject to market conditions and other factors, we could
pursue raising additional funds in the future, as we continue to build our business. Accordingly, we may conduct substantial future
offerings of equity or debt securities. The exercise of outstanding options and warrants and future equity issuances, including
issuances of Common Stock pursuant to the ATM Agreement, future public offerings or future private placements of equity securities
and any additional shares issued in connection with acquisitions, will also result in dilution to investors. In addition, the market
price of our Common Stock could fall as a result of resales of any of these shares of Common Stock due to an increased number of
shares available for sale in the market.
CAUTIONARY NOTE REGARDING
FORWARD-LOOKING STATEMENTS
This prospectus supplement and the documents
incorporated by reference into it contain forward-looking statements within the meaning of Section 27A of the Securities Act,
and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have made these statements
in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements
of historical facts contained in or incorporated by reference into this prospectus supplement, including statements regarding our
future results of operations and financial position, business strategy, prospective products, product approvals, research and development
costs, timing of receipt of clinical trial, field study and other study data, and likelihood of success, commercialization plans
and timing, other plans and objectives of management for future operations, and future results of current and anticipated products
are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that
may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements.
In some cases, you can identify forward-looking
statements by terms such as “may,” “will,” “should,” “expect,” “plan,”
“aim,” “anticipate,” “could,” “intend,” “target,” “project,”
“contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue”
or the negative of these terms or other similar expressions. The forward-looking statements in this prospectus supplement are only
predictions. We have based these forward-looking statements largely on our current expectations and projections about future events
and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking
statements speak only as of the date of this prospectus supplement and are subject to a number of risks, uncertainties and assumptions
including those listed in the “Risk Factors” incorporated by reference into this prospectus supplement from our Annual
Report on Form 10-K, as updated by subsequent reports. Forward-looking statements are subject to inherent risks and uncertainties,
some of which cannot be predicted or quantified and some of which are beyond our control. The events and circumstances reflected
in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected
in the forward-looking statements. Moreover, we operate in a dynamic industry and economy. New risk factors and uncertainties may
emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties that we may face.
Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein,
whether as a result of any new information, future events, changed circumstances or otherwise.
USE OF PROCEEDS
We estimate that we will receive net proceeds
of approximately $13.5 million, after deducting the estimated placement agent fees and before deducting offering costs payable
by us. We intend to use the net proceeds from this offering for general corporate and working capital purposes.
As of the date of this prospectus supplement,
we cannot specify with certainty all of the particular uses of the proceeds from this offering. As a result, our management will
have broad discretion in the allocation and use of the net proceeds from this offering, and investors will be relying on the judgment
of our management regarding the application of the proceeds of this offering. The actual use and allocation of proceeds realized
from this offering will depend upon our operating revenues and cash position and our working capital requirements and may change.
We may also invest the net proceeds temporarily in a variety of capital preservation investments, including short-term, investment-grade,
interest-bearing instruments and U.S. government securities, until we use them for their stated purposes.
DILUTION
If you purchase shares in this offering,
your interest will be diluted to the extent of the difference between the public offering price per share of Common Stock and the
as adjusted net tangible book value per share of our Common Stock after this offering.
Our net tangible book value as of September 30,
2020 was approximately ($17.0) million, or ($0.35) per share of Common Stock (based upon 48,901,352 outstanding shares of Common
Stock). “Net tangible book value” is total assets minus the sum of liabilities and intangible assets. “Net tangible
book value per share” is net tangible book value divided by the total number of shares of common stock outstanding.
Our pro forma net tangible book value as
of September 30, 2020 would have been approximately $(4.2) million, or ($0.04) per share of Common Stock (based upon 102,241,146
outstanding shares of Common Stock), after giving effect to (i) the issuance of 3,814,925 shares of Common Stock through Ladenburg
pursuant to the ATM Agreement, (ii) the issuance of 18,123,426 shares of Common Stock in the Note Exchange Transactions and
(iii) the issuance of 24,343,751 shares of Common Stock and pre-funded warrants to purchase 7,057,692 shares of Common Stock
in the Preferred Exchange Transactions.
After giving effect to (i) the pro
forma adjustments described above and (ii) the sale by us in this offering of 4,437,870 shares for gross proceeds of $15.0
million, and after deducting estimated offering expenses of approximately $1.5 million payable by us, our pro forma as adjusted
net tangible book value as of September 30, 2020 would have been $9.2 million, or $0.09 per share of Common Stock. This represents
an immediate increase in pro forma as adjusted net tangible book value of $0.13 per share to our existing shareholders and an immediate
dilution in pro forma as adjusted net tangible book value of approximately $3.29 per share to investors participating in this offering.
Dilution per share to new investors is determined
by subtracting pro forma as adjusted net tangible book value per share after this offering from the public offering price per share
paid by new investors. The following table illustrates this dilution:
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Public offering price per share
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|
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$
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3.38
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|
Historical net tangible book value per share as of September 30, 2020
|
|
$
|
(0.35
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)
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Pro forma increase in net tangible book value per share attributable to the pro forma transactions described above
|
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$
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0.31
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Pro forma net tangible book value per share as of September 30, 2020
|
|
$
|
(0.04
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)
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|
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Increase in net tangible book value per share attributable to this offering
|
|
$
|
0.13
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|
|
|
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Pro forma as adjusted net tangible book value per share after this offering.
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|
|
|
|
$
|
0.09
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Dilution per share to new investors in this offering
|
|
|
|
|
$
|
3.29
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The information in the table above is based
on 102,241,146 shares of Common Stock outstanding on September 30, 2020 on a pro forma basis, and excludes shares of Common
Stock issuable upon exercise of options, warrants and other rights outstanding on September 30, 2020 on a pro forma basis.
Plan
of Distribution
Ladenburg Thalmann & Co. Inc.,
which we refer to herein as the placement agent, has agreed to act as our exclusive placement agent in connection with this offering
subject to the terms and conditions of the placement agent agreement dated January 13, 2021. The placement agent is not purchasing
or selling any of the shares of our Common Stock offered by this prospectus supplement, nor is it required to arrange the purchase
or sale of any specific number or dollar amount of shares of our Common Stock, but has agreed to use its reasonable best efforts
to arrange for the sale of all of the shares of our Common Stock offered hereby. Therefore, we will enter into a securities purchase
agreement directly with investors in connection with this offering and we may not sell the entire amount of shares of our Common
Stock offered pursuant to this prospectus supplement. We will make offers only to a limited number of qualified institutional buyers
and institutional accredited investors.
We have agreed to indemnify the placement
agent against specified liabilities, including liabilities under the Securities Act, and to contribute to payments the placement
agent may be required to make in respect thereof.
Fees and Expenses
We have agreed to pay the placement agent
a cash commission fee equal to 8% of the aggregate gross proceeds to us from the sale of the securities in the offering.
The following table shows the per share
and total cash placement agent’s fees we will pay to the placement agent in connection with the sale of the shares of our
Common Stock offered pursuant to this prospectus supplement and the accompanying prospectus, assuming the purchase of all of the
shares offered hereby. The table above assumes an 8% fee on all sales.
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Per Share
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Total
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|
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Public offering price
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$
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3.3800
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|
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$
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15,000,000.60
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Placement agent fees
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$
|
0.2704
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$
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1,200,000.05
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Proceeds, before expenses, to us
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$
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3.1096
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$
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13,800,000.55
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In addition, we have agreed to pay the placement
agent a management fee equal to 1% of the aggregate gross proceeds to us from the sale of the securities in the offering. We have
also agreed to reimburse the placement agent’s actual out-of-pocket expenses up to $75,000 and legal expenses of investors
of up to $35,000. We estimate that the total expenses of the offering payable by us, excluding the placement agent fees, will be
approximately $160,000.
The placement agent may be deemed to be
an underwriter within the meaning of Section 2(a)(11) of the Securities Act, and any commissions received by it and any profit
realized on the resale of the shares sold by it while acting as principal might be deemed to be underwriting discounts or commissions
under the Securities Act. As an underwriter, the placement agent would be required to comply with the requirements of the Securities
Act and the Exchange Act, including, without limitation, Rule 415(a)(4) under the Securities Act and Rule 10b-5
and Regulation M under the Exchange Act. These rules and regulations may limit the timing of purchases and sales of shares
by the placement agent acting as principal. Under these rules and regulations, the placement agent:
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may not engage in any stabilization activity in connection with our securities; and
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may not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities, other
than as permitted under the Exchange Act, until it has completed its participation in the distribution.
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Other Relationships
From time to time,
the placement agent may provide in the future, various advisory, investment and commercial banking and other services to us in
the ordinary course of business, for which it may receive customary fees and commissions. However, except as disclosed in this
prospectus, and except for the placement agent’s service as our sales agent under our At the Market Offering Agreement, we
have no present arrangements with the placement agent for any services.
Indemnification
We have agreed to indemnify the placement
agent against certain liabilities, including liabilities under the Securities Act, or to contribute to payments that the placement
agent or such other indemnified parties may be required to make in respect of those liabilities.
Electronic Distribution
This prospectus supplement and the accompanying
prospectus may be made available in electronic format on websites or through other online services maintained by the placement
agent or by an affiliate. Other than this prospectus supplement and the accompanying prospectus, the information on the placement
agent’s website and any information contained in any other website maintained by the placement agent is not part of this
prospectus supplement and the accompanying prospectus or the registration statement of which this prospectus supplement and the
accompanying prospectus form a part, has not been approved and/or endorsed by us or the placement agent, and should not be
relied upon by investors.
Listing
Our shares are listed on the Nasdaq Capital
Market under the symbol “JAGX.”
Transfer Agent and Registrar
The transfer agent and registrar for our
Common Stock is American Stock Transfer & Trust LLC.
LEGAL MATTERS
The validity of the securities offered hereby
will be passed upon by our counsel, Reed Smith LLP, Palo Alto, California.
EXPERTS
The financial statements of the Company
as of December 31, 2019 and for the fiscal year ended December 31, 2019 incorporated by reference in this prospectus
and the registration statement have been so incorporated in reliance on the report of Mayer Hoffman McCann P.C., an independent
registered public accounting firm (the report on the financial statements contains an explanatory paragraph regarding the Company’s
ability to continue as a going concern), incorporated herein by reference, given on the authority of said firm as experts in auditing
and accounting.
The financial statements of the Company
as of December 31, 2018 and for the fiscal year ended December 31, 2018 incorporated by reference in this prospectus
and the registration statement have been so incorporated in reliance on the report of BDO USA, LLP, an independent registered public
accounting firm (the report on the financial statements contains an explanatory paragraph regarding the Company’s ability
to continue as a going concern), incorporated herein by reference, given on the authority of said firm as experts in auditing and
accounting.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the reporting requirements
of the Securities Exchange Act of 1934, as amended, and file annual, quarterly and current reports, proxy statements and other
information with the SEC. These reports, proxy statements and other information are available at the SEC’s web site at http://www.sec.gov.
This prospectus supplement is only part
of a registration statement on Form S-3 that we have filed with the SEC under the Securities Act and therefore omits certain
information contained in the registration statement. We have also filed exhibits and schedules with the registration statement
that are excluded from this prospectus supplement, and you should refer to the applicable exhibit or schedule for a complete description
of any statement referring to any contract or other document. The registration statement, including the exhibits and schedules,
is available at the SEC’s web site at http://www.sec.gov.
We also maintain a website at https://jaguar.health,
through which you can access our SEC filings. The information set forth on, or accessible from, our website is not part of this
prospectus supplement or the accompanying prospectus.
INCORPORATION OF INFORMATION BY REFERENCE
The SEC allows us to “incorporate
by reference” information that we file with them. Incorporation by reference allows us to disclose important information
to you by referring you to those other documents. The information incorporated by reference is an important part of this prospectus
supplement, and information that we file later with the SEC will automatically update and supersede this information. This prospectus
supplement omits certain information contained in the registration statement, as permitted by the SEC. You should refer to the
registration statement, including the exhibits, for further information about us and the securities we may offer pursuant to this
prospectus supplement. Statements in this prospectus supplement or the accompanying prospectus regarding the provisions of certain
documents filed with, or incorporated by reference in, the registration statement are not necessarily complete and each statement
is qualified in all respects by that reference. Copies of all or any part of the registration statement, including the documents
incorporated by reference or the exhibits, may be obtained upon payment of the prescribed rates at the offices of the SEC listed
above in “Where You Can Find More Information.” The documents we are incorporating by reference are:
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our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020 filed on May 15, 2020, our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2020 filed on August 13, 2020 and our fiscal quarter ended September 30, 2020 filed on November 16, 2020;
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Our Current Reports on Form 8-K filed on January 27, 2020, February 27, 2020, February 28, 2020, March 6, 2020, March 23, 2020, March 26, 2020, April 3, 2020, April 6, 2020, April 10, 2020 (as subsequently amended on Form 8-K/A on May 13, 2020), April 16, 2020, May 8, 2020, May 12, 2020, May 18, 2020, May 21, 2020, May 22, 2020, May 28, 2020, June 19, 2020, June 26, 2020, July 14, 2020, July 21, 2020, August 21, 2020, September 2, 2020, September 2, 2020, September 9, 2020, September 11, 2020, September 28, 2020 (as subsequently amended on Form 8-K/A on October 9, 2020), October 5, 2020, October 7, 2020, October 9, 2020, October 29, 2020, November 20, 2020 (as subsequently amended on November 27, 2020 and December 4, 2020), November 25, 2020, November 30, 2020, December 4, 2020, December 10, 2020, December 18, 2020, December 29, 2020, January 8, 2021 and January 14, 2021;
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all reports and other documents subsequently filed by us pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this prospectus supplement and prior to the termination or completion of the offering of securities under this prospectus supplement shall be deemed to be incorporated by reference in this prospectus supplement and to be a part hereof from the date of filing such reports and other documents.
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Unless otherwise noted, the SEC file number
for each of the documents listed above is 001-36714.
In addition, all reports and other documents
filed by us pursuant to the Exchange Act after the date of this prospectus supplement shall be deemed to be incorporated by reference
into this prospectus supplement.
Any statement contained in this prospectus
supplement, the accompanying prospectus, or in a document incorporated or deemed to be incorporated by reference into this prospectus
supplement or the accompanying prospectus will be deemed to be modified or superseded for purposes of this prospectus supplement
to the extent that a statement contained in this prospectus supplement, the accompanying prospectus, or any other subsequently
filed document that is deemed to be incorporated by reference into this prospectus supplement modifies or supersedes the statement.
Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus
supplement or accompanying prospectus.
You may request, orally or in writing, a
copy of any or all of the documents incorporated herein by reference. These documents will be provided to you at no cost, by contacting:
Investor Relations, Jaguar Health, Inc., 200 Pine Street, Suite 400, San Francisco, CA, 94104 or call (415) 371-8300.
You should rely only on information contained
in, or incorporated by reference into, this prospectus supplement and the accompanying prospectus. We have not authorized anyone
to provide you with information different from that contained in this prospectus supplement and the accompanying prospectus. We
are not making offers to sell the securities in any jurisdiction in which such an offer or solicitation is not authorized or in
which the person making such offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make such offer
or solicitation.
JAGUAR HEALTH, INC.
$40,000,000
Common Stock
Preferred Stock
Warrants
Subscription Rights
Units
This prospectus relates to common stock,
preferred stock, warrants and subscription rights that we may sell from time to time in one or more offerings up to a total public
offering price of $40,000,000 on terms to be determined at the time of sale, which securities may be sold either individually or
in units consisting of two or more of the foregoing classes of securities.
Each time we sell securities hereunder,
we will provide specific terms of these securities in supplements to this prospectus. You should read this prospectus and any supplement
carefully before you invest. This prospectus may not be used to offer and sell securities unless accompanied by a prospectus supplement
for those securities.
These securities may be offered and sold
in the same offering or in separate offerings, directly to purchasers, through dealers or agents designated from time to time,
to or through underwriters or through a combination of these methods. See “Plan of Distribution” in this prospectus.
We may also describe the plan of distribution for any particular offering of these securities in any applicable prospectus supplement.
If any agents, underwriters or dealers are involved in the sale of any securities in respect of which this prospectus is being
delivered, we will disclose their names and the nature of our arrangements with them in a prospectus supplement. The net proceeds
we expect to receive from any sale of securities offered by us will also be included in a prospectus supplement.
Our voting common stock is listed on The
Nasdaq Capital Market, under the symbol “JAGX.” On September 10, 2020, the last reported sale price of our voting
common stock on The Nasdaq Capital Market was $0.38 per share.
As of September 1, 2020, the aggregate
market value of the voting and non-voting common equity held by non-affiliates was approximately $35,155,613, which was calculated
based on 43,944,516 shares of outstanding common stock held by non-affiliates and a closing price per share of $0.80 on August 10,
2020. Pursuant to General Instruction I.B.6 of Form S-3, in no event will we sell securities in a public primary offering
with a value exceeding more than one-third of our public float in any 12-month period so long as our public float remains below
$75.0 million. During the 12 calendar months prior to and including the date of this prospectus, we have offered and
sold $1.8 million of securities pursuant to General Instruction I.B.6 of Form S-3. As a result, we are currently eligible
to offer and sell up to an aggregate of approximately $9.9 million of our securities pursuant to General Instruction I.B.6.
of Form S-3.
Investing
in our common stock involves a high degree of risk. Before deciding whether to invest in our securities, you should consider carefully
the risks that we have described on page 4 of this prospectus under the caption “Risk Factors” and
in the documents incorporated by reference into this prospectus.
Neither the Securities and Exchange
Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus
is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is September 23,
2020.
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
This prospectus is part of a registration
statement that we have filed with the Securities and Exchange Commission (the “SEC”) using a “shelf” registration
process. Under this shelf process, we may sell any combination of the securities described in this prospectus in one or more offerings
up to a total public offering price of $40,000,000.
This prospectus provides you with a general
description of the securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will contain
specific information about the securities being offered and the terms of that offering. The prospectus supplement may also add
to, update or change information contained in this prospectus.
We have not authorized any dealer, salesman
or other person to give any information or to make any representation other than those contained or incorporated by reference in
this prospectus. You must not rely upon any information or representation not contained or incorporated by reference in this prospectus.
This prospectus does not constitute an offer to sell or the solicitation of an offer to buy any of our securities other than the
securities covered hereby, nor does this prospectus constitute an offer to sell or the solicitation of an offer to buy any securities
in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. Persons who come
into possession of this prospectus in jurisdictions outside the United States are required to inform themselves about, and to observe,
any restrictions as to the offering and the distribution of this prospectus applicable to those jurisdictions.
We further note that the representations,
warranties and covenants made in any agreement that is filed as an exhibit to any document that is incorporated by reference in
the accompanying prospectus were made solely for the benefit of the parties to such agreement, including, in some cases, for the
purpose of allocating risk among the parties to such agreements, and should not be deemed to be a representation, warranty or covenant
to you. Moreover, such representations, warranties or covenants were accurate only as of the date when made. Accordingly, such
representations, warranties and covenants should not be relied on as accurately representing the current state of our affairs.
You should not assume that the information
contained in this prospectus is accurate on any date subsequent to the date set forth on the front cover of this prospectus or
that any information we have incorporated by reference is correct on any date subsequent to the date of the document incorporated
by reference, even though this prospectus is delivered or securities are sold or otherwise disposed of on a later date. It is important
for you to read and consider all information contained in this prospectus, including the Information Incorporated by Reference
herein, and any prospectus supplement in making your investment decision. You should also read and consider the information in
the documents to which we have referred you under the captions “Where You Can Find More Information” and “Incorporation
of Information by Reference” in this prospectus.
Unless the context otherwise requires,
references in this prospectus to “Jaguar,” the “Company,” “we,” “us,” and “our”
refer to Jaguar Health, Inc.
PROSPECTUS SUMMARY
The following is a summary of what we
believe to be the most important aspects of our business and the offering of our securities under this prospectus. We urge you
to read this entire prospectus, including the more detailed financial statements, notes to the financial statements and other information
incorporated by reference from our other filings with the SEC. Each of the risk factors could adversely affect our business, operating
results and financial condition, as well as adversely affect the value of an investment in our securities.
Overview
Jaguar is a commercial stage pharmaceuticals
company focused on developing novel, plant-based, non-opioid, and sustainably derived prescription medicines for people and animals
with GI distress, specifically chronic, debilitating diarrhea. Our wholly-owned subsidiary, Napo Pharmaceuticals, Inc. (“Napo”),
focuses on developing and commercializing proprietary plant-based human gastrointestinal pharmaceuticals from plants used traditionally
in rainforest areas. Our Mytesi (“crofelemer”) product is approved by the U.S. Food and Drug Administration for the
symptomatic relief of noninfectious diarrhea in adults with HIV/AIDS on antiretroviral therapy and is the only oral plant-based
prescription medicine approved under FDA Botanical Guidance. In the animal health space, we focus on developing and commercializing
first-in-class gastrointestinal products for companion and production animals, foals, and high value horses.
Jaguar was founded in San Francisco, California
as a Delaware corporation on June 6, 2013. Napo formed Jaguar to develop and commercialize animal health products. Effective
as of December 31, 2013, Jaguar was a wholly-owned subsidiary of Napo, and Jaguar was a majority-owned subsidiary of Napo
until the close of the Company’s initial public offering on May 18, 2015. On July 31, 2017, the merger of Jaguar
Animal Health, Inc. and Napo became effective, at which point Jaguar Animal Health’s name changed to Jaguar Health, Inc.
and Napo began operating as a wholly-owned subsidiary of Jaguar focused on human health and the ongoing commercialization of, and
development of follow-on indications for, Mytesi. Most of the activities of the Company are now focused on the commercialization
of Mytesi and development of follow-on indications for crofelemer and a second-generation anti-secretory product, lechlemer. In
the field of animal health, we have limited activities which are focused on developing and commercializing first-in-class gastrointestinal
products for dogs, dairy calves, foals, and high value horses.
We believe Jaguar is poised to realize
a number of synergistic, value adding benefits — an expanded pipeline of potential blockbuster human follow-on
indications, a second-generation anti-secretory agent, as well as a pipeline of important animal indications for crofelemer — upon
which to build global partnerships. As previously announced, Jaguar, through Napo, now holds extensive global rights for Mytesi,
and crofelemer manufacturing is being conducted at a multimillion-dollar commercial manufacturing facility that has been FDA-inspected
and approved. Additionally, several of the drug product candidates in Jaguar’s Mytesi pipeline are backed by what we believe
are strong Phase 2 and proof of concept evidence from completed human clinical trials.
Mytesi is a novel, first-in-class anti-secretory
agent which has a basic normalizing effect locally on the gut, and this mechanism of action has the potential to benefit multiple
disorders. Mytesi is in development for multiple possible follow-on indications, including cancer therapy-related diarrhea; orphan-drug
indications for infants and children with congenital diarrheal disorders and short bowel syndrome (SBS); supportive care for inflammatory
bowel disease (IBD); irritable bowel syndrome (IBS); and for idiopathic/functional diarrhea. In addition, a second-generation anti-secretory
agent, lechlemer, is in development for cholera. Mytesi previously received orphan-drug designation for SBS.
In September 2020, Jaguar launched
the Entheogen Therapeutics initiative to support the discovery and development of novel, natural medicines derived from psychoactive
plant compounds for treatment of mood disorders, neuro-degenerative diseases, addiction, and other mental health disorders. The
initiative will initially focus on plants with the potential to treat depression and will leverage Napo’s proprietary library
of approximately 2,300 plants with medicinal properties. According to statistics available from the National Institute of Mental
Health Disorders, part of the National Institutes of Health, approximately 9.5% of American adults ages 18 and over will suffer
from a depressive illness (major depression, bipolar disorder, or dysthymia) each year.
While Jaguar and Napo remain steadfastly
focused on the commercial success of Mytesi and on the development of potential crofelemer follow-on indications in the area of
gastrointestinal health, the Company believes the same competencies and multi-disciplinary scientific strategy that led to the
development of crofelemer will support collaborative efforts with potential partners to develop novel first-in-class prescription
medicines derived from psychoactive plants.
Our management team has significant experience
in gastrointestinal product development for both humans and animals. Napo was founded 30 years ago to perform drug discovery
and development by leveraging the knowledge of traditional healers working in rainforest areas. Ten members of the Jaguar and Napo
team have been together for more than 15 years. Dr. Steven King, our chief sustainable supply, ethnobotanical research
and intellectual property officer, and Lisa Conte, our founder, president and CEO, have worked together for more than 30 years.
Together, these dedicated personnel successfully transformed crofelemer, which is extracted from trees growing in the rainforest,
to Mytesi, which is a natural, sustainably harvested, FDA-approved drug available from essentially any pharmacy in the United States.
Corporate Information
We were incorporated in the State of Delaware
on June 6, 2013. Our principal executive offices are located at 201 Mission Street, Suite 2375, San Francisco, CA 94015
and our telephone number is (415) 371-8300. Our website address is https://jaguar.health. The information contained on, or that
can be accessed through, our website is not part of this prospectus. Our common stock is listed on The Nasdaq Capital Market and
trades under the symbol “JAGX.”
On June 3, 2019, we filed an amendment
to our Third Amended and Restated Certificate of Incorporation to effect on June 7, 2019, a 1-for-70 reverse split of our
voting common stock. Accordingly, all of the stock figures and related market, conversion and exercise prices in this prospectus
have been adjusted to reflect the reverse split.
Jaguar
Health, our logo, Napo Pharmaceuticals, Mytesi, Canalevia, Equilevia and Neonorm are our trademarks that are used in this prospectus.
This prospectus also includes trademarks, tradenames and service marks that are the property of other organizations. Solely for
convenience, trademarks and tradenames referred to in this prospectus appear without the ©,
® or ™ symbols, but those references are not intended to indicate that we will
not assert, to the fullest extent under applicable law, our rights or that the applicable owner will not assert its rights, to
these trademarks and tradenames.
The Offering
This prospectus relates to the offer by
us of up to $40,000,000 of common stock, preferred stock, warrants, subscription rights or units in one or more offerings
and in any combination.
RISK FACTORS
Please carefully consider the risk factors
described under the heading “Risk Factors” contained in the applicable prospectus supplement and any related free writing
prospectus, and under similar headings in our periodic reports filed with the SEC, which are incorporated by reference in this
prospectus. Before making an investment decision, you should carefully consider these risks as well as other information we include
or incorporate by reference in this prospectus. Additional risks and uncertainties not presently known to us or that we deem currently
immaterial may also impair our business operations or adversely affect our results of operations or financial condition.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This prospectus and any accompanying prospectus
supplement, including the documents incorporated by reference into this prospectus and any accompanying prospectus supplement,
contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities
Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have
made these statements in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements
other than statements of historical facts contained in or incorporated by reference into this prospectus, including statements
regarding our future results of operations and financial position, business strategy, prospective products, product approvals,
research and development costs, timing of receipt of clinical trial, field study and other study data, and likelihood of success,
commercialization plans and timing, other plans and objectives of management for future operations, and future results of current
and anticipated products are forward-looking statements. These statements involve known and unknown risks, uncertainties and other
important factors that may cause our actual results, performance or achievements to be materially different from any future results,
performance or achievements expressed or implied by the forward-looking statements.
In some cases, you can identify forward-looking
statements by terms such as “may,” “will,” “should,” “expect,” “plan,”
“aim,” “anticipate,” “could,” “intend,” “target,” “project,”
“contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue”
or the negative of these terms or other similar expressions. The forward-looking statements in this prospectus are only predictions.
We have based these forward-looking statements largely on our current expectations and projections about future events and financial
trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements
speak only as of the date of this prospectus and are subject to a number of risks, uncertainties and assumptions including those
listed in the “Risk Factors” incorporated by reference into this prospectus from our Annual Report on Form 10-K,
as updated by subsequent reports. Forward-looking statements are subject to inherent risks and uncertainties, some of which cannot
be predicted or quantified and some of which are beyond our control. The events and circumstances reflected in our forward-looking
statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking
statements. Moreover, we operate in a dynamic industry and economy. New risk factors and uncertainties may emerge from time to
time, and it is not possible for management to predict all risk factors and uncertainties that we may face. Except as required
by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result
of any new information, future events, changed circumstances or otherwise.
USE OF PROCEEDS
We currently intend to use the estimated
net proceeds from the sale of the securities offered by us for working capital and other general corporate purposes, and possibly
acquisitions of other companies, products or technologies. Working capital and other general corporate purposes may include research
and development expenditures, capital expenditures, operating and administrative expenditures, and any other purpose that we may
specify in any prospectus supplement. While we have no current plans for any specific acquisitions at this time, we believe opportunities
may exist from time to time to expand our current business through strategic alliances or acquisitions with other companies, products
or technologies. We have not yet determined the amount of net proceeds to be used specifically for any of the foregoing purposes.
Accordingly, our management will have significant discretion and flexibility in applying the net proceeds from the sale of the
securities offered by us. Pending any use, as described above, we intend to invest the net proceeds in high-quality, short-term,
interest-bearing securities. Our plans to use the estimated net proceeds from the sale of the securities offered by us may change,
and if they do, we will update this information in a prospectus supplement.
DESCRIPTION OF CAPITAL STOCK
General
The following description summarizes the
most important terms of our capital stock. Because it is only a summary of the provisions of our Third Amended and Restated Certificate
of Incorporation, as amended (the “Certificate of Incorporation”), and amended and restated bylaws, it does not contain
all of the information that may be important to you. For a complete description of the matters set forth in this “Description
of Capital Stock,” you should refer to our Certificate of Incorporation and our amended and restated bylaws, each of which
are included as exhibits to the registration statement of which this prospectus is a part, and to the applicable provisions of
Delaware law. Our authorized capital stock consists of 204,475,074 shares of capital stock, which consists of (i) 150,000,000
shares of voting common stock, $0.0001 par value per share, (ii) 50,000,000 shares of convertible non-voting common stock,
$0.0001 par value per share, and (iii) 4,475,074 shares of preferred stock, $0.0001 par value per share.
Common Stock
We have two classes of common stock: voting
common stock and non-voting common stock. Holders of both classes of our common stock are entitled to receive ratably any dividends
declared by our board of directors out of funds legally available for that purpose, subject to any preferential dividend rights
of any outstanding preferred stock or that we may designate or issue in the future. In the event of our liquidation, dissolution
or winding up, the holders of both classes of our common stock are entitled to share ratably in all assets remaining after the
payment of liabilities, subject to the prior distribution rights of preferred stock then outstanding. There are no preemptive,
conversion or subscription rights applicable to either class of common stock. There are no redemption or sinking fund provisions
applicable to either class of common stock. The rights, preferences, and privileges of the holders of both classes of common stock
are subject to and may be adversely affected by, the rights of the holders of shares of any series of preferred stock that we may
designate in the future. All of our outstanding shares of voting common stock and non-voting common stock are, and the shares of
common stock to be issued pursuant to this offering, when paid for, will be fully paid and nonassessable.
Voting Common Stock
The holders of our voting common stock
are entitled to one vote for each share held on all matters submitted to a vote of the stockholders.
Non-Voting Common Stock
The holders of our non-voting common stock
do not have any cumulative voting rights and are not entitled to vote, except on an as-converted basis with respect to any Change
of Control (as defined in the Certificate of Incorporation). Shares of non-voting common stock are convertible into shares of voting
common stock on a 1,050-for-one basis (i) upon transfers to non-affiliates of Nantucket Investments Limited (“Nantucket”)
and (ii) at any time at the option of the respective holders thereof.
Quotation on The Nasdaq Capital Market
Our voting common stock is quoted on The Nasdaq Capital Market
under the symbol “JAGX”.
Transfer Agent
The
transfer agent of our common stock is American Stock Transfer & Trust Company, LLC. Their address is 6201 15th
Avenue, Brooklyn, New York, 11219.
Preferred Stock
Under our Certificate of Incorporation,
our board of directors is authorized to issue up to 4,475,074 shares of preferred stock from time to time, in one or more classes
or series, without stockholder approval. As of the date of this prospectus, we have 7,534 shares of Series B-2 Convertible
Preferred Stock (“Series B-2 Preferred Stock”) outstanding, 842,500 shares of Series C Perpetual Preferred
Stock (“Series C Preferred Stock”) and 842,500 shares of Series D Perpetual Preferred Stock (“Series D
Preferred Stock”) outstanding.
Prior to the issuance of shares of each
class or series, our board of directors is required by the Delaware General Corporation Law (“DGCL”) and our Certificate
of Incorporation to adopt resolutions and file a certificate of designation with the Delaware Secretary of State. The certificate
of designation fixes for each class or series the designations, powers, preferences, rights, qualifications, limitations and restrictions
of that class or series, including the following:
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the number of shares constituting each class or series;
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rights and terms of redemption, including sinking fund provisions;
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dividend rights and rates;
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terms concerning the distribution of assets;
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conversion or exchange terms;
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liquidation preferences.
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All shares of preferred stock offered,
when issued and paid for, will be validly issued, fully paid and nonassessable and will not have any preemptive or subscription
rights.
We will specify the following terms relating to any class or
series of preferred stock offered by us:
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the title and stated value of the preferred stock;
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the number of shares of the preferred stock offered, the liquidation preference per share and the offering price of the preferred
stock;
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the dividend rate(s), period(s) or payment date(s) or method(s) of calculation applicable to the preferred stock;
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whether dividends are cumulative or non-cumulative and, if cumulative, the date from which dividends on the preferred stock
will accumulate;
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our right, if any, to defer payment of dividends and the maximum length of any such deferral period;
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the procedures for auction and remarketing, if any, for the preferred stock;
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the provisions for a sinking fund, if any, for the preferred stock;
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the provision for redemption, if applicable, of the preferred stock;
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any listing of the preferred stock on any securities exchange;
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the terms and conditions, if applicable, upon which the preferred stock will be convertible into common stock, including the
conversion price or manner of calculation and conversion period;
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voting rights, if any, of the preferred stock;
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whether interests in the preferred stock will be represented by depositary shares;
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a discussion of any material or special United States federal income tax considerations applicable to the preferred stock;
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the relative ranking and preferences of the preferred stock as to dividend rights and rights upon the liquidation, dissolution
or winding up of our affairs;
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any limitations on issuance of any class or series of preferred stock ranking senior to or on a parity with the class or series
of preferred stock as to dividend rights and rights upon the liquidation, dissolution or winding up of our affairs; and
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any other specific terms, preferences, rights, limitations or restrictions of the preferred stock.
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Anti-Takeover Effects of Delaware Law and Our Certificate
of Incorporation and Bylaws
Delaware Law
Certain provisions of Delaware law and
our Certificate of Incorporation and amended and restated bylaws contain provisions that could have the effect of delaying, deferring
or discouraging another party from acquiring control of us. These provisions, which are summarized below, are expected to discourage
certain types of coercive takeover practices and inadequate takeover bids. These provisions are also designed in part to encourage
anyone seeking to acquire control of us to negotiate with our board of directors. We believe that the advantages gained by protecting
our ability to negotiate with any unsolicited and potentially unfriendly acquirer outweigh the disadvantages of discouraging such
proposals, including those priced above the then-current market value of our common stock, because, among other reasons, the negotiation
of such proposals could improve their terms.
Third Amended and Restated Certificate of Incorporation
and Amended and Restated Bylaws
Our Certificate of Incorporation and amended and restated bylaws
include provisions that:
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require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written
consent;
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specify that special meetings of our stockholders can be called only by our board of directors, the chairman of our board of
directors, the chief executive officer or the president;
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establish an advance notice procedure for stockholder approvals to be brought before an annual meeting of our stockholders,
including proposed nominations of persons for election to our board of directors;
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provide that directors may be removed only for cause;
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provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though
less than a quorum;
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establish that our board of directors is divided into three classes, Class I, Class II and Class III, with each
class serving staggered terms;
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specify that no stockholder is permitted to cumulate votes at any election of our board of directors; and
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require approval of the stockholders of at least 75% of the shares and a majority of the board of directors to amend certain
of the above-mentioned provisions.
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Exclusive Jurisdiction
Under the provisions of our Certificate
of Incorporation and amended and restated bylaws, unless we consent in writing to the selection of an alternative forum, the Court
of Chancery of the State of Delaware will be the sole and exclusive forum for: (i) any derivative action or proceeding brought
on behalf of us; (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or
other employees or agents to us or our stockholders; (iii) any action asserting a claim against us arising pursuant to any
provision of the Delaware General Corporation Law or our Certificate of Incorporation or amended and restated bylaws; (iv) any
action to interpret, apply, enforce or determine the validity of our Certificate of Incorporation or amended and restated bylaws;
or (v) any action asserting a claim against us governed by the internal affairs doctrine; provided that, if and only if the
Court of Chancery of the State of Delaware does not have subject matter jurisdiction, then any such action may be brought in another
state or federal court sitting in the State of Delaware. This exclusive forum provision would not apply to suits brought to enforce
any liability or duty created by the Securities Act or the Exchange Act or any other claim for which the federal courts have exclusive
jurisdiction. To the extent that any such claims may be based upon federal law claims, Section 27 of the Exchange Act creates
exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and
regulations thereunder. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state
courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations
thereunder. The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has
been challenged in legal proceedings, and it is possible that, in connection with any action, a court could find the choice of
forum provisions contained in our Certificate of Incorporation or amended and restated bylaws to be inapplicable or unenforceable
in such action. Our amended and restated bylaws provide that if any part of the exclusive forum provision is held to be invalid,
illegal or unenforceable, as applied to any person or entity or circumstance for any reason whatsoever, then, to the fullest extent
permitted by law, the validity, legality and enforceability of such part in any other circumstance and of the remaining parts of
the exclusive forum provision and the application of such provision to other persons or entities and circumstances will not in
any way be affected or impaired thereby.
Delaware Anti-Takeover Statute
We are subject to the provisions of Section 203
of the Delaware General Corporation Law regulating corporate takeovers. In general, Section 203 prohibits a publicly-held
Delaware corporation from engaging, under certain circumstances, in a business combination with an interested stockholder for a
period of three years following the date the person became an interested stockholder unless:
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prior to the date of the transaction, the board of directors of the corporation approved either the business combination or
the transaction which resulted in the stockholder becoming an interested stockholder;
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upon the closing of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder
owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes
of determining the voting stock outstanding, but not for determining the outstanding voting stock owned by the interested stockholder,
(1) shares owned by persons who are directors and also officers, and (2) shares owned by employee stock plans in which
employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered
in a tender or exchange offer; or
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at or subsequent to the date of the transaction, the business combination is approved by the board of directors of the corporation
and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least
662/3% of the outstanding voting stock which is not owned by the interested stockholder.
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Generally, a business combination includes
a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. An interested
stockholder is a person who, together with affiliates and associates, owns or, within three years prior to the determination
of interested stockholder status, did own 15% or more of a corporation’s outstanding voting stock. We expect the existence
of this provision to have an anti-takeover effect with respect to transactions our board of directors does not approve in advance.
We also anticipate that Section 203 may discourage business combinations or other attempts that might result in the payment
of a premium over the market price for the shares of common stock held by our stockholders.
The provisions of Delaware law and our
Certificate of Incorporation and amended and restated bylaws could have the effect of discouraging others from attempting hostile
takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock that often
result from actual or rumored takeover attempts. These provisions may also have the effect of preventing changes in our management.
It is possible that these provisions could make it more difficult to accomplish transactions that stockholders may otherwise deem
to be in their best interests.
DESCRIPTION OF WARRANTS
We may issue warrants for the purchase
of common stock or preferred stock. Warrants may be issued independently or together with common stock or preferred stock and may
be attached to or separate from any offered securities. Each series of warrants will be issued under a separate warrant agreement
to be entered into between us and a warrant agent. The warrant agent will act solely as our agent in connection with the warrants
and will not assume any obligation or relationship of agency or trust for or with any registered holders of warrants or beneficial
owners of warrants. This summary of some provisions of the warrants is not complete. You should refer to the warrant agreement,
including the forms of warrant certificate representing the warrants, relating to the specific warrants being offered for the complete
terms of the warrant agreement and the warrants. That warrant agreement, together with the terms of the warrant certificate and
warrants, will be filed with the SEC in connection with the offering of the specific warrants.
The particular terms of any issue of warrants
will be described in the prospectus supplement relating to the issue. Those terms may include:
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the title of such warrants;
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the aggregate number of such warrants;
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the price or prices at which such warrants will be issued;
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the terms of the securities purchasable upon exercise of such warrants and the procedures and conditions relating to the exercise
of such warrants;
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the price at which the securities purchasable upon exercise of such warrants may be purchased;
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the date on which the right to exercise such warrants will commence and the date on which such right shall expire;
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any provisions for adjustment of the number or amount of securities receivable upon exercise of the warrants or the exercise
price of the warrants;
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if applicable, the minimum or maximum amount of such warrants that may be exercised at any one time;
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if applicable, the designation and terms of the securities with which such warrants are issued and the number of such warrants
issued with each such security;
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if applicable, the date on and after which such warrants and the related securities will be separately transferable;
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information with respect to book-entry procedures, if any; and
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any other terms of such warrants, including terms, procedures and limitations relating to the exchange or exercise of such
warrants.
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The prospectus supplement relating to any
warrants to purchase equity securities may also include, if applicable, a discussion of certain U.S. federal income tax considerations.
Warrants for the purchase of common stock
or preferred stock will be offered and exercisable for U.S. dollars only. Securities warrants will be issued in registered form
only.
Each warrant will entitle its holder to
purchase the number of shares of common stock or preferred stock at the exercise price set forth in, or calculable as set forth
in, the applicable prospectus supplement.
After the close of business on the expiration
date, unexercised warrants will become void. We will specify the place or places where, and the manner in which, warrants may be
exercised in the applicable prospectus supplement.
Upon receipt of payment and the warrant
certificate properly completed and duly executed at the corporate trust office of the warrant agent or any other office indicated
in the applicable prospectus supplement, we will, as soon as practicable, forward the purchased securities. If less than all of
the warrants represented by the warrant certificate are exercised, a new warrant certificate will be issued for the remaining warrants.
Prior to the exercise of any warrants to
purchase common stock or preferred stock, holders of the warrants will not have any of the rights of holders of common stock or
preferred stock purchasable upon exercise, including the right to vote or to receive any payments of dividends on the common stock
or preferred stock purchasable upon exercise.
DESCRIPTION OF SUBSCRIPTION RIGHTS
The following is a general description
of the terms of the subscription rights we may issue from time to time. Particular terms of any subscription rights we offer will
be described in the prospectus supplement or free writing prospectus relating to such subscription rights, and may differ from
the terms described herein.
We may issue subscription rights to purchase
our securities. These subscription rights may be issued independently or together with any other security offered hereby and may
or may not be transferable by the stockholder receiving the subscription rights in such offering. In connection with any offering
of subscription rights, we may enter into a standby arrangement with one or more underwriters or other purchasers pursuant to which
the underwriters or other purchasers may be required to purchase any securities remaining unsubscribed for after such offering.
The applicable prospectus supplement will describe the specific terms of any offering of subscription rights for which this prospectus
is being delivered, including the following:
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whether common stock, preferred stock or warrants for those securities will be offered under the stockholder subscription rights;
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the price, if any, for the subscription rights;
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the exercise price payable for each security upon the exercise of the subscription rights;
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the number of subscription rights issued to each stockholder;
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the number and terms of the securities which may be purchased per each subscription right;
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the extent to which the subscription rights are transferable;
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any other terms of the subscription rights, including the terms, procedures and limitations relating to the exchange and exercise
of the subscription rights;
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the date on which the right to exercise the subscription rights shall commence, and the date on which the subscription rights
shall expire;
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the extent to which the subscription rights may include an over-subscription privilege with respect to unsubscribed securities;
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if appropriate, a discussion of material U.S. federal income tax considerations; and
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if applicable, the material terms of any standby underwriting or purchase arrangement entered into by us in connection with
the offering of subscription rights.
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The description in the applicable prospectus
supplement of any subscription rights we offer will not necessarily be complete and will be qualified in its entirety by reference
to the applicable subscription rights certificate or subscription rights agreement, which will be filed with the SEC if we offer
subscription rights.
DESCRIPTION OF UNITS
The following description, together with
the additional information that we include in any applicable prospectus supplements, summarizes the material terms and provisions
of the units that we may offer under this prospectus. While the terms we have summarized below will apply generally to any units
that we may offer under this prospectus, we will describe the particular terms of any series of units in more detail in the
applicable prospectus supplement. The terms of any units offered under a prospectus supplement may differ from the terms described
below.
We will incorporate by reference from reports
that we file with the SEC, the form of unit agreement that describes the terms of the series of units we are offering, and
any supplemental agreements, before the issuance of the related series of units. The following summaries of material terms
and provisions of the units are subject to, and qualified in their entirety by reference to, all the provisions of the unit
agreement and any supplemental agreements applicable to a particular series of units. We urge you to read the applicable prospectus
supplements related to the particular series of units that we may offer under this prospectus, as well as any related free
writing prospectuses and the complete unit agreement and any supplemental agreements that contain the terms of the units.
General
We may issue units consisting of common
stock, preferred stock, warrants, or subscription rights in one or more series, in any combination. Each unit will be issued so
that the holder of the unit is also the holder of each security included in the unit. Thus, the holder of a unit will have the
rights and obligations of a holder of each security included in the unit. The unit agreement under which a unit is issued may provide
that the securities included in the unit may not be held or transferred separately, at any time or at any time before a specified
date.
We will describe in the applicable prospectus
supplement the terms of the series of units being offered, including:
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the designation and terms of the units and of the securities comprising the units, including whether and under what
circumstances those securities may be held or transferred separately;
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any provisions of the governing unit agreement that differ from those described below; and
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any provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising
the units.
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The provisions described in this section,
as well as those set forth in any prospectus supplement or as described under “Description of Capital Stock,” “Description
of Warrants,” and “Description of Subscription Rights” will apply to each unit, as applicable, and to any common
stock, preferred stock, warrant, or subscription right included in each unit, as applicable.
Unit Agent
The name and address of the unit agent
for any units we offer will be set forth in the applicable prospectus supplement.
Issuance in Series
We may issue units in such amounts and in such numerous
distinct series as we determine.
Enforceability of Rights by Holders of Units
Each unit agent will act solely as our
agent under the applicable unit agreement and will not assume any obligation or relationship of agency or trust with any holder
of any unit. A single bank or trust company may act as unit agent for more than one series of units. A unit agent will have
no duty or responsibility in case of any default by us under the applicable unit agreement or unit, including any duty or responsibility
to initiate any proceedings at law or otherwise, or to make any demand upon us. Any holder of a unit may, without the consent of
the related unit agent or the holder of any other unit, enforce by appropriate legal action its rights as holder under any security
included in the unit.
PLAN OF DISTRIBUTION
We may offer and sell the securities from
time to time in one or more of the following transactions:
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to or through underwriters, brokers or dealers (acting as agent or principal);
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on The Nasdaq Capital Market, in the over-the-counter market or on any other national securities exchange on which our shares
are then listed or traded;
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directly to one or more other purchasers;
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upon the exercise of rights distributed or issued to our security holders;
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through a block trade in which the broker or dealer engaged to handle the block trade will attempt to sell the securities as
agent, but may position and resell a portion of the block as principal to facilitate the transaction;
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in “at the market” offerings within the meanings of Rule 415(a)(4) under the Securities Act of 1933 or
through a market maker or into an existing market, on an exchange, or otherwise;
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directly to purchasers, through a specific bidding or auction process, on a negotiated basis or otherwise;
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in ordinary brokerage transactions and transactions in which the broker solicits purchasers;
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through the writing or settlement of options (including put or call options), whether the options are listed on an options
exchange or otherwise;
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through agents on a best-efforts basis;
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through any other method permitted pursuant to applicable law; or
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otherwise through a combination of any of the above methods of sale.
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In addition, we may enter into option,
share lending or other types of transactions that require us to deliver shares of common stock to an underwriter, broker or dealer,
who will then resell or transfer the shares of common stock under this prospectus. We may also enter into hedging transactions
with respect to our securities. For example, we may:
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enter into transactions involving short sales of the shares of common stock by underwriters, brokers or dealers;
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sell shares of common stock short and deliver the shares to close out short positions;
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enter into option or other types of transactions that require us to deliver shares of common stock to an underwriter, broker
or dealer, who will then resell or transfer the shares of common stock under this prospectus; or
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loan or pledge the shares of common stock to an underwriter, broker or dealer, who may sell the loaned shares or, in the event
of default, sell the pledged shares.
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We may enter into derivative transactions
with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If
the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered
by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use
securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of stock,
and may use securities received from us in settlement of those derivatives to close out any related open borrowings of stock. The
third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be identified in the
applicable prospectus supplement (or a post-effective amendment). In addition, we may otherwise loan or pledge securities to a
financial institution or other third party that in turn may sell the securities short using this prospectus. Such financial institution
or other third party may transfer its economic short position to investors in our securities or in connection with a concurrent
offering of other securities.
If we use any underwriter, we will provide
a prospectus supplement that will name any underwriter involved in the offer and sale of the securities. The prospectus supplement
will also set forth the terms of the offering, including:
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the purchase price of the securities and the proceeds we will receive from the sale of the securities;
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any underwriting discounts and other items constituting underwriters’ compensation;
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any public offering or purchase price and any discounts or commissions allowed or re-allowed or paid to dealers;
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any commissions allowed or paid to agents;
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any securities exchanges on which the securities may be listed;
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the method of distribution of the securities;
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the terms of any agreement, arrangement or understanding entered into with the underwriters, brokers or dealers; and
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any other information we think is important.
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If underwriters or dealers are used in
the sale, the securities will be acquired by the underwriters or dealers for their own account. The securities may be sold from
time to time by us in one or more transactions:
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at a fixed price or prices, which may be changed;
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at market prices prevailing at the time of sale;
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at prices related to such prevailing market prices;
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at varying prices determined at the time of sale; or
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Such sales may be effected:
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in transactions on any national securities exchange or quotation service on which the securities may be listed or quoted at
the time of sale;
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in transactions in the over-the-counter market;
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in block transactions in which the broker or dealer so engaged will attempt to sell the securities as agent but may position
and resell a portion of the block as principal to facilitate the transaction, or in crosses, in which the same broker acts as an
agent on both sides of the trade;
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through the writing of options; or
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through other types of transactions.
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The securities may be offered to the public
either through underwriting syndicates represented by one or more managing underwriters or directly by one or more of such firms.
Unless otherwise set forth in the prospectus supplement, the obligations of underwriters or dealers to purchase the securities
offered will be subject to certain conditions precedent and the underwriters or dealers will be obligated to purchase all the offered
securities if any are purchased. Any public offering price and any discount or concession allowed or reallowed or paid by underwriters
or dealers to other dealers may be changed from time to time.
We may also make direct sales through subscription
rights distributed to our existing stockholders on a pro rata basis, which may or may not be transferable. In any distribution
of subscription rights to our stockholders, if all of the underlying securities are not subscribed for, we may then sell the unsubscribed
securities directly to third parties or may engage the services of one or more underwriters, dealers or agents, including standby
underwriters, to sell the unsubscribed securities to third parties. In addition, whether or not all of the underlying securities
are subscribed for, we may concurrently offer additional securities to third parties directly or through underwriters, dealers
or agents.
The securities may be sold directly by
us through agents designated by us, as applicable, from time to time. Any agent involved in the offer or sale of the securities
in respect of which this prospectus is delivered will be named, and any commissions payable by us, as applicable, to such agent
will be set forth in, the prospectus supplement. Unless otherwise indicated in the prospectus supplement, any such agent will be
acting on a best efforts basis for the period of its appointment.
Offers to purchase the securities offered
by this prospectus may be solicited, and sales of the securities may be made by us directly to institutional investors or others,
who may be deemed to be underwriters within the meaning of the Securities Act of 1933 with respect to any resale of the securities.
The terms of any offer made in this manner will be included in the prospectus supplement relating to the offer.
If indicated in the applicable prospectus
supplement, underwriters, dealers or agents will be authorized to solicit offers by certain institutional investors to purchase
securities from us pursuant to contracts providing for payment and delivery at a future date. Institutional investors with which
these contracts may be made include, among others:
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commercial and savings banks;
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investment companies; and
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educational and charitable institutions.
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In all cases, these purchasers must be
approved by us. Unless otherwise set forth in the applicable prospectus supplement, the obligations of any purchaser under any
of these contracts will not be subject to any conditions except that (a) the purchase of the securities must not at the time
of delivery be prohibited under the laws of any jurisdiction to which that purchaser is subject, and (b) if the securities
are also being sold to underwriters, we must have sold to these underwriters the securities not subject to delayed delivery. Underwriters
and other agents will not have any responsibility in respect of the validity or performance of these contracts.
Some of the underwriters, dealers or agents
used by us in any offering of securities under this prospectus may be customers of, engage in transactions with, and perform services
for us or affiliates of ours in the ordinary course of business. Underwriters, dealers, agents and other persons may be entitled
under agreements which may be entered into with us to indemnification against and contribution toward certain civil liabilities,
including liabilities under the Securities Act of 1933, as amended, and to be reimbursed by us for certain expenses.
Any securities initially sold outside the
U.S. may be resold in the U.S. through underwriters, dealers or otherwise.
Any underwriters to which offered securities
are sold by us for public offering and sale may make a market in such securities, but those underwriters will not be obligated
to do so and may discontinue any market making at any time.
The anticipated date of delivery of the
securities offered by this prospectus will be described in the applicable prospectus supplement relating to the offering.
In compliance with the guidelines of the
Financial Industry Regulatory Authority (“FINRA”), the aggregate maximum discount, commission, agency fees or other
items constituting underwriting compensation to be received by any FINRA member or independent broker-dealer will not exceed 8%
of the offering proceeds from any offering pursuant to this prospectus and any applicable prospectus supplement.
No FINRA member may participate in any
offering of securities made under this prospectus if such member has a conflict of interest under FINRA Rule 5121, including
if 5% or more of the net proceeds, not including underwriting compensation, of any offering of securities made under this prospectus
will be received by a FINRA member participating in the offering or affiliates or associated persons of such FINRA members, unless
a qualified independent underwriter has participated in the offering or the offering otherwise complies with FINRA Rule 5121.
To comply with the securities laws of some
states, if applicable, the securities may be sold in these jurisdictions only through registered or licensed brokers or dealers.
In addition, in some states the securities may not be sold unless they have been registered or qualified for sale or an exemption
from registration or qualification requirements is available and is complied with.
The Company is required to pay certain
fees and expenses incurred by the Company incident to the registration of the securities.
We agreed to keep this prospectus effective
until the date on which all registrable securities covered by this prospectus have been sold hereunder.
LEGAL MATTERS
The validity of the securities offered
by this prospectus will be passed upon for us by our counsel, Reed Smith LLP, Palo Alto, California.
EXPERTS
The financial statements of the Company
as of December 31, 2019 and for the fiscal year ended December 31, 2019 incorporated by reference in this prospectus
and the registration statement have been so incorporated in reliance on the report of Mayer Hoffman McCann P.C., an independent
registered public accounting firm (the report on the financial statements contains an explanatory paragraph regarding the Company’s
ability to continue as a going concern), incorporated herein by reference, given on the authority of said firm as experts in auditing
and accounting.
The financial statements of the Company
as of December 31, 2018 and for the fiscal year ended December 31, 2018 incorporated by reference in this prospectus
and the registration statement have been so incorporated in reliance on the report of BDO USA, LLP, an independent registered public
accounting firm (the report on the financial statements contains an explanatory paragraph regarding the Company’s ability
to continue as a going concern), incorporated herein by reference, given on the authority of said firm as experts in auditing and
accounting.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the reporting requirements
of the Securities Exchange Act of 1934, as amended, and file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy these reports, proxy statements and other information at the SEC’s public
reference facilities at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You can request copies of these documents by writing
to the SEC and paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for more information about the operation
of the public reference facilities. SEC filings are also available at the SEC’s web site at http://www.sec.gov.
This prospectus is only part of a registration
statement on Form S-3 that we have filed with the SEC under the Securities Act and therefore omits certain information contained
in the registration statement. We have also filed exhibits and schedules with the registration statement that are excluded from
this prospectus, and you should refer to the applicable exhibit or schedule for a complete description of any statement referring
to any contract or other document. You may inspect a copy of the registration statement, including the exhibits and schedules,
without charge, at the public reference room or obtain a copy from the SEC upon payment of the fees prescribed by the SEC.
We also maintain a website at https://jaguar.health,
through which you can access our SEC filings. The information set forth on, or accessible from, our website is not part of this
prospectus.
INCORPORATION OF INFORMATION BY REFERENCE
The SEC allows us to “incorporate
by reference” information that we file with them. Incorporation by reference allows us to disclose important information
to you by referring you to those other documents. The information incorporated by reference is an important part of this prospectus,
and information that we file later with the SEC will automatically update and supersede this information. This prospectus omits
certain information contained in the registration statement, as permitted by the SEC. You should refer to the registration statement
and any prospectus supplement filed hereafter, including the exhibits, for further information about us and the securities we may
offer pursuant to this prospectus. Statements in this prospectus regarding the provisions of certain documents filed with, or incorporated
by reference in, the registration statement are not necessarily complete and each statement is qualified in all respects by that
reference. Copies of all or any part of the registration statement, including the documents incorporated by reference or the exhibits,
may be obtained upon payment of the prescribed rates at the offices of the SEC listed above in “Where You Can Find More Information.”
The documents we are incorporating by reference are:
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our Current Reports on Form 8-K filed on January 27,
2020, February 27,
2020, February 28,
2020, March 6,
2020, March 23,
2020, March 26,
2020, April 10,
2020 (as subsequently amended on Form 8-K/A on May 13,
2020), April 16,
2020, May 8,
2020, May 18,
2020, May 21,
2020, May 22,
2020, May 28,
2020, June 19,
2020, June 26,
2020, July 14,
2020, July 21,
2020, August 21,
2020, September 2, 2020, September 2,
2020, September 9,
2020 and September 11,
2020 (in each case, except for information contained therein which is furnished rather than filed);
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all reports and other documents subsequently filed by us pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange
Act after the date of this prospectus and prior to the termination or completion of the offering of securities under this prospectus
shall be deemed to be incorporated by reference in this prospectus and to be a part hereof from the date of filing such reports
and other documents.
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Unless otherwise noted, the SEC file number
for each of the documents listed above is 001-36714.
In addition, all reports and other documents
filed by us pursuant to the Exchange Act after the date of the initial registration statement and prior to effectiveness of the
registration statement shall be deemed to be incorporated by reference into this prospectus.
Any statement contained in this prospectus
or in a document incorporated or deemed to be incorporated by reference into this prospectus will be deemed to be modified or superseded
for purposes of this prospectus to the extent that a statement contained in this prospectus or any other subsequently filed document
that is deemed to be incorporated by reference into this prospectus modifies or supersedes the statement. Any statement so modified
or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
You may request, orally or in writing,
a copy of any or all of the documents incorporated herein by reference. These documents will be provided to you at no cost, by
contacting: Investor Relations, Jaguar Health, Inc., 201 Mission Street, Suite 2375, San Francisco, CA, 94105 or call
(415) 371-8300.
You should rely only on information contained
in, or incorporated by reference into, this prospectus and any prospectus supplement. We have not authorized anyone to provide
you with information different from that contained in this prospectus or incorporated by reference in this prospectus. We are not
making offers to sell the securities in any jurisdiction in which such an offer or solicitation is not authorized or in which the
person making such offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make such offer or solicitation.
4,437,870 Shares of Common Stock
PROSPECTUS SUPPLEMENT
January 13, 2021
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