Stem cell and regenerative medicine company Cynata Therapeutics (ASX:CYP) has raised about $2.05 million through an oversubscribed share purchase plan (SPP) to fund an upcoming clinical trial.
The company reports the SPP follows a placement completed in April 2023 that raised $5 million, and notes the SPP offered existing eligible shareholders the opportunity to subscribe for up to $30,000 worth of new shares.
Under the SPP, the shares were offered at the lower of the offer price under the placement, being $0.215, which represents a 2.5% discount to the volume weighted average price (VWAP) of shares during the 5 trading days prior to the closing date rounded to the nearest half cent.
At the closing date, Cynata reports it received valid applications for about $2.05 million worth of new shares under the SPP. In accordance with the pricing mechanism, the company says SPP shares have been priced at $0.155 per share, which also represents a 2.5% discount to the VWAP of shares during the 5 days prior to the closing date, rounded to the nearest half cent.
Due to the SPP being oversubscribed by $50,000, Cynata’s board has determined to apply an equal scale-back of applications so that each applicant will receive about 97.63% of the new shares they applied for. This will result in the issue of over 12.903 million new shares under the SPP.
These shares are expected to be issued on 11 May 2023, with trading expected to begin on 12 May 2023.
Cynata also reports participants in the SPP will receive free attaching options with an exercise price of $0.30, and an expiry date of 1 April 2025. Participants will receive an option for every 2 shares subscribed for. Cynata also notes it will apply for quotation of the options.
The company reports the issue of options is conditional on shareholder approval in a general meeting to be held on 25 May 2023. If approved by shareholders, Cynata expects to issue a total of over 6.451 million options on 31 May 2023.
Cynata reports the proceeds of about $7 million from the placement and SPP will be used for the upcoming phase two clinical trial in acute graft-versus-host disease (aGvHD), and for working capital.
Cynata Therapeutics is an Australian clinical-stage stem cell and regenerative health company focused on developing therapies based on Cymerus, which is a proprietary stell cell platform technology.
The company says Cymerus overcomes the challenges of other production methods by using induced pluripotent stem cells (iPSCs) and a precursor cell known as mesenchymoangioblast to achieve economic manufacture of cell therapy products, including mesenchymal stem cells (MSCs) at a commercial scale without the limitation of multiple donors.
According to Cynata, its lead product CYP-001 has met all clinical endpoints, and has demonstrated positive safety and efficacy data for the treatment of steroid-resistant acute GvHD in a phase one trial. Additionally, planning for a phase two clinical trial in GvHD under a cleared US Food and Drug Administration (FDA) Investigational New Drug Application (IND) is currently underway.
The company says it has also demonstrated Cymerus’ utility in preclinical models of critical limb ischaemia, idiopathic pulmonary fibrosis, asthma, heart attack, sepsis, acute respiratory distress syndrome (ARDS), and cytokine release syndrome.