The Walloon biotech company Bone Therapeutics has secured financing of $12 million (€11 million) pending the launch of a capital increase when the markets are more favorable. This round of financing is a solid thorn in the side for Bone Therapeutics, which urgently needed to fill its coffers in order to be able to carry out its projects.
With an estimated “cash burn” of between $16.3 and $18.5 million (€15 and €17 million) for the current financial year and only $9.3 million (€8.6 million) in cash in its coffers at the end of 2019, the situation was becoming worrying for this biotech company specializing in orthopedics and bone diseases.
This extension, which will enable the company to continue its activities until the first quarter of 2021, consists of three components: bridging loans of $5.17 million (€4.75 million) granted by commercial banks and Sambrinvest subject to obtaining credit insurance, an equity contribution of $1.37 million (€1.26 million) by the shareholders and a private placement of convertible bonds for $5.43 million (€4.99 million) used as required.
Two clinical trials
With the funds raised, Bone Therapeutics intends to advance two clinical trials. One, in Phase III, involves JTA-004, a gel designed to treat people with osteoarthritis of the knee. Results from this lead product are expected in the second half of 2021.
The other concerns the phase IIb trial of Allob in patients with tibia fractures at risk of delayed healing. Here, data will have to wait until mid-2022.
“The coronavirus-induced situation has put most non-core clinical trials on hold to preserve capacity in hospitals around the world,” KBC Securities analysts said. “We estimate that the situation in hospitals won’t begin to return to normal until after the summer.”
Their value recommendation remains to be “kept” with an unchanged price target of $4.35 (€4). Kepler Cheuvreux is also advising the same, but with a target of $6.2 (€5.7).
Other biotech companies that have successfully closed financing rounds
In the space of a few days, several biotechs listed on Euronext Brussels such as Mithra, MDxHealth and Kiadis took advantage of the relative lull observed on the stock market to consolidate their financial position.
On Friday, April 24th, Mithra announced a financing agreement with LDA Capital guaranteeing it direct access to $54.3 million (€50 million). On April 27th, the Belgian-American biotech MDxHealth signaled its intention to raise $13.8 million (€12.7 million) via the issue of 20.1 million shares subscribed by MVM Partners, which, in the process, will become the reference shareholder.
The Dutch biotech company Kiadis concluded a private placement of $13 million (€12 million) relating to 7.5 million new shares at a unit price of $1.74 (€1.60) with an American investment fund specializing in healthcare. The investor will also receive 3.75 million warrants with an exercise price of $2.39 (€2.22). They can be exercised within 5 years. After the private placement of $13 million (€12 million), Kiadis’ cash will amount to $34.2 million (€31.5 million).
In November, Kiadis made an important strategic shift by abandoning the development of its flagship product ATIR 101, whose advantages over standard treatment no longer seemed so obvious.
It is now focusing on its natural killer (NK) cell therapy platform. The cash will be used, among other things, for the clinical development of K-NK002 (adjunctive therapy for blood cancer patients undergoing hematopoietic stem cell transplantation) and K-NK003 (treatment of acute myeloid leukemia).
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