Monday, August 31, 2015

Cynapsus closes $6-million offering

March 1, 2013 by · Leave a Comment 

Cynapsus Therapeutics (TSX-V:CTH) has completed a short-form prospectus offering of units for gross proceeds of slightly more than$6-million.

Michael J. Fox

Michael J. Fox

Concurrent with the closing of the offering, the company and holders of Series A to E debentures agreed to convert $4,031,406 in debt for common shares and warrants.

In addition, the company completed a share consolidation on the basis of one new common share for every 10 common shares outstanding.

Cynapsus will use proceeds to complete later this year a de-risking bioequivalence study of its APL-130277 drug candidate for Parkinson’s disease.

“This financing, together with the recent grant from the Michael J. Fox Foundation and the U.S. Patent Office’s notice of allowance, clearly put Cynapsus on a more solid foundation,” president and CEO Anthony Giovinazzo said in a satement.

“In this financing, we also attracted an international specialty pharmaceutical partner, who will become a significant shareholder and has agreed to provide strategic advice as part of our board of directors,” Mr. Giovinazzo added.

“This strategic investor brings immense expertise and experience in drug reformulations, approvals, commercialization, distribution, as well as FDA regulatory pathway, which Cynapsus will be pursuing for APL-130277.”

He said the company’s plan remains intact, namely to de-risk the project over the next two years and attract significant attention and valuation in the eyes of potential partners, including the strategic investor and major global and specialty pharmaceutical companies.

Mr. Giovinazzo said that given recent merger and acquisition activity in the pharma-biotech sector, “we believe there is a significant opportunity for an event that would see a substantial return to investors within a two-to-three year timeframe.”

In the offering, the company issued 13,061,688 units at a post-consolidation price of 46 cents per unit. Each Unit consists of one common share and one warrant, with each warrant entitling the holder to purchase an addiional share for 57.5 cents over the next 60 months.

Cynapsus said a strategic pharmaceutical investor paid $3.5-million for 7,608,696 units of the offering, resulting in ownership of more than 21% and 27% of the outstanding stock on a basic and fully diluted basis, respectively.

Cynapsus said it obtained written approval of shareholders holding more than 50% of the issued listed shares of the company for the new strategic investor.

The Cynapsus board also agreed to allow the strategic investor to nominate two new directors, subject to exchange approval. If and when approved, the company will have nine directors until the next annual meeting.

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