San Francisco, CA – November 12, 2024 – In a strategic move to bolster its financial standing, clinical-stage biopharmaceutical company 89bio, Inc. (Nasdaq: ETNB) has announced the pricing of an upsized public offering of common stock amounting to $125 million. This announcement comes on the heels of the company’s cumulative net loss of $175 million over the past year, marking a troubling negative return on investment of -33.56%.The offered shares, totaling 11,455,882, will be sold at a public offering price of $8.50 each. In a unique arrangement designed to accommodate certain investors, the company will also offer pre-funded warrants, allowing the purchase of up to 3,250,000 additional shares at a slightly lower price of $8.499. These pre-funded warrants come with an exercise price of just $0.001 per share and can be exercised immediately, presenting an attractive proposition for investors looking for enhanced liquidity.
Furthermore, underwriters of the offering have been granted an option to acquire up to an additional 2,205,882 shares at the public offering price, indicating robust investor interest and the potential for expanded capital influx. The gross proceeds from this offering, expected to close around November 14, 2024, are projected to be approximately $125 million before the deduction of customary underwriting discounts and other expenses.
Despite the recent uptick in share price—stunningly rising by 30.79% over the past 90 days—the company faces significant challenges. The recorded net loss underscores the imperative for 89bio to secure funding to advance its portfolio of innovative therapies aimed at treating liver and cardiometabolic diseases. The funds raised from this public offering will be critical for the company to continue its research and development efforts, aiming to mitigate the financial pressures affecting its operational capabilities.
As the biotechnology sector continues to evolve and face headwinds, investors will be closely monitoring how 89bio maneuvers its resources and strategies in the wake of this substantial capital raise. The effectiveness of this offering in reversing the company’s fortunes and enhancing its market position remains to be seen, but it undoubtedly represents a significant step in its ongoing battle for stability and growth in a competitive industry landscape.
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