Pluristem Therapeutics Inc. (NASDAQ:PSTI)
Pluristem Therapeutics Inc. (NASDAQ:PSTI) shares fell 14.7% after announcing the pricing of a previously announced public offering of 9 million shares on the Tel-Aviv Stock Exchange. The developer of placenta-based cell therapy products has priced the offering at $1.67 a share and expects gross proceeds of $15.1 million.
PSTI Investors Reaction
The accepted orders in the aggregate amount of $15.1 million after the offering became over-subscribed. The minimum share price consequently increased from $1.61 to $1.67 a share. The offering should close on or about December 31, 2017.
Pluristem Therapeutics Inc. (NASDAQ:PSTI) plans to use net proceeds from the offering for research and product development. Part of the funds will also to be used to finance clinical trial activities, working capital, and for other general corporate purposes.
Investors reacted to the public offering pricing by pushing the stock lower. A point of concern is that the public offering was priced at a discount and that it could lead to further dilution of the stock. However, the stock continues to trade in an uptrend. The stock is up by more than 10% for the year.
The pricing of the public offering follows the Israel’s Ministry of Health approval of the company’s Phase 1 study of drug candidate PLX-R18. Pluristem Therapeutics Inc. (NASDAQ:PSTI) is investigating the drug candidate for the treatment of insufficient hematopoietic recovery following hematopoietic cell transplantation HCT. The U.S. Food and Drug Administration (FDA) has also approved the trial. In the United States, Pluristem is to recruit up to 30 patients for the trial.
“We’re very pleased with the Israeli Ministry of Health’s vote of confidence in our innovative therapies and efforts to provide treatments for a range of hematopoietic conditions, including insufficient recovery from hematopoietic stem cell transplants,” stated Zami Aberman, Pluristem Co-CEO, and Chairman
In addition, PLX-R18 is in late-stage development as a treatment for acute radiation syndrome (ARS). The cell therapy is designed to treat bone marrow that is unable to produce enough blood cells due to ARS. Pluristem Therapeutics Inc. (NASDAQ:PSTI) holds several patents that cover PLX-r18 for the treatment of impaired hematopoietic systems in case of a bone marrow transplant.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: Monica has an undergraduate degree in Accounting and an MBA she earned – with Honors. She has six years of experience in the financial markets and has been an analyst for the past two years.