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SAN DIEGO - Avidity Biosciences, Inc. (NASDAQ:RNA), a biopharmaceutical company specializing in RNA therapeutics, has announced its intention to conduct an underwritten public offering of $250 million in common stock. The company also plans to provide underwriters a 30-day option to purchase up to an additional $37.5 million in shares. The timing and exact terms of the offering remain subject to market conditions.
The proceeds from the stock sale are intended to support the development of Avidity’s clinical programs, advance its research and development, and for general corporate purposes. This includes funding for its proprietary platform of Antibody Oligonucleotide Conjugates (AOCs™), which are designed to target diseases previously inaccessible with existing RNA therapies.
Leerink Partners and TD Cowen are serving as joint bookrunning managers for the proposed offering. The offering will be made under a shelf registration statement filed with the Securities and Exchange Commission (SEC), which became automatically effective upon filing. A preliminary prospectus supplement and accompanying prospectus will be filed with the SEC and will be available from the bookrunning managers.
Avidity Biosciences is pioneering a new class of RNA therapeutics to address rare muscle diseases and is broadening its pipeline to include cardiology and immunology programs. The company's statement includes forward-looking remarks regarding the offering's completion, timing, and use of proceeds, and cautions that actual outcomes may differ due to market risks and uncertainties.
In other recent news, Avidity Biosciences reported positive preliminary results from a Phase 1/2 clinical trial for delpacibart zotadirsen, a potential treatment for Duchenne muscular dystrophy (DMD). The trial demonstrated significant increases in dystrophin production and exon 44 skipping, along with a substantial reduction in creatine kinase levels. Additionally, Avidity announced plans for a $300 million public offering of its common stock to fund further development of its clinical programs and research.
Financial analysts have shown interest in the company's developments. BofA Securities raised its price target from $40.00 to $45.00 while maintaining a Buy rating on Avidity's stock. Wells Fargo reaffirmed its Overweight rating, maintaining a steady price target of $50.00, and Cantor Fitzgerald initiated coverage on Avidity Biosciences with an Overweight rating.
In other developments, the company expanded its board of directors with the appointment of Simona Skerjanec, a pharmaceutical industry veteran. Lastly, the U.S. Food and Drug Administration granted Breakthrough Therapy designation to Avidity's lead investigational drug, delpacibart etedesiran, for the treatment of myotonic dystrophy type 1. These are the recent developments in the company's journey.
InvestingPro Insights
Avidity Biosciences, Inc. (NASDAQ:RNA) has been actively engaging the market with its recent public offering announcement. An examination of the company's financial health and stock performance through InvestingPro's lens provides investors with a clearer picture of Avidity's current standing.
InvestingPro Data reveals that Avidity holds a market capitalization of approximately $4.94 billion USD. The company's revenue for the last twelve months as of Q2 2024 stands at $10.6 million USD, reflecting a growth of 8.15%. This growth, however, is juxtaposed with a quarterly revenue decline of 11.7% in Q2 2024. The company's gross profit margin is significantly negative at -2082.31%, indicating challenges in generating profit from its revenues.
Despite these financial metrics, Avidity's stock has experienced a remarkable surge, with a 235.19% price total return over the last six months and an impressive 401.47% return over the past year. The stock is currently trading at 90.82% of its 52-week high with a previous close price of $44.48 USD. This performance is particularly noteworthy, aligning with one of the InvestingPro Tips that highlights the company's high return over the last year. Additionally, analysts have revised their earnings upwards for the upcoming period, suggesting a positive outlook on the company's potential to improve its financials.
However, it's important to note that Avidity's P/E ratio stands at -15.1, and analysts do not anticipate the company will be profitable this year. This is further emphasized by the InvestingPro Tip that the company suffers from weak gross profit margins and is not profitable over the last twelve months. Furthermore, Avidity does not pay a dividend to shareholders, a consideration for income-focused investors.
For those interested in a deeper dive into Avidity Biosciences' financial nuances, InvestingPro offers additional tips and metrics. There are currently over 10 additional InvestingPro Tips available at https://www.investing.com/pro/RNA, which can provide investors with more comprehensive insights into the company's financial health and market performance.
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