Faron Pharmaceuticals seeks EUR 10 million in private placement

TURKU, FINLAND - Faron Pharmaceuticals Ltd. (AIM: FARN, First North: FARON), a biopharmaceutical company, announced today a private placement aiming to raise approximately EUR 10 million. The placement is targeted at institutional and other investors via an accelerated book-building process, with Carnegie and Bryan Garnier as joint bookrunners.

The company plans to utilize the proceeds to continue the Phase II trial of its cancer immunotherapy drug, bexmarilimab, focusing on hematologic malignancies. The funds are expected to support the company’s working capital needs into Q4 2025 and maintain financial covenant compliance through August 2025. The book-building process commenced immediately following the announcement and is anticipated to conclude by 9:00 a.m. EET on Thursday.

The placement is part of a broader strategy to strengthen Faron’s financial position ahead of the BEXMAB Phase II trial topline readout expected in April 2025. The company’s CEO, Dr. Juho Jalkanen, emphasized the importance of the fundraise for the development program and the potential value for shareholders.

The proposed placement will be executed under the authorization from the company’s Annual General Meeting held on April 5, 2024, which allows the issuance of up to 20 million new shares. The current placement could see the issue of up to 19,113,496 shares, representing approximately 18.3% of the company’s issued shares and votes prior to the placement.

The issue price per share will be determined based on the bids received during the book-building process. The company has received non-binding expressions of interest from potential investors during the pre-marketing phase.

Following the book-building process, the company’s board will decide on the final number of shares to be issued and the issue price. The shares are expected to be admitted to trading on First North and AIM shortly after the placement is completed.

This move comes after the company explored various financing options, concluding that a private placement is the most suitable at this time. The placement is seen as a strategic step to enhance Faron’s negotiating position in potential commercial deals following the BEXMAB Phase II readout while ensuring compliance with financial covenants.

The announcement is based on a press release statement and provides information on the company’s ongoing efforts to secure funding for its operations and clinical trials.

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