DALLAS - Forte Biosciences, Inc. (NASDAQ: FBRX), a biopharmaceutical company specializing in autoimmune and related diseases, has successfully completed a $53 million equity financing round. The funding will bolster the continued clinical development of their therapeutic candidate FB102.
The investment round attracted a mix of new and existing institutional investors, including OrbiMed, Janus Henderson Investors, and Tybourne Capital Management, among others. This influx of capital positions Forte to further its research across various autoimmune indications.
The company has completed a healthy volunteer study and is currently conducting a celiac disease trial, with top-line results expected in the second quarter of 2025. Plans are also in place to expand FB102's clinical trials to additional indications within the next 12 months.
Paul Wagner, Ph.D., Chairman and CEO of Forte Biosciences, expressed gratitude for the investor support and emphasized the transformative impact of the financing on the company's trajectory. He also projected 2025 as a potentially significant year for FB102's clinical milestones.
Forte Biosciences will host an R&D Day on December 3rd to provide more details on their developments. TD Cowen served as the lead placement agent for the financing, with Guggenheim Securities offering Capital Markets Advisory services. Chardan, Rodman & Renshaw, and Brookline Capital Markets were co-placement managers.
FB102, Forte's proprietary anti-CD122 monoclonal antibody, is designed to address a broad range of autoimmune and autoimmune-related diseases.
The securities sold in this private placement have not been registered under the Securities Act of 1933 and will be subject to a registration statement to be filed with the SEC for resale by investors. The company cautions that forward-looking statements in the press release are not guarantees of future performance and are subject to risks and uncertainties.
This news is based on a press release statement from Forte Biosciences, Inc.
In other recent news, Forte Biosciences has undergone significant changes with a reshuffling of its board and a settlement of a pending lawsuit. The company appointed Richard Vincent and Shiv Kapoor to its Board of Directors, following the resignation of two existing members. The new appointments aim to maintain a balance among the Board's classes and involve the directors in key committee roles. Furthermore, Forte Biosciences resolved a lawsuit filed by Camac Fund, LP, agreeing to pay $1.5 million in attorneys' fees to the plaintiff's counsel.
The company also executed a 1-for-25 reverse stock split as part of a significant change in its capital structure. This led to proportional adjustments in the company's equity incentive plans, affecting the number of shares subject to outstanding equity awards and the per-share exercise or purchase price. Additionally, Forte Biosciences announced the approval of an amended and restated equity incentive plan, designed to attract, retain, and motivate personnel through equity awards, with 8,500,000 shares of common stock reserved for issuance under this plan.
In analyst news, Brookline Capital Markets initiated coverage with a Buy rating for Forte Biosciences, noting the potential of FB-102, an antibody currently in development for the treatment of graft versus host disease (GVHD). Preliminary data suggests FB-102 could offer a superior product profile compared to the current standard of care for treating GVHD. These developments are part of a series of recent actions taken by the company to enhance its capital structure and to continue its research and development efforts.
InvestingPro Insights
Forte Biosciences' recent $53 million equity financing comes at a critical time for the company, as revealed by InvestingPro data and tips. Despite the successful funding round, the company faces significant financial challenges. InvestingPro Tips indicate that Forte is "quickly burning through cash" and is "not profitable over the last twelve months." This context underscores the importance of the recent capital injection for sustaining the company's research and development efforts.
The company's financial health presents a mixed picture. On one hand, Forte "holds more cash than debt on its balance sheet," and its "liquid assets exceed short term obligations," providing some financial stability. However, the company "suffers from weak gross profit margins," which could impact its ability to generate profits from its operations in the near term.
Investor sentiment towards Forte has been volatile. While the stock has seen a "strong return over the last month" with a 25.27% price increase, it has also "taken a big hit over the last six months," with a -60.96% price total return. This volatility reflects the high-risk, high-reward nature of biotech investments, especially for companies in the clinical development stage like Forte.
Looking ahead, analysts seem cautious about Forte's near-term prospects. InvestingPro Tips reveal that "analysts do not anticipate the company will be profitable this year," and "2 analysts have revised their earnings downwards for the upcoming period." These insights suggest that while the recent funding provides a runway for FB102's development, the path to profitability may be challenging.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for Forte Biosciences, providing a deeper understanding of the company's financial position and market performance.
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