Larimar Therapeutics launches public offering of common stock

BALA CYNWYD, Pa. - Larimar Therapeutics, Inc. (NASDAQ:LRMR), a clinical-stage biotech with a market capitalization of $226 million and strong analyst support with price targets ranging from $10 to $40, announced Tuesday it has commenced an underwritten public offering of common stock shares and pre-funded warrants to purchase common stock for certain investors who prefer that option.

The clinical-stage biotechnology company, which focuses on developing treatments for complex rare diseases, plans to grant underwriters a 30-day option to purchase up to an additional 15% of the securities at the public offering price, less underwriting discounts and commissions. According to InvestingPro data, while the company maintains a healthy current ratio of 7.48, it’s currently experiencing rapid cash burn, making this offering particularly significant for its operations.

Leerink Partners and Guggenheim Securities are serving as joint bookrunning managers for the proposed offering, according to the company’s press release statement.

Larimar intends to use proceeds from the offering to support the development of nomlabofusp, its lead compound being developed as a potential treatment for Friedreich’s ataxia, as well as other pipeline candidates. Funds will also go toward working capital and general corporate purposes, including research and development expenses and pre-commercialization expenses. With the company’s next earnings report due on August 7, investors can access comprehensive analysis and 10+ additional financial health indicators through InvestingPro’s detailed research reports.

The offering is being made pursuant to a shelf registration statement on Form S-3 that was declared effective by the Securities and Exchange Commission on May 24, 2024.

The company noted that the proposed offering is subject to market and other conditions, with no assurance as to whether or when the offering may be completed, or the actual size or terms of the offering.

All shares of common stock and pre-funded warrants in the proposed offering will be sold by Larimar.

In other recent news, Larimar Therapeutics announced the publication of two peer-reviewed articles detailing nonclinical data on its frataxin protein replacement therapy, nomlabofusp, for Friedreich’s ataxia. The research highlights nomlabofusp’s mechanism of action and its potential to increase FXN levels in critical tissues. Additionally, Larimar has adjusted its timeline for submitting a Biologics License Application (BLA) for nomlabofusp to the second quarter of 2026. This delay follows recommendations from the FDA regarding safety database requirements and the use of skin frataxin concentrations as a surrogate endpoint. The company plans to seek accelerated approval, incorporating safety data from a minimum of 30 participants, including a subset with extended exposure. Despite the timeline extension, the stock maintains an Outperform rating, reflecting optimism from firms like Investing.com. These developments underscore Larimar’s ongoing efforts to advance its treatment for Friedreich’s ataxia.

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