Lexaria Bioscience raises $4 million in registered direct offering

KELOWNA, BC - Lexaria Bioscience Corp. (NASDAQ:LEXX) announced Friday it has entered into a definitive agreement to sell 2,666,667 shares of common stock at $1.50 per share in a registered direct offering priced at-the-market under Nasdaq rules. The announcement comes as the company’s stock has shown strong momentum, with InvestingPro data showing a 23% return over the past week and notable gains over the past three months.

The drug delivery platform company will also issue unregistered warrants to purchase up to 2,666,667 additional shares in a concurrent private placement. These warrants will have an exercise price of $1.37 per share, will be immediately exercisable, and will expire five years after the effectiveness of the resale registration statement.

The offering, expected to close around Monday, is anticipated to generate approximately $4 million in gross proceeds before deducting placement agent fees and other expenses. H.C. Wainwright & Co. is serving as the exclusive placement agent for the transaction.

Lexaria intends to use the net proceeds for working capital and general corporate purposes, according to the press release statement.

The common stock shares are being offered through a "shelf" registration statement previously declared effective by the SEC, while the warrants are being issued in a private placement under Section 4(a)(2) of the Securities Act.

Lexaria Bioscience develops DehydraTECH, a drug delivery formulation and processing platform technology designed to improve how drugs enter the bloodstream through oral delivery. The company currently holds 50 granted patents with additional patents pending worldwide.

In other recent news, Lexaria Bioscience Corp. announced the termination of its Capital on Demand Sales Agreement with JonesTrading Institutional Services LLC, which had allowed the company to sell up to $5 million in common stock. By the time of termination, Lexaria had sold 14,995 shares, generating gross proceeds of $38,236. Additionally, Lexaria reported that its DehydraTECH technology demonstrated improved brain delivery of semaglutide in a rodent study, showing higher brain levels compared to conventional formulations. The company also completed patient dosing in its Phase 1b glucagon-like peptide-1 (GLP-1) study in Australia, marking the transition to the data analysis phase.

H.C. Wainwright adjusted its price target for Lexaria Bioscience to $4.00 from $5.00, while maintaining a Buy rating, following the company’s announcement of interim results from the ongoing Phase 1b GLP-1-H24-4 study. These results focused on various arms of the study, including DehydraTECH-semaglutide and DehydraTECH-tirzepatide. Despite the price target adjustment, the study’s progress continues to be a focal point for investors. These developments reflect Lexaria’s ongoing efforts in advancing its drug delivery technologies.

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