CINCINNATI - Onconetix, Inc. (NASDAQ:ONCO), a cancer diagnostics company, announced today the completion of a private placement totaling approximately $2 million. The transaction included the issuance of 3,499 shares of Series C Convertible Preferred Stock and warrants to purchase up to 591,856 additional shares of common stock. The preferred stock is initially convertible into roughly 776,590 common shares, with anti-dilution adjustments possible.
The warrants, exercisable at $4.38 per share, will become active six months post-issuance and expire three years from their initial exercisability date. Onconetix has also committed to seeking shareholder approval for the conversion of the preferred stock and the exercise of the warrants, as per Nasdaq regulations.
Onconetix plans to allocate the gross proceeds from this private placement towards working capital and general corporate purposes. Tungsten Advisors, through Finalis Securities, LLC, acted as the financial advisor for this transaction.
In a related financial move, Onconetix entered into a Common Stock Purchase Agreement on October 2, 2024, with an institutional investor, setting the stage for potential sales of up to $25 million in common stock. The company's ability to sell these shares is contingent upon the SEC declaring an effective registration statement for the resale of the shares.
Ralph Schiess, Interim CEO of Onconetix, expressed satisfaction with the funding arrangements, highlighting intentions to fund operations and explore growth opportunities with the proceeds.
Onconetix, formerly known as Blue Water Biotech, Inc., focuses on developing innovative solutions for oncology and men's health. The company recently acquired Proteomedix, gaining the Proclarix® diagnostic test for prostate cancer, approved in the EU and expected to be marketed in the U.S. through a Labcorp license agreement. Furthermore, Onconetix owns ENTADFI, an FDA-approved daily pill for benign prostatic hyperplasia treatment.
The company's forward-looking statements, including expectations for commercial activities and product marketing, are subject to risks and uncertainties. Factors such as market conditions, regulatory approvals, and intellectual property protection could impact Onconetix's operations and product commercialization.
This news is based on a press release statement from Onconetix, Inc.
In other recent news, Onconetix, a pharmaceutical company, has undergone a series of significant corporate actions. These include a reverse stock split and equity issuances to comply with Nasdaq listing rules. Onconetix also deferred payments on a $15 million debt to Veru (NASDAQ:VERU) Inc., as per an amended agreement, and announced plans for a substantial share issuance and a change of control. The company has faced compliance challenges with Nasdaq's listing standards, leading to a proposal for a reverse stock split to increase the per-share trading price of its common stock. It has also reduced the exercise price of certain existing warrants to $0.15 per share, aiming to raise approximately $1.11 million in gross proceeds. Finally, there have been significant changes in the executive team, with the departure of former CFO Bruce Harmon and the appointment of Karina M. Fedasz as the interim CFO. Onconetix has also engaged CFO Squad LLC for certain accounting services. These are recent developments reflecting the ongoing evolution of Onconetix.
InvestingPro Insights
Onconetix's recent private placement and potential stock sale agreement come at a critical time for the company, as revealed by InvestingPro data. With a market capitalization of just $38.15 million, the company's financial position appears precarious. The last twelve months' revenue stands at a modest $1.46 million, while the company reported a significant operating loss of $15.6 million for the same period.
These figures align with two key InvestingPro Tips: Onconetix is "quickly burning through cash" and "not profitable over the last twelve months." This context underscores the importance of the recent $2 million private placement and the potential $25 million stock sale agreement for the company's ongoing operations and development efforts.
Despite these financial challenges, Onconetix has seen a "significant return over the last week," with a 37.09% price increase. This recent uptick could be related to investor optimism surrounding the new funding arrangements and the company's strategic moves in the oncology and men's health markets.
It's worth noting that InvestingPro has identified 12 additional tips for Onconetix, offering investors a more comprehensive view of the company's financial health and market position. These insights could prove valuable for those closely following Onconetix's journey in the competitive biotech sector.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.