Clinical stage biopharmaceutical company Cortexyme Inc. (CRTX:NASDAQ), which concentrates its efforts on pioneering a disease-modifying therapeutic approach to treat Alzheimer's and other degenerative diseases, yesterday announced that "it has entered into stock purchase agreements with a group of institutional investors and an entity affiliated with a member of Cortexyme's Board of Directors in connection with a private placement of its common stock."
The company reported that it expects to receive $125 million in gross proceeds prior to incurred transaction expenses. The firm advised that in exchange for investment capital, it will issue 2,500,000 shares of common stock at a purchase price of $50.00 per share. The price was based upon an agreed upon average volume weighted common share price since January 1, 2020 and represents a 9.6% premium to the closing price of the company's common stock on February 5, 2020.
The Company noted that it plans to utilize the net proceeds received primarily to advance clinical development, and for general corporate purposes. The firm indicated that the private placement, which is subject to certain conditions, is expected to close on Monday, February 10, 2020.
Cortexyme is based in South San Francisco, Calif. and describes its business as "a clinical stage biopharmaceutical company pioneering a novel disease-modifying therapeutic approach to treat a key underlying cause of Alzheimer's and other degenerative diseases." The company's research is focused on targeting a specific, infectious pathogen found in the brain of Alzheimer's patients that has been tied to neurodegeneration and neuroinflammation in animal models. Cortexyme's lead small molecule is an investigational medicine named COR388 that has advanced through preclinical and Phase 1b testing. The firm is presently conducting the GAIN Phase 2/3 clinical trial of COR388 in patients affected with mild to moderate Alzheimer's disease.
Cortexyme Inc. has a market capitalization of around $1.2 billion with approximately 26.85 million shares outstanding and a short interest of about 5.2%. CRTX shares opened 10% higher today at $50.20 (+$4.56, +9.99%) over yesterday's $45.64 closing price. The stock has traded today between $50.20 to $57.89 per share and is presently trading at $55.70 (+$10.06, +22.04%).
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