Stayble Therapeutics AB starts development of a new clinical indication and decides on a rights issue of approximately MSEK 35.2
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Stayble Therapeutics AB, (”Stayble” or ”the Company”) announces that the Board of Directors has resolved on a new issue of shares, with preferential rights for existing shareholders, for a maximum amount of approximately MSEK 35.2 before deduction of transaction related costs (“the Rights Issue”). The decision made by the Board of Directors is subject to approval of an extraordinary general meeting, planned to be held on March 16th 2023. Notice to the extraordinary general meeting of shareholders will be announced by a separate press release. The purpose of the Rights Issue is to provide the Company with funds for operating costs and to initiate a phase 1b clinical study of the pharmaceutical candidate STA363 towards the new indication lumbar disc herniation, where the Board sees a great potential. Furthermore, the Rights Issue is planned to finance the completion of the current phase 2b clinical study towards the indication degenerative disc disease and to prepare the organization for partnerships. The Rights Issue is covered up to 80 percent by underwriting and pre-subscription commitments by the Board of Directors, management, principal owners, other existent shareholders and external professional investors.
“By broadening the usage of our candidate STA363 to include the treatment for lumbar disc herniation, we will not only be able to help even more people with chronic pain, but also increase our market potential and diversify the risk for the Company. With growing market potential, and the positive results from earlier trials, we believe we have even greater opportunities to increase the value for our shareholders. Hence, we welcome more investors to share our vision of helping millions of people to a better life”, Stayble CEO Andreas Gerward says.
Summary
- Stayble’s Board of Directors has today decided on the Rights Issue. The decision by the Board is subject to the approval of an extraordinary general meeting of shareholders, planned for March 16th 2023.
- The Rights Issue, if fully subscribed, will provide Stayble with approximately 35,2 MSEK, before issuing costs.
- The subscription period of the Rights Issue will be March 24th 2023 up to and including April 12th 2023.
- Those who on the record date of March 21st 2023 are registered as shareholders in Stayble own preferential right to subscribe to shares in the current Rights Issue. For each existing share, one (1) subscription right is received. Seven (7) subscription rights entitle the holder to subscribe for ten (10) new shares.
- The subscription price has been determined to SEK 1.78 per new share.
- Approximately 11.7 percent of the Rights Issue are covered by pre-subscription commitments, approximately 38.2 percent by so-called bottom-up underwriting commitments and approximately 38.3 percent by so-called top-down underwriting commitments. Hence, the Rights Issue has commitments up to 80 percent.
- A number of members of the Board of Directors and management of the Company have together, through a so-called lock-up agreement, undertaken not to sell any existing shareholdings or such shareholdings that are received through subscription in the Rights Issue during a period of six months from the announcement of the Rights Issue.
Background, motive and milestones
Stayble is a clinical pharmaceutical company, developing the candidate drug STA363 for the treatment of chronic disc related back pain. According to the Board of Directors, STA363 has a competitive edge by being based on a body specific and well documented molecule, lactic acid, combined with a contrast agent in order to provide a safe and reliable injection. The treatment consists of a one-time injection with effects calculated to be lifelong and demanding minimal rehabilitation in comparison to surgical procedures.
The Company currently focuses on further clinical development of STA363 and is at the moment conducting a clinical phase 2b study of the indication degenerative disc disease (DDD). In August of 2022 the phase 2b study was fully recruited and all patients have gone through the three month and six months follow-ups. Currently the focus of Stayble is thus to secure that all patients complete their twelve-month follow-ups and meanwhile intensifying dialogues with potential partners for an upcoming phase 3 clinical study. Topline results of the phase 2b study are expected to be presented during Q4 of 2023.
In order to broaden the activities of the Company, Stayble intends to initiate another project utilizing STA363, directed towards the indication lumbar disc herniation (LDH). There are approximately 2.3 million chronic cases of lumbar disc herniation in EU4 (Germany, France, Italy and Spain), Great Britain, the US and Japan. Additionally, another 10 million patients are diagnosed with LDH annually in the same geographical areas, of which 1.5 million cases are classified as chronic. Based on the level of disc degeneration and the type of hernia, the Company assesses that approximately 60 percent of these are treatable by STA363. The Company intends to initiate a clinical phase 1b study for the LDH treatment during the first half of 2023.
Adding a second indication is an important addition to Stayble’s vision to establish itself as a major player among companies treating pain. With a second indication added to the portfolio, the Board considers Stayble better equipped for upcoming dialogues of partnership regarding upcoming studies and market launch, since the second indication both provides the opportunity to reach a larger market and spreads the risk related to the development of pharmaceuticals. As the treatment is based on a well-documented and body specific molecule, lactic acid, the Board both sees a competitive advantage as well as a low risk during development by utilizing this molecule.
Currently, the working capital is not estimated by the Board to be sufficient to cover the demands of the upcoming twelve-month period. The motive of the Rights Issue is to provide working capital in order to finance operating costs up to and including the first half of 2024. The proceeds of the Rights Issue are also intended to finance the initiation of a phase 1b study within the indication of LDH, concluding the current phase 2b study within the indication of DDD and prepare the organization for partnerships.
Overall milestones for the treatment of DDD
2023
- Q1 – Pre-IND meeting with FDA and scientific advice with Swedish MPA
- H1 – Expand team with CMO
- H2 – Intensive discussions of partnership
- Q4 – Topline results from ongoing phase 2b study
2024
- Q1 – Final trial report phase 2b study
- H1 – In-depth partnering discussions based on phase 2b data
- H1 – Follow-up meetings with FDA and its European counterpart EMA
- H2 – Detailed phase 3 planning via partnership
Overall milestones for the treatment of LDH
2023
- Q1 – Phase 1b study approved by authorities
- Q3 – First patient enrolled in phase 1b study
2024
- Q1 – Last patient enrolled in phase 1b study
- H1 – Topline results from phase 1b study
- H2 – Final trial report phase 1b study
- H2 – Regulatory advice with FDA and/or EMA
2025-2027
- Implementation of phase 2b study, possibly via partnership
Terms of the Rights Issue
Stayble’s Board of Directors today announced a Rights Issue consisting of a maximum of 19 781 320 newly issued shares with preferential rights for existing shareholders. The decision is subject to the approval of an extraordinary general meeting of shareholders. The Rights Issue, if fully subscribed, can provide the Company with a maximum amount of approximately 35,2 MSEK before deduction of transaction related costs. The public is also given the opportunity to participate in the Rights Issue.
Those who on the record date of March 21st 2023 are registered as shareholders in Stayble own preferential right to subscribe to shares in the current Rights Issue. For each existing share, one (1) subscription right is received. Seven (7) subscription rights entitle the holder to subscribe for ten (10) new shares. The subscription price has been determined to SEK 1.78 per new share.
Subscription of shares are to take place during the subscription period starting on March 24th 2023 up to and including April 12th 2023. Subscription rights which are not used during the subscription period become invalid and lose their value. Subscription rights are expected to be traded on Nasdaq First North Growth Market during the period March 24th 2023 up to and including April 5th 2023. Trading with BTA (Paid Subscribed Share) are expected to take place on Nasdaq First North Growth Market as of March 24th 2023 and will continued until the Swedish Companies Registration Office has registered the Rights Issue.
Fully subscribed, the Rights Issue is expected to result in an increase in the share capital of a maximum of SEK 2 571 571,60, from SEK 1 800 100,12 to a maximum of SEK 4 371 671,72, through the issue of a maximum of 19 781 320 new shares. After the Rights Issue, upon full subscription, the number of shares in Stayble will amount to a maximum of 33 628 244 shares. Existing shareholders who choose not to participate in the Rights Issue will be subject to a dilution effect corresponding to approximately 58.8 percent, calculated on the number of shares in the Company after the initial Rights Issue, upon full subscription. Shareholders who choose not to participate in the Rights Issue have the opportunity to partly compensate for the financial dilution effect by selling their subscription rights not later than April 5th 2023.
Complete terms and conditions for the Rights Issue as well as more information about the Company will be presented in the prospectus which is expected to be published on Stayble’s website (www.staybletherapeutics.com) around March 17th 2023. The information will also be available on Stayble’s webpage about the Rights Issue (www.foretradesemission.staybletherapeutics.se).
Underwriting and pre-subscription commitments
Approximately 11.7 percent (approximately MSEK 4.1) of the Rights Issue are covered by subscription commitments made by the Board of Directors, management, principal owner and other existent shareholders. Furthermore, the Company has received a so-called bottom-up underwriting commitment amounting to approximately 38.3 percent (approximately MSEK 13.5) of the Rights Issue and a so-called top-down underwriting commitment amounting to an additional approximately 30.0 percent (approximately MSEK 10.6) of the Rights issue from professional external investors. In total, up to 80 percent (approximately MSEK 28.2) of the Rights issue is thus covered by underwriting and pre-subscription commitments. For issued bottom-up underwriting commitments, a cash compensation of 12 percent of the amount guaranteed is paid, alternatively an optional compensation of 15 percent in the form of newly issued shares. For issued top-down underwriting commitments, a cash compensation of 15 percent of the amount guaranteed is paid, alternatively an optional compensation of 20 percent in the form of newly issued shares. In case the guarantors choose compensation in the form of shares, these will be received through a directed offset issue after the conclusion of the Rights Issue at the same price as shares in the Rights Issue. No compensation is provided for subscription commitments. Underwriting and subscription commitments are not secured by means of advance transactions, bank guarantees or similar.
Lock-up agreement
A number of members of the Board of Directors and management of the Company have together, through a so-called lock-up agreement, with Sedermera Corporate Finance AB as counterpart, undertaken, with customary exceptions, not to sell any existing shareholdings or such shareholdings that are received through subscription in the Rights Issue during a period of six months from the announcement of the Rights Issue. Existing shareholdings under lock-up corresponds to approximately 3.42 percent of the total number of shares before the Rights Issue.
Indicative timetable of the Rights Issue
Last day of trading in shares including the right to participate in the Rights Issue: March 17th 2023
Expected date when the Prospectus will be published: Around March 17th
First day for trading in shares excluding the right to participate in the Rights Issue: March 20th 2023
Record date for participation in the Rights Issue: March 21st 2023
Trading in subscription rights: March 24th 2023–April 5th 2023
Subscription period: March 24th 2023–April 12th 2023
Announcement of the final outcome of the Rights Issue: Approximately April 13th–17th 2023
Trading with BTA (Paid Subscribed Share): Starting on March 24th 2023 and will continue until the Swedish Companies Registration Office has registered the rights issue. The last day of trading with BTA will be announced in a separate press release after the Rights Issue is concluded
Advisors
In connection with the rights issue, Stayble has appointed Sedermera Corporate Finance AB as financial advisor and Markets & Corporate Law Nordic AB as legal advisor. Nordic Issuing AB is acting as issuing agent and Shark Communication AB has advice the Company concerning communication.
For more information
For more information about the rights issue, please contact:
Sedermera Corporate Finance AB
Phone: +46 40 615 14 10
E-mail: info@sedermera.se
För mer information about Stayble, please contact:
Andreas Gerward, CEO Stayble Therapeutics AB
Phone: +46 (0) 730 808 397
E-mail: @staybletherapetutics.com
This information is the type of information that Stayble Therapeutics AB is obliged to publish pursuant to the EU Market Abuse Regulation. The information was submitted for publication through the agency of the contact person set out above on February 22nd 2023.
About Stayble Therapeutics AB
Stayble is a clinical-stage pharmaceutical company developing the STA363 injection treatment for degenerative disc disease (DDD) and chronic disc herniation (LDH). Stayble's vision is to offer patients a simple and effective treatment that addresses the underlying cause of the patient's chronic pain and provides lasting pain relief and increased physical function. Aimed at patients who are not helped by physiotherapy and painkillers, the treatment is a single injection that is expected to last a lifetime and requires minimal rehabilitation. The company is now focused on clinical development and is currently conducting a Phase 2b clinical trial in DDD and a Phase Ib trial in LDH.
Svensk Kapitalmarknadsgranskning AB is the Company’s Certified Advisor.
IMPORTANT INFORMATION
This press release does not constitute an offer to sell or issue, or the solicitation of an offer to buy or aquire, or subscribe for, shares, subscription rights, paid subscribed share (“BTA”), warrants, newly issues shares or other securities in Stayble. Invitation to persons concerned to subscribe to shares will only be available through the EU Growth Prospectus which Stayble estimates to announce around March 17th 2023.
Neither shares, subscription rights, BTA, warrants, newly issues shares or other securities are recommended or approved by any American federral or state securities authority or supervisory authority. No shares, subscription rights, BTA, warrants, newly issues shares or other securities are registered or will be registered according to the United States Securities Act of 1933 in its current wording, or by any other admissible law in the United States, Australia, Japan, Canada, New Zeeland, South Africa, Hong Kong, Switzerland, Russia, Belarus or any other country where the Rights Issue or distribution of this press release violates Swedish law or regulations or requires the a further prospectus to be drafted, registered or any other measures to be taken except those required by Swedish law. The press release, as well as the prospectus, the registration form and other documents referring to the Rights Issue, are thus not permitted to distribute to or within any such jurisdiction.
This press release may contain forward-looking statements that reflect Stayble’s current view of future events as well as financial and operational development. Words such as “intend”, “assess”, “except”, “may”, “plan”, “estimate” and other expressions involving indications or predictions regarding future developments or trends, constitute forward-looking statements. Forward-looking statements by nature entail known as well as unknown risks and insecurities since they are dependent on future performance and circumstances. Forward-looking statements do not constitute any guarantee regarding future results or development and the actual results may significantly vary from what is stated in forward-looking statements.
This information, these opinions and these forward-looking statements found in this press release are only valid and this date and are subject to change without notice. Stayble makes no commitment to update or revise forward-looking statements, future events or similar circumstances except when required by applicable legislation.