TIDMFARN
RNS Number : 7496S
Faron Pharmaceuticals Oy
05 October 2017
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH
AFRICA, THE REPUBLIC OF IRELAND, NEW ZEALAND OR ANY OTHER
JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION
WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMATION,
OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE
OR DISPOSE OF ANY SECURITIES IN FARON PHARMACEUTICALS OY ("FARON")
OR ANY OTHER ENTITY IN ANY JURISDICTION. NEITHER THIS ANNOUNCEMENT
NOR THE FACT OF ITS DISTRIBUTION, SHALL FORM THE BASIS OF, OR BE
RELIED ON IN CONNECTION WITH ANY INVESTMENT DECISION IN RESPECT OF
FARON.
THE PROPOSED TRANSACTION REFERRED TO IN THIS ANNOUNCEMENT WOULD
BE MADE PURSUANT TO A PRIVATE PLACEMENT EXEMPTION UNDER THE
EUROPEAN DIRECTIVE 2003/71/EC (AND AMMENTS THERETO (THE "PROSPECTUS
DIRECTIVE"), AS IMPLEMENTED IN THE MEMBER STATES OF THE EUROPEAN
ECONOMIC AREA, FROM THE REQUIREMENTS TO PRODUCE A PROSPECTUS UNDER
THE PROSPECTUS DIRECTIVE FOR OFFERS OF SECURITIES. FARON HAS NOT
TAKEN ANY ACTION, NOR WILL IT TAKE ANY ACTION, TO OFFER ANY
SECURITIES OR ANY OTHER DOCUMENTS RELATING TO THE PROPOSED
TRANSACTION TO THE PUBLIC IN FINLAND, SWEDEN, NORWAY OR DENMARK, OR
IN ANY OTHER JURISDICTION IN ANY FORM WHICH WOULD CONSTITUTE AN
OFFER TO THE PUBLIC.
THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMED (THE
"SECURITIES ACT") OR UNDER THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED,
SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE
UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. THERE
IS NO PUBLIC OFFERING OF THE PLACING SHARES IN THE UNITED STATES,
THE UNITED KINGDOM OR ELSEWHERE. NO REPRESENTATION IS BEING MADE AS
TO THE AVAILABILITY OF ANY EXEMPTION UNDER THE SECURITIES ACT FOR
THE REOFFER, RESALE, PLEDGE OR TRANSFER OF THE PLACING SHARES. THE
PLACING SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE US
SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION
OR OTHER REGULATORY AUTHORITY IN THE UNITED STATES, NOR HAVE ANY OF
THE FOREGOING AUTHORITIES PASSED UPON ORORSED THE MERITS OF THE
PLACING OR THE ACCURACY OR ADEQUACY OF THIS ANNOUNCEMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED
STATES.
Faron Pharmaceuticals Oy
("Faron" or the "Company")
Proposed Placing and Subscription to raise up to GBP10.0
million
TURKU - FINLAND, 7.00 A.M. GMT, 5 October 2017 - Faron
Pharmaceuticals Oy ("Faron" or "Company") (LON: FARN), the clinical
stage biopharmaceutical company, is pleased to announce a proposed
placing of up to 1,123,750 new ordinary shares in the capital of
the Company (the "Placing Shares") and a proposed subscription of
up to 126,250 new ordinary shares in the capital of the Company
(the "Subscription Shares") at a price of 800 pence per share (the
"Issue Price") to raise, in aggregate, up to approximately GBP10.0
million before expenses.
KEY HIGHLIGHTS
-- Proposed conditional placing of up to 1,123,750 Placing
Shares with institutional and other investors ("Placing") and
conditional subscription of up to 126,250 Subscription Shares with
certain Scandinavian based investors and a Director
("Subscription"), each intending to invest at the Issue Price, in
order to raise, in aggregate, up to approximately GBP10.0 million
before expenses
-- The Placing Shares and Subscription Shares if subscribed for
in full will represent, in aggregate, approximately 4.3% of the
Company's registered number of shares as enlarged by the Placing
and Subscription
-- The Issue Price of 800 pence per share represents a discount
of 2.1% to the closing mid-market price of 817.5 pence on 4 October
2017, being the last practicable date prior to this
announcement
-- The net proceeds of the proposed Placing and Subscription (of
approximately GBP9.4 million if fully subscribed) would be used to
fund:
o the Company's Traumakine commercialisation preparations and
support the launch of an expanded access program for Traumakine on
the successful conclusion of the INTEREST trial
o the expedited expansion of the Clevegen clinical development
program and manufacturing of Clevegen GMP material
-- The proposed Placing and Subscription is to be implemented
through a private placement with a limited number of institutional
and other investors. It is expected that finalisation of the
proposed Placing and Subscription will commence immediately
following this announcement. As soon as practicable after the
Placing and Subscription have been finalised, a further
announcement will be made containing details of the final number of
Placing Shares and Subscription Shares to be issued at the Issue
Price by the Company (together with the approximate gross proceeds
of the Placing and Subscription). Further terms of the proposed
Placing and Subscription are set out below
-- Panmure Gordon (UK) Limited ("Panmure Gordon") is acting as
Sole Bookrunner and Corporate Broker to the Company and Cairn
Financial Advisers LLP ("Cairn") as Nominated Adviser to the
Company
Commenting on the proposed Placing and Subscription, Dr Markku
Jalkanen, CEO of Faron, said:
"Given the recent positive advice from the FDA, Faron is now
rapidly preparing to become a commercialisation-stage company
moving its focus for Traumakine towards the market. This funding
round will help us to commence commercialisation preparations ahead
of read-out from the INTEREST trial and expedite our clinical
development activities for Clevegen(R). We are very excited about
the value inflection horizon for Faron and are determined to bring
our important and life-changing products to patients as quickly as
possible."
REASONS FOR THE PROPOSED PLACING AND SUBSCRIPTION
Support the Company's preparation for the commercialisation of
Traumakine
-- Traumakine(R) , the Company's lead product, could be the
first ever drug for Acute Respiratory Distress Syndrome (ARDS) upon
approval with blockbuster potential.
-- In anticipation of the pivotal clinical results for its
INTEREST Phase III study for Traumakine for the treatment of ARDS,
and following advice from the FDA that Faron can proceed directly
to Biologics License Application (BLA) submission pending positive
results from its two on-going Phase III trials, the Company wishes
to accelerate the preparation for the commercialisation of
Traumakine by raising capital to support the outsourcing costs
related to preparation of the BLA for FDA and the Marketing
Authorisation Application (MAA) for EMA in collaboration with a
global commercial service house.
o Faron anticipates that recruitment of the targeted 300
patients to the INTEREST Phase III trial will complete during the
fourth quarter of 2017. Subject to positive results, the Company
will submit its conditional MAA filing. Any requirement for a
second Phase III trial will be determined by the EMA following
analysis of the primary endpoint of the INTEREST Phase III trial,
and would likely include an interim stop for early efficacy if the
trial is required.
-- Faron plans to initiate an expanded access program for
Traumakine to start once the INTEREST trial is closed to new
patients, and will utilise additional working capital from the
Placing and Subscription to create the infrastructure for this
expanded access program and support the supply of Traumakine to its
participants. This will allow compassionate use of Traumakine in
eligible named patients at European and North-America intensive
care unit (ICU) hospitals who may benefit from Traumakine treatment
ahead of the product's potential regulatory approval, in addition
to generating late phase data on the benefit of the treatment
outside a clinical trial.
Advance the clinical development of Clevegen(R) in several
indications
-- In advance of the Company's first clinical trial program in
cancer patients for Clevegen(R) , its novel immune switch antibody,
which is expected to commence in 2018, the Directors require
additional capital in order to undertake the first full scale GMP
production of Clevegen.
-- Faron intends to expedite the expansion of its planned
Clevegen clinical development program in several solid tumours
(liver, pancreas, ovarian and melanoma) in order to obtain
accelerated safety and clinical data read-outs, with the protocol
design to be submitted to the UK regulatory authorities MHRA later
this year.
-- The Directors believe that Clevegen's ability to remove local
immune suppression by targeting pro-tumoural type-2 macrophages,
while leaving intact the type-1 macrophages that support immune
activation against tumours, could help the human body's own immune
system to combat cancer.
DETAILS OF THE PROPOSED PLACING AND SUBSCRIPTION AND ISSUE OF
EQUITY
Subject to the Placing Shares and Subscription Shares being
subscribed for in full, they are to be issued by the Company
pursuant to the Directors' existing authority to allot ordinary
shares in the capital of the Company ("Ordinary Shares") for cash
on a non-pre-emptive basis, as approved by shareholders at the
Company's last annual general meeting which was held on 16 May
2017. The Company has received non-binding indications of interest
from potential institutional investors and a Director for the
Placing and Subscription during a pre-marketing process.
In connection with the proposed Placing, the Company has entered
into a placing agreement with Panmure Gordon and Cairn (together
the "Placing Advisers") (the "Placing Agreement"). Pursuant to the
terms of the Placing Agreement, Panmure Gordon has agreed to use
its reasonable endeavours to procure placees for the Placing Shares
at the Issue Price. The Placing is conditional upon, inter
alia:
-- the Placing Agreement having become unconditional in all respects;
-- the Company having performed, in all material respects, its
obligations under the Placing Agreement and not being in material
breach of the Placing Agreement;
-- legally binding commitments being received in respect of all
of the Placing Shares and the Subscription Shares (the "Placee
Condition"); and
-- the Placing Shares and the Subscription Shares being issued
and being registered at the Finnish Trade Registry (the "Issue
Condition").
The Placing is being implemented through a private placement
with a limited number of institutional and other investors. The
Placing Agreement contains customary warranties and an indemnity
from the Company in favour of the Placing Advisers together with
provisions which enable the Placing Advisers to terminate the
Placing Agreement in certain circumstances before satisfaction of
the Issue Condition in respect of each stage of the Placing,
including where there has been a material breach of any of the
warranties in the reasonable opinion of any Placing Adviser or
where there is a material adverse change in the business or
financial affairs of the Company. The Company has agreed to pay
Panmure Gordon and Cairn certain commissions and fees for their
respective appointments in connection with the Placing. In order to
comply with local securities law in Finland, the Issue Condition
will be satisfied prior to Admission. Accordingly, pursuant to the
terms of the Placing Agreement, Panmure Gordon has agreed to
underwrite the subscription for and payment to the Company of the
Issue Price for the Placing Shares upon satisfaction of the Placee
Condition.
Assuming that the Placing Shares and Subscription Shares ("New
Shares") are subscribed for in full, the Placing and Subscription
is expected to be effected in two stages in anticipation of
allowing investments made by certain venture capital trust and
enterprise investment scheme funds, (the "VCT Investors" and the
"EIS Investors" respectively) to qualify under VCT and EIS
legislation. Certain of the Placing Shares, including those to be
issued to the VCT Investors and the EIS Investors, and certain of
the Subscription Shares are expected to be issued (the "First Issue
Shares") and an application made for admission of the First Issue
Shares to trading on AIM ("Admission"). It is expected that
Admission of the First Issue Shares will become effective and that
dealings in the First Issue Shares will commence on or around 8.00
a.m. on 11 October 2017. A further announcement will be made to
confirm the outcome of the Placing and Subscription (subject to,
inter alia, satisfaction of the Issue Condition and Admission) and
to confirm the application has been made to AIM for the Admission
of the First Issue Shares in due course, but by no later than 4.30
p.m. on 9 October 2017.
Immediately following Admission of the First Issue Shares, the
remaining Placing Shares and Subscription Shares are expected to be
issued (the "Second Issue Shares") and an application will be made
for Admission of the Second Issue Shares. It is expected that
Admission of the Second Issue Shares will become effective and that
dealings in the Second Issue Shares will commence on or around 8.00
a.m. on 13 October 2017. The issue and allotment of the Second
Issue Shares is conditional upon, inter alia, Admission of the
First Issue Shares taking place, the Issue Condition relating to
the Second Issue Shares being satisfied and the Placing Agreement
otherwise remaining in full force and no material breach of its
terms having occurred. A further announcement will be made to
confirm Admission of the First Issue Shares and to confirm the
application has been made to AIM for the Admission of the Second
Issue Shares.
The Board believes this fundraise will enhance working capital
to support the Company's corporate strategy to maximise shareholder
value in the longer term, and accordingly will continue to evaluate
funding options over the medium term.
MARKET ABUSE REGULATION
Market Soundings, as defined in the Market Abuse Regulation
("MAR"), were taken in respect of the proposed Placing and
Subscription with the result that certain persons became aware of
inside information, as permitted by MAR. That inside information in
relation to the Placing and Subscription is set out in this
announcement and has been disclosed as soon as possible in
accordance with paragraph 7 of article 17 of MAR. Therefore, those
persons that received inside information in a Market Sounding are
no longer in possession of inside information relating to the
Company and its securities.
Panmure Gordon (UK) Limited, which is regulated in the UK by the
Financial Conduct Authority, is acting as sole bookrunner and
corporate broker to the Company and no one else in connection with
the Placing. Accordingly, it will not be responsible to any person
other than the Company for providing the regulatory and legal
protections afforded to its clients nor for providing advice in
relation to the contents of this Announcement or any matter,
transaction or arrangement referred to in it.
Cairn Financial Advisers LLP, which is regulated in the UK by
the Financial Conduct Authority, is acting as nominated adviser for
the Company and no one else in connection with the Placing.
Accordingly, it will not be responsible to any person other than
the Company for providing the regulatory and legal protections
afforded to its clients nor for providing advice in relation to the
contents of this Announcement or any matter, transaction or
arrangement referred to in it.
S
For more information please contact:
Faron Pharmaceuticals Oy
Dr Markku Jalkanen, Chief Executive Officer
E-mail: investor.relations@faron.com
Consilium Strategic Communications
Mary-Jane Elliott, Chris Welsh, Philippa Gardner, Lindsey
Neville
Phone: +44 203 709 5700
E-Mail: faron@consilium-comms.com
Westwicke Partners, IR (US)
Chris Brinzey
Phone: +1 339 970 2843
E-Mail: chris.brinzey@westwicke.com
Cairn Financial Advisers LLP, Nominated Adviser
Emma Earl, Tony Rawlinson
Phone: +44 207 213 0880
Panmure Gordon (UK) Limited, Sole Bookrunner and Corporate
Broker
Freddy Crossley, Duncan Monteith (Corporate Finance)
Tom Salvesen (Corporate Broking)
Phone: +44 207 886 2500
Whitman Howard Limited, Joint Corporate Broker
Ranald McGregor-Smith, Francis North
Phone: +44 207 659 1234
About Faron Pharmaceuticals Ltd
Faron (AIM:FARN) is a clinical stage biopharmaceutical company
developing novel treatments for medical conditions with significant
unmet needs. The Company currently has a pipeline focusing on acute
organ traumas, vascular damage and cancer immunotherapy. The
Company's lead candidate Traumakine, to prevent vascular leakage
and organ failures, is currently the only treatment for Acute
Respiratory Distress Syndrome (ARDS) undergoing Phase III clinical
trials. There is currently no approved pharmaceutical treatment for
ARDS. An additional European Phase II Traumakine trial is underway
for the Rupture of Abdominal Aorta Aneurysm ("RAAA"). Faron's
second candidate Clevegen is a ground breaking pre-clinical
anti-Clever-1 antibody. Clevegen has the ability to switch immune
suppression to immune activation in various conditions, with
potential across oncology, infectious disease and vaccine
development. This novel macrophage-directed immuno-oncology switch
called Tumour Immunity Enabling Technology ("TIET") may be used
alone or in combination with other immune checkpoint molecules for
the treatment of cancer patients. Faron is based in Turku, Finland.
Further information is available at www.faron.com
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identified by their use of terms and phrases such as "believe",
"could", "should", "expect", "envisage", "estimate", "intend",
"may", "plan", "potentially", "will" or the negative of those,
variations or comparable expressions, including references to
assumptions. These forward looking statements are not based on
historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of
operations, performance, future capital and other expenditures
(including the amount, nature and sources of funding thereof),
competitive advantages, business prospects and opportunities. Such
forward looking statements reflect the Directors' current beliefs
and assumptions and are based on information currently available to
the Directors.
A number of factors could cause actual results to differ
materially from the results and expectations discussed in the
forward looking statements, many of which are beyond the control of
the Company. In particular, the outcome of clinical trials
(including, but not limited to the Company's INTEREST trial) may
not be favourable or clinical trials over and above those currently
planned may be required before the Company is able to apply for
marketing approval for a product. In addition, other factors which
could cause actual results to differ materially include risks
associated with vulnerability to general economic and business
conditions, competition, environmental and other regulatory
changes, actions by governmental authorities, the availability of
capital markets, reliance on key personnel, uninsured and
underinsured losses and other factors. Although any forward looking
statements contained in this announcement are based upon what the
Directors believe to be reasonable assumptions, the Company cannot
assure investors that
actual results will be consistent with such forward looking
statements. Accordingly, readers are cautioned not to place undue
reliance on forward looking statements. Subject to any continuing
obligations under applicable law or any relevant AIM Rule
requirements, in providing this information the Company does not
undertake any obligation to publicly update or revise any of the
forward looking statements or to advise of any change in events,
conditions or circumstances on which any such statement is
based.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IOEEAFELEFEXFAF
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October 05, 2017 02:00 ET (06:00 GMT)
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