Noxopharm has secured commitments for a $1.5 million placement and will offer existing shareholders up to a further $1 million to fund the next clinical study of SOF-SKN, its topical therapy for cutaneous lupus erythematosus.
The company said it had received commitments from new and existing professional and sophisticated investors at 4.2 cents a share. The price was a 19.2 per cent discount to the last traded price on Monday 26 October and a 22.6 per cent discount to the 15-day volume-weighted average price. About 35.7 million new shares will be issued under the placement.
Chairman Fred Bart subscribed for $375,000 of the placement. His participation needs shareholder approval at an extraordinary general meeting expected in mid-December.
Alongside the placement, Noxopharm has agreed to the early conversion of $3.78 million of shareholder convertible notes, including capitalised interest, on the same terms as the placement. This is 87 per cent of the notes on issue and will mean about 90 million new shares, subject to shareholder approval at the same meeting.
"We are grateful for the strong support received from new and existing shareholders. Our Sofra technology platform has the potential to generate multiple new drugs across a range of diseases, creating significant opportunities to expand our pipeline in global markets and deliver long-term value for our shareholders," Mr Bart said.
Chief executive Dr Olivier Laczka said the timing mattered for the company. "With our lead program (SOF-SKN) approaching its next stage of clinical evaluation, the Equity Raising and early Note conversion comes at an important time for Noxopharm. This process capitalises the company to deliver key near-term catalysts, and allows us to advance lead clinical and R&D programs developed on our proprietary Sofra platform."
The share purchase plan is priced the same as the placement. It is open to shareholders with a registered address in Australia or New Zealand who held shares on the record date of Friday 30 October. They can apply for up to $30,000 of shares without brokerage, and Noxopharm may scale back applications if the plan is oversubscribed.
Investors in the placement and the share purchase plan will receive one free attaching option for each new share. These options can be exercised at 4.2 cents and expire on 1 November 2027. Each attaching option that is exercised brings a further piggyback option at 6.3 cents, which expires on 1 November 2029. Both classes need shareholder approval, and Noxopharm will seek to have them quoted on the ASX.
PAC Partners Securities was lead manager and bookrunner. It will receive a fee of 6 per cent of gross proceeds and, subject to shareholder approval, one option for every four placement shares issued. Those options can be exercised at 6.3 cents over three years.
Together with an expected $1.4 million research and development tax incentive for the 2026 financial year, Noxopharm said the money will fund the SOF-SKN extension study in cutaneous lupus patients, due to start in the first quarter of 2027. It will also cover work towards an Investigational New Drug application for a planned Phase 2 trial and preclinical studies, including in vivo work, for the SOF-CAN and SOF-VAC programs. The remainder will go to working capital, repaying shareholder loans and the balance of the notes, and the costs of the offer.
Cutaneous lupus is an autoimmune disease that shows up in the skin. No therapies are specifically approved for it. Noxopharm says this leaves a significant unmet need and a chance for Orphan Drug Designation. It also points to expansion into nearby skin diseases, a market it estimates will be worth about US$55 billion by 2034.