Paradigm Biopharmaceuticals (ASX:PAR) has announced that it has received firm commitments for a capital raising totalling $16 million through a placement of fully paid ordinary shares to sophisticated and institutional investors.
The company said the funds will support its Phase 3 clinical, including global start-up, site initiation commencing firstly in Australia and other strategic initiatives.
The $16 million placement of 40 million shares is priced at $0.40 each.
The Phase 3 trial will involve patients with a clinical and radiographic knee osteoarthritis (OA) diagnosis. Patients will have knee OA pain unresponsive to conservative nonpharmacologic and pharmacologic therapy. The study objective is to demonstrate the improvement in pain and function with subcutaneous injections of pentosan polysulfate sodium (iPPS) compared with subcutaneous placebo injections.
Paradigm managing director Paul Rennie said, “The capital raise, priced at $0.40, represents a 3% premium to the 30 VWAP [volume-weighted average price]. The size of the raise of $16M provides Paradigm with sufficient cash reserves to commence the start-up of the Phase 3 clinical trial and working capital into 2H CY2025.
"We received support from our current and new investors which highlights the strength of our clinical programs and positions Paradigm to immediately advance our global phase 3 clinical trial setup and deliver on critical milestones.
"We chose to reward all shareholders with a loyalty option with the record date likely to be mid – late January 2025. 2024 has been an important year of dealing with regulatory agencies and now we are looking forward to the execution of our phase 3 clinical trials to move ever closer to bringing iPPS to those suffering seriously debilitating pain and dysfunction. We are grateful for the continued support and enthusiasm of our shareholders."