Synairgen Announces Funding Round for SNG001 Phase II Trial Amidst Share Price Drop
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Synairgen (search) plans to raise up to £19 million to fund a Phase II study of its respiratory drug treatment, SNG001, with major shareholder TFG Asset Management (search) underwriting £18 million.
The funding is contingent on a placing and open offer raising at least £2.9 million; failure to do so will result in cancellation of the AIM quotation.
Synairgen (search)'s share price plummeted by 54.4% to 2p following the announcement of the funding round and its terms.
Synairgen (search) (LON: SNG) has announced plans to raise up to £19 million through a share placement and open offer, primarily to fund a Phase II clinical trial for its respiratory drug treatment, SNG001. The announcement comes as the company's share price experienced a significant drop of 54.4%, settling at 2p.
The funding initiative involves a conditional underwriting commitment of £18 million from Synairgen (search)'s largest shareholder, TFG Asset Management (search). However, this commitment is contingent upon the success of a placing and open offer aimed at raising £6 million. The TFG subscription will be reduced by the amount raised over £1 million through the placing and open offer.
A critical condition for the funding is that the placing and open offer must raise at least £2.9 million. Failure to meet this threshold will lead to the cancellation of Synairgen (search)'s AIM quotation, posing a significant risk to the company's listing status.
SNG001 is Synairgen (search)'s lead drug candidate, a formulation of interferon beta for the treatment of respiratory viral infections (search). The planned Phase II study aims to further evaluate its efficacy and safety in a specific patient population. Details regarding the trial design, endpoints, and patient selection criteria were not disclosed in the announcement but are expected to be released as the study progresses.
The current financial situation and the terms of the funding round reflect the challenges faced by Synairgen (search) in advancing its clinical programs. The company's ability to secure the necessary funding and successfully execute the Phase II trial will be crucial for the future development of SNG001 and its potential to address unmet needs in respiratory disease treatment.