Heat Biologics is pressing forward with a stock offering expected to raise about $6.8 million—a little more than half of the target the cancer immunotherapy developer set in January but enough to advance its clinical programs to a point where they can report data.
Durham, NC-based Heat (NASDAQ: HTBX) priced the offering of 9.1 million shares of common stock at 75 cents per share. Each common stock share comes with a warrant to purchase another 0.75 of a share. The warrants expire five years after they are issued and will have an exercise price of $1 per share.
Investors frowned on the securities offering, sending Heat’s stock price down more than 62 percent to 71 cents per share on Friday morning.
Heat has developed a cancer immunotherapy platform technology it calls Immune Pan-Antigen Cytotoxic Therapy, or “ImPACT.” The technology prompts the body’s immune system to recognize and fight cancer by introducing antigens that share the characteristics of cancer cells.
Heat plans to use proceeds from the stock sale to complete its Phase 2 trial of its bladder cancer immunotherapy, HS-410. That 75-patient trial is evaluating the Heat therapy in combination with bacillus Calmette-Guerin vaccine, an old tuberculosis treatment that is also the standard of care for early-stage bladder cancer. The primary goal of the trial is one year of disease-free survival. Heat is also evaluating how its bladder cancer treatment works on its own. That study is being conducted in a separate group of 17 patients.
Remaining funds will be used to take a lung cancer immunotherapy, HS-110, far enough for the Phase 1b trial to report topline data.
The plans fall short of what the company said in January that it hoped to do by raising up to $12.5 million. With that amount of money, Heat said it expected it would be able to start preparing for late-stage clinical trials for its bladder cancer treatment. In documents filed with securities regulators, Heat says data for its bladder cancer studies, as well as its lung cancer study, are expected in the fourth quarter of this year. Heat expects its securities offering will close on March 23.
Image of a healthy T cell courtesy of the NIAID via a Creative Commons license.