Elutia Announces Private Placement for Proceeds Up to $26 Million
19 September 2023 - 2:36PM
Elutia Inc. (Nasdaq: ELUT) (“Elutia”), a company pioneering
drug-eluting biomatrix products, today announced that it has
entered into a securities purchase agreement for a private
placement (PIPE) financing that is expected to result in initial
gross proceeds to the Company of approximately $10.5 million,
before deducting offering expenses. The full exercise of warrants
included in the financing would add $15.8 million, for total gross
proceeds of $26.2 million. Cash raised from the PIPE financing and
the Orthobiologics business unit divestiture, announced yesterday,
will support the Company’s advancement of its drug-eluting
biomatrix products for the cardiac pacemaker and defibrillator
market and breast reconstruction post-mastectomy.
“We appreciate the support of our investors,
demonstrating the high value of our platforms and technology for
patient care,” said Dr. Randy Mills, President and Chief Executive
Officer of Elutia. “The combined proceeds from our Orthobiologics
divestiture and today’s financing potentially adds more than $60
million in cash to our balance sheet, materially strengthening our
financial position and extending our cash runway. We remain
well-positioned to execute on our upcoming program milestones
involving CanGaroo® for device protection and SimpliDerm® for
breast reconstruction.”
The private placement financing included
participation by existing investor HighCape Capital and new
investors Nantahala Capital and a life-sciences focused investment
fund. Lake Street Capital Markets, LLC is acting as the exclusive
placement agent for the transaction.
Pursuant to the securities purchase agreement,
Elutia is selling an aggregate of 7,355,869 shares of the Company’s
common stock (or pre-funded warrants) and 11,033,804 warrants to
purchase common stock (or pre-funded warrants) at a price of
$1.4275 per share and associated warrants (less $0.001 in the case
of pre-funded warrants), priced at-the-market. Each common stock
purchase warrant is exercisable at $1.4275 per share at any time
until the earlier of: a) 30 trading days after the FDA clearance of
the Company’s CanGaroo®RM antibiotic-eluting biologic envelope or
b) five years from the date of issuance.
In connection with the securities purchase
agreement, the Company entered into a registration rights agreement
pursuant to which the Company has agreed to subsequently file a
registration statement to register for resale the common stock
purchased in the transaction and the common stock underlying the
prefunded warrants and warrants.
The closing of the transaction is subject to
certain conditions and is expected to occur on September 21,
2023.
The offer was, and sale of the foregoing
securities are being, made in a transaction not involving a public
offering, and have not been registered under the Securities Act of
1933, as amended (the “Securities Act”), or applicable state
securities laws. The securities will be sold in a private placement
exempt from the Securities Act. The securities being issued in the
private placement may not be offered or resold in the United States
absent registration or pursuant to an exemption from the
registration requirements of the Securities Act and applicable
state securities laws. The Company has agreed to file a
registration statement covering the resale of the shares of common
stock acquired by investors, or underlying warrants acquired by
investors, in the private placement.
This press release does not constitute an offer
to sell or the solicitation of an offer to buy the securities in
any jurisdiction, nor shall there be any sale of the securities in
any state in which such offer or sale would be unlawful prior to
the registration or qualification under the securities laws of such
state. Any offering of the securities under the resale registration
statement will only be by means of a prospectus.
About Elutia
Elutia develops and commercializes biologic
products to improve compatibility between medical devices and the
patients who need them. With a growing population in need of
implantable technologies, Elutia’s mission is humanizing medicine
so patients can thrive without compromise. For more information,
visit www.Elutia.com.
Forward-Looking Statements
This press release contains “forward-looking
statements” within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. Forward-looking statements can be identified
by words such as “projects,” “may,” “will,” “could,” “would,”
“should,” “believes,” “expects,” “anticipates,” “estimates,”
“intends,” “plans,” “potential,” “promise” or similar references to
future periods. All statements contained in this press release that
do not relate to matters of historical fact should be considered
forward-looking statements, including any statements and
information concerning our expectations for closing of our private
placement, our focus on drug-eluting biomatrix technology aimed at
improving surgical outcomes or our milestones for our CanGaroo® and
SimpliDerm® products. Forward-looking statements are based on
management’s current assumptions and expectations of future events
and trends, which affect or may affect our business, strategy,
operations or financial performance, and actual results may differ
materially from those expressed or implied in such statements due
to numerous risks and uncertainties. Forward-looking statements are
inherently subject to risks and uncertainties, some of which cannot
be predicted or quantified, and other important factors that may
cause actual results, performance or achievements to differ
materially from those contemplated or implied in this press
release, including, but not limited to: risks associated with
shifting focus to our drug-eluting biomatrix solutions in the
cardiovascular and breast reconstruction areas and away from our
Orthobiologics business; risks regarding the ability to
successfully execute or realize the anticipated benefits under our
distribution arrangements with LeMaitre Vascular and Sientra; our
inability to generate sufficient revenue to achieve or sustain
profitability; adverse changes in economic conditions and
instability and disruption of credit markets; our ability to
continue as a going concern; our ability to successfully execute or
achieve expected benefits from the divestiture of our
Orthobiologics business; closing our divestiture of our
Orthobiologics business; our products and our ability to enhance,
expand, develop and commercialize our product offerings; the impact
on our business of the recall of a single lot of our FiberCel
product and the discontinuation of its sales by our distribution
partner; consequences of our recall of a single lot of one of our
viable bone matrix products and market withdrawal of all of our
viable bone matrix products; our dependence on our commercial
partners; the impact of the bankruptcy of Surgalign Holdings, Inc.,
a significant customer of the Company, on our future revenues;
physician awareness of the distinctive characteristics, and
acceptance by the medical community, of our products; the ability
to obtain regulatory approval or other marketing authorizations;
and our intellectual property rights, and other important factors
which can be found in the “Risk Factors” section of Elutia’s public
filings with the Securities and Exchange Commission (“SEC”),
including Elutia’s Annual Report on Form 10-K for the year ended
December 31, 2022, as such factors may be updated from time to time
in Elutia’s other filings with the SEC, including Elutia’s
Quarterly Reports on Form 10-Q, accessible on the SEC’s website at
www.sec.gov and the Investor Relations page of Elutia’s website at
https://investors.elutia.com. Because forward-looking statements
are inherently subject to risks and uncertainties, you should not
rely on these forward-looking statements as predictions of future
events. Any forward-looking statement made by Elutia in this press
release is based only on information currently available and speaks
only as of the date on which it is made. Except as required by
applicable law, Elutia expressly disclaims any obligations to
publicly update any forward-looking statements, whether written or
oral, that may be made from time to time, whether as a result of
new information, future developments or otherwise.
Investors:Matt SteinbergFINN
Partnersmatt.steinberg@finnpartners.com
Elutia (NASDAQ:ELUT)
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