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BioCryst Plans to Raise $100 Million

By Brian Orelli, PhD – May 27, 2020 at 6:21PM

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Launching a drug is expensive.

On the cusp of launching berotralstat as a treatment for hereditary angioedema in the U.S. and EU, BioCryst Pharmaceuticals (BCRX -2.68%) is planning to sell $100 million of stock in a secondary offering. The underwriters will have a 30-day option to purchase another $15 million, so the biotech could potentially gross $115 million in the offering.

BioCryst ended the first quarter with $115 million in the bank, having burned through $23 million during the first quarter, so the capital raise shouldn't come as much of a surprise, although it could have waited until later in the year to do it.

Of course, with shares up 142% since BioCryst announced last month that it was testing its antiviral medication galidesivir in patients with COVID-19, now seems like as good a time as any to grab some additional cash.

Magnifying glass and pen on a balance sheet

Image source: Getty Images.

BioCryst plans to use the capital for pre-launch and commercial activities for berotralstat. The Food and Drug Administration is supposed to make a decision about the marketing application on or before Dec. 3. And a decision in the EU is expected in the first half of next year.

The company also plans to use some of the capital to develop BCX9930 for complement-mediated diseases and for post-approval studies for its flu medication Rapivab that regulators are making the company run.

BioCryst was trading down 4% in after hours trading on the news of the secondary offering that will dilute shareholders by about 13%. The price of the shares being sold in the secondary offering hasn't been set yet.

Brian Orelli and The Motley Fool have no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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