Shares of BeyondSpring (NASDAQ:BYSI) -- a clinical-stage biopharmaceutical company -- are down by 18.1% as of 11:26 a.m. EDT on Friday, following the drugmaker's announcement of the pricing of a public offering of ordinary shares. With the company set to dilute existing shareholders, it isn't surprising that its stock plummeted today.
BeyondSpring first announced it was initiating a public offering of ordinary shares on Thursday. Today the company announced that it was selling 1,930,000 ordinary shares for $13 per share. BeyondSpring is giving underwriters a 30-day option to purchase an additional 289,500 shares. Also, the company said that it would sell 384,615 shares to an investment firm called Decheng Capital (and its affiliates) in a separate private offering. BeyondSpring expects the proceeds from this public offering to total about $30.1 million. Note that BeyondSpring's shares closed at about $16.60 on Thursday. At writing, the company's shares are down to $13.72 apiece.
BeyondSpring currently has no approved products on the market, and the company does not generate any revenue. During the first quarter, BeyondSpring reported a net loss of $16.7 million and a cash balance of $24.9 million as of March 31. The healthcare company intends to use the proceeds from its public offering of ordinary shares to "support the commercialization of Plinabulin," its most advanced pipeline candidate.
Plinabulin is being investigated for the prevention of chemotherapy-induced neutropenia (CIN) in combination with Neulasta, a bone marrow stimulant marketed by Amgen (NASDAQ:AMGN). BeyondSpring plans on submitting a New Drug Application to the U.S. Food and Drug Administration for Plinabulin by year end.