Botanix Pharmaceuticals Raises A$40 Million to Advance CBD-Based Dermatology Drug Pipeline

On July 31, 2019, VCBeat (WeChat ID: vcbeat) learned from foreign media reports that biopharmaceutical company Botanix announced it had received share placement commitments from U.S. institutional investors, including a specialized biotechnology investment fund based in the United States and leading institutional investors. The fundraising amounted to approximately AUD 40 million, which will be used to advance the research and development of cannabidiol (CBD)-based drugs for the treatment of skin diseases.

With strong support from U.S. institutional investors, including specialized biotechnology investment funds and major institutional investors, Botanix issued ordinary shares at an offering price of AUD 0.21 per share. Cowen and Company served as the lead placement agent for this offering. The Australian tranche of the offering was co-managed by Argonaut Securities Pty Ltd and Bell Potter Securities Ltd.

Upon completion of this placement, Botanix will have approximately 200 million shares on issue, at an issue price of A$0.21 per share. This represents a 16.7% discount to the acquisition price of A$0.252 per share, based on the closing price on July 29, 2019. All newly issued placement shares will rank pari passu with existing ordinary shares.

This placement will be conducted within Botanix’s existing placement capacity, with approximately 77 million shares to be issued under ASX Listing Rule 7.1A and the remaining 113 million shares under ASX Listing Rule 7.1. Shareholder approval is not required for this placement. The offer price of AUD 0.21 per share complies with the requirements of Listing Rule 7.1A. Settlement of the placement is expected to occur on Tuesday, 6 August 2019, with quotation and trading of the new shares commencing on Wednesday, 7 August 2019.

The proceeds from this placement will enable Botanix to continue executing its key clinical development programs and accelerate its commercialization strategy. Botanix is now fully funded to advance the development of its antimicrobial portfolio into clinical studies and to conduct supporting research. These studies will be conducted prior to the initiation of Phase 3 trials for BTX 1503 (acne) and BTX 1204 (atopic dermatitis). Botanix remains on track to complete the Phase 2 study of BTX 1503 in the third quarter of 2019 and the Phase 2 study of BTX 1204 in the fourth quarter. The proceeds from the placement may also be used for the company’s general corporate purposes.

Botanix has also appointed Richard Peterson as Chief Financial Officer and Howie McKibbbon as Chief Commercial Officer. These two new appointments significantly strengthen the company’s executive management team, bringing valuable leadership experience, business acumen, and industry expertise to drive Botanix’s next phase of growth.

Vince Ippolito, Executive Chairman and President of Botanix, stated, “The multiple research datasets we recently released have garnered significant global attention. This creates an opportunity for Botanix to further explore the application of cannabinoids in dermatology. Support from U.S. institutional investors enables Botanix to advance to the next stage. These investors possess substantial experience in dermatology and pharmaceutical investments.”

Headquartered in Perth, Australia, with a branch office in Philadelphia, United States, Botanix is a clinical-stage cannabinoid company focused on developing safe and effective therapeutics for dermatological conditions such as acne vulgaris, psoriasis, and atopic dermatitis, as well as a platform for the development of candidate antimicrobial agents. The active ingredient in Botanix’s products is synthetic cannabidiol (CBD). The dermatological conditions targeted by the company involve inflammation, skin barrier impairment, keratinocyte proliferation, pruritus, seborrhea, and bacterial infection.

(Compiled by Cheng Tao)