Novavax (NASDAQ:NVAX) retreated in premarket trading after the clinical-stage vaccine company said it will offer $200mln in convertible senior unsecured notes due to mature on February 1, 2023.
Shares fell as much as 7% as of 8:08 a.m. in New York on Monday. The stock has lost 43% over the past six months through the close on Friday.
Novavax intends to use the net proceeds to advance its clinical-stage vaccine candidates, the Gaithersburg, Maryland-based company said in a statement on Monday.
That includes its recently initiated pivotal Phase 3 clinical trials of its RSV F Vaccine in older adults and pregnant women, as well as its other clinical and preclinical research programs, and general corporate purposes.
Novavax will also use a portion of the net proceeds from the offering to pay the cost of certain capped call transactions.
Novavax also expects to grant the initial purchasers of the notes an option to purchase up to an additional $30mln aggregate principal amount of the notes.
“The purpose of this offering and the rationale for a convertible note is to strengthen the balance sheet while minimizing dilution,” CEO Stanley Erck said in the statement.
“If completed, this offering will enhance our balance sheet as we engage potential partners in discussions on RSV F Vaccine commercialization rights outside North America and support our aggressive development and U.S. commercialization plans.”
While Novavax has not finalized its full financial results for the 2015 fiscal year, Novavax expects to report that it has $231mln of cash, cash equivalents and marketable securities as of December 31, 2015.