Paradigm Biopharmaceuticals Ltd (ASX:PAR) has placed A$35 million in shares to leading Australian and international institutional and sophisticated investors with bids received exceeding the size of the placement.
The placement was priced at $1.30 per share, which represents a 23.1% discount to Paradigm’s last trading price of $1.69 per share.
Proceeds will be applied to costs of the second Phase 3 osteoarthritis (OA) clinical trial and leaves Paradigm fully-funded through to completion of this trial for which readout is expected to take place in late 2022.
"Endorsement" of PAR
Paradigm chief executive officer Paul Rennie said the receipt of firm commitments for the placement indicated the growing confidence in Zilosul in the treatment of OA along with Paradigm’s pathway to regulatory approval and commercialisation.
He said: “The strong support shown by leading institutional investors both domestic and international, is a huge endorsement of the company and its aim of developing and commercialising safe and effective treatment for sufferers of osteoarthritis.”
Completion of the placement is expected to occur on or around Wednesday, April 15, 2020.
Rennie said: “The proceeds from the placement will ensure the company is fully-funded through the completion of the Phase 3 trial and ensure we can be singularly focused on executing the trial and delivering outcomes for patients in this very large and growing market.”
Path to regulatory approval
The capital raising enables Paradigm to focus on the clear path to regulatory approval and commercialisation.
PAR recently received clear guidance from the US Food and Drug Administration (FDA) around the primary and secondary endpoints for its Phase 3 OA trial.
This guidance includes the number of phase three studies required for registration and overall clarity and guidance for the requirements of Phase 3 clinical trial design and new drug application submission.