VANCOUVER and HOUSTON, Aug. 23,
2019 /CNW/ - ESSA Pharma Inc. (NASDAQ: EPIX; TSXV: EPI)
("ESSA" or the "Company"), a pharmaceutical
company focused on developing novel therapies for the treatment of
prostate cancer, is pleased to announce a public offering of
equity securities of the Company in Canada and a concurrent private placement of
equity securities in the United
States (the "Offering"). The Offering is being led by
Soleus Capital and includes RA Capital Management as a new
investor. Existing investors, including BVF Partners LP, among
others, are also co-investing in the Offering.
The Offering will be conducted in each of the provinces of
British Columbia, Alberta and Ontario by way of a prospectus supplement
dated August 23, 2019 to ESSA's base
shelf prospectus dated July 12, 2018
and in the United States on a
private placement basis pursuant to Rule 506(c) of Regulation D
under the Securities Act of 1933, as amended (the "U.S.
Securities Act"). Pursuant to the Offering, ESSA intends to
issue up to 18,000,000 common shares (or pre-funded warrants in
lieu of common shares) of the Company at a price of US$2.00 per
common share for aggregate gross proceeds of up to US$36,000,000.
Each pre-funded warrant (together with the common shares, the
"Securities") entitles the holder thereof to acquire one
common share (a "Warrant Share") at a nominal exercise price
for a period of 60 months following the closing of the
Offering.
The Offering will be undertaken on a best efforts basis pursuant
to the terms and conditions of an agency agreement (the "Agency
Agreement") dated August 23, 2019
between the Company and Bloom Burton Securities, Inc. ("Bloom
Burton") as the Company's sole agent for the Offering in
Canada. Oppenheimer & Co.
Inc., ("Oppenheimer", together with Bloom Burton, the
"Agents") will act as the exclusive U.S. placement
agent. The price of the Securities was determined by
negotiation between the Company and the Agents in
the context of the market.
The Company has applied to list the additional common shares and
the Warrant Shares on the TSX Venture Exchange ("TSXV") and
the Nasdaq Capital Market ("Nasdaq"). Listing will be
subject to satisfying all of the requirements of the TSXV and
Nasdaq. The Company expects to close the Offering on or
about August 27, 2019, or such other
date as may be mutually agreed to by the Company and the Agents,
subject to satisfaction of customary closing conditions, including,
but not limited to, the receipt of all necessary stock exchange
approvals, such as the conditional approval of the TSX.
The Company intends to use the net proceeds of the Offering
primarily to complete the Phase 1 dose-escalation, Phase 1
expansion, and Phase 1 combination studies with EPI-7386. In
addition, the Company plans to conduct additional preclinical
studies with EPI-7386 in various preclinical cancer models
including prostate and breast cancer as well as to continue the
development of additional Aniten molecules. The net proceeds from
the Offering will also be used for working capital and general
corporate purposes.
The issuance of the common shares under the Offering constitutes
a related-party transaction under Multilateral Instrument 61-101 -
Protection of Minority Security Holders in Special
Transactions ("MI 61-101") due to the expected
participation by certain insiders of the Company. These
transactions are exempt from the formal valuation and minority
shareholder approval requirements of MI 61-101 pursuant to sections
5.5(a) and 5.7(1)(a) of MI 61-101 as neither the fair market value
of any securities issued to nor the consideration paid by such
persons would exceed 25.0% of the Company's market
capitalization.
The Securities have not been registered under the U.S.
Securities Act, or any state securities laws, and accordingly, may
not be offered or sold to, or for the account or benefit of,
persons in the United States or
"U.S. persons," as such term is defined in Regulation S promulgated
under the U.S. Securities Act ("U.S. Persons"), except in
compliance with the registration requirements of the U.S.
Securities Act and applicable state securities requirements or
pursuant to exemptions therefrom.
About ESSA Pharma Inc.
ESSA is a pharmaceutical
company focused on developing novel and proprietary therapies for
the treatment of castration-resistant prostate cancer ("CRPC") in
patients whose disease is progressing despite treatment with
current therapies. ESSA's proprietary "aniten" compounds bind to
the N-terminal domain of the androgen receptor ("AR"), inhibiting
AR driven transcription and the AR signaling pathway in a unique
manner which bypasses the drug resistance mechanisms associated
with current anti-androgens. The Company is currently progressing
IND-enabling studies and expects to file an IND with the FDA for
EPI-7386 in the first calendar quarter of 2020. For more
information, please visit www.essapharma.com or follow us on
Twitter under @ESSAPharma.
About Prostate Cancer
Prostate cancer is the
second-most commonly diagnosed cancer among men and the fifth most
common cause of male cancer death worldwide (Globocan, 2018).
Adenocarcinoma of the prostate is dependent on androgen for tumor
progression and depleting or blocking androgen action has been a
mainstay of hormonal treatment for over six decades. Although
tumors are often initially sensitive to medical or surgical
therapies that decrease levels of testosterone, disease progression
despite castrate levels of testosterone generally represents a
transition to the lethal variant of the disease, metastatic CPRC
("mCRPC"), and most patients ultimately succumb to the illness. The
treatment of mCRPC patients has evolved rapidly over the past five
years. Despite these advances, additional treatment options are
needed to improve clinical outcomes in patients, particularly those
who fail existing treatments including abiraterone or enzalutamide,
or those who have contraindications to receive those drugs. Over
time, patients with mCRPC generally experience continued disease
progression, worsening pain, leading to substantial morbidity and
limited survival rates. In both in vitro and in vivo animal
studies, ESSA's novel approach to blocking the androgen pathway has
been shown to be effective in blocking tumor growth when current
therapies are no longer effective.
Forward-Looking Statement Disclaimer
This release
contains certain information which, as presented, constitutes
"forward-looking information" within the meaning of the Private
Securities Litigation Reform Act of 1995 and/or applicable Canadian
securities laws. Forward-looking information involves statements
that relate to future events and often addresses expected future
business and financial performance, containing words such as
"anticipate", "believe", "plan", "estimate", "expect", and
"intend", statements that an action or event "may", "might",
"could", "should", or "will" be taken or occur, or other similar
expressions and includes, but is not limited to, statements about
the expected lead investors, the timing of the closing of the
Offering, the satisfaction and timing of the receipt of required
stock exchange approvals and other conditions to closing of the
Offering, the jurisdictions in which the Common Shares will be
offered and the intended use of proceeds of the Offering.
Forward-looking statements and information are subject to
various known and unknown risks and uncertainties, many of which
are beyond the ability of ESSA to control or predict, and which may
cause ESSA's actual results, performance or achievements to be
materially different from those expressed or implied thereby. Such
statements reflect ESSA's current views with respect to future
events, are subject to risks and uncertainties and are necessarily
based upon a number of estimates and assumptions that, while
considered reasonable by ESSA as of the date of such statements,
are inherently subject to significant medical, scientific,
business, economic, competitive, political and social uncertainties
and contingencies. In making forward looking statements, ESSA may
make various material assumptions, including but not limited to (i)
the accuracy of ESSA's financial projections; (ii) obtaining
positive results of clinical trials; (iii) obtaining necessary
regulatory approvals; and (iv) general business, market and
economic conditions.
Forward-looking information is developed based on assumptions
about such risks, uncertainties and other factors set out herein
and in ESSA's Annual Report on Form 20-F dated December 13, 2018 under the heading "Risk
Factors", a copy of which is available on ESSA's profile on the
SEDAR website at www.sedar.com, ESSA's profile on EDGAR at
www.sec.gov, and as otherwise disclosed from time to time on ESSA's
SEDAR profile. Forward-looking statements are made based on
management's beliefs, estimates and opinions on the date that
statements are made and ESSA undertakes no obligation to update
forward-looking statements if these beliefs, estimates and opinions
or other circumstances should change, except as may be required by
applicable Canadian and United
States securities laws. Readers are cautioned against
attributing undue certainty to forward-looking statements.
Neither the TSXV nor its Regulation Service Provider (as that
term is defined in the policies of the TSXV) accepts responsibility
for the adequacy or accuracy of this release.
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SOURCE ESSA Pharma Inc