$Biostage(BSTG)$ $Miromatrix Medical(MIRO)$ $Humacyte (HUMA)$ Biostage Announces $5.1 MillionFinancing to Advance Clinical Trial
NEWS PROVIDED BY
Biostage, Inc.
May 13, 2022, 08:30 ET HOLLISTON, Mass.
,May 13, 2022
/PRNewswire/ -- Biostage, Inc. (OTCQB: BSTG ) ("Biostage" orthe "Company"), a cell-therapy biotechnology company with successful fi rst-in-humanexperience in treating esophageal cancer (conducted at the Mayo Clinic and published lastAugust) and FDA approval to commence a clinical trial of the Biostage Esophageal Implantfor severe esophageal disease including cancer, today announced that it has raised approximately
$5.1 million from new and existing investors in a private placement of itsshares. Additional details are provided below.
The funds will be used to accelerate the clinical development of Biostage's lead productcandidate, the Biostage Esophageal Implant, or BEI. The FDA has approved a ten-patientphase one and phase two clinical trial to study the repair of damage to the esophagus inadults caused by cancer or injury. The FDA has indicated a willingness to consider expandingthis clinical trial to include pediatric subjects with birth defects in the esophagus once thesafety of the implant is shown in adults. Hence, the Company expects the repair of birthdefects in the esophagus to be an additional indication for which Biostage will seek FDAapproval.
Biostage is also developing other uses of its technology such as for treating cancer of thelung using the Biostage Bronchial Implant. Similar to how the BEI could be used toregenerate the esophagus, the Biostage Bronchial Implant would be used to regenerate abronchus that has been surgically removed to treat bronchial cancer, injury or birth defects.
Biostage's Interim Chief Executive Offi cer, Director and Chairman, David Green
stated, "I amvery pleased to welcome our new strategic investors and to thank our existing investors fortheir continued support. We look forward to making Biostage a success both for its patientsand shareholders".
Details of the Private Placement
On
May 12, 2022
, the Company entered into Securities Purchase Agreements (each a"Purchase Agreement") with certain investors (the "Investors") pursuant to which theInvestors agreed to purchase in a private placement an aggregate of 854,771 shares ofcommon stock and warrants to purchase 427,390 shares of common stock, subject toadjustment as provided in the warrant agreement (the "Warrants"), for the aggregatepurchase price of
$5.1 million with a purchase price per unit of $5.92 (the "PrivatePlacement"). Each unit consisted of one share of common stock and a warrant to purchaseone half of one share of common stock, subject to adjustment, as provided in the Warrants.The Company has received an aggregate of $4.8 million gross proceeds from the PrivatePlacement through May 12, 2022 , and expects to receive the remaining subscriptionamounts in the aggregate of $260,000 promptly following such date.
The Warrants have an exercise price of $8.88 per share, subject to adjustments, as providedunder the terms thereof, and are immediately exercisable. The Warrants are exercisable untilfi ve years (5) from the issuance date.
The Warrants have certain adjustment provisions, including adjustments at the election ofthe holder that are triggered in the event that the Company closes a registered publicoffering within six months following the date of the warrants. If such public offering includeswarrants, then the holder of the Warrant can elect to adjust the exercise price of the Warrantto match the exercise price of the warrant issued in the public offering, and the sharessubject to the Warrant in relation to the warrant coverage in the public offering. If suchpublic offering does not include warrants but is closed with a price per share lower than theprice per share in the Private Placement, then the holder of the Warrant can elect to adjustthe shares subject to the Warrant pursuant to a formula utilizing the difference between theprice per share in the Private Placement and the price in the public offering, as well as theBlack-Scholes value of a certain warrant at such time.
About Biostage.
Biostage is a clinical-stage biotech company that uses cell therapy to regenerate organsinside the human body to treat cancer, trauma and birth defects. We have performed theworld's fi rst regeneration of an esophagus in a human cancer patient. This surgery wasperformed at Mayo Clinic and was published in August 2021.
Biostage has 8 issued U.S. patents, 2 orphan-drug designations (which provide 7 years ofmarket exclusivity in addition to any patents), and the possibility of 2 Priority ReviewVouchers from the FDA.
Biostage's current goals include raising capital, uplisting from the OTC bulletin board toNASDAQ and beginning its clinical trial for repair of the esophagus in adults.
Forward-Looking Statements
Some of the statements in this press release are "forward-looking" and are made pursuantto the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These"forward-looking" statements in this press release include, but are not limited to, statementsrelating to the capabilities and performance of our products and product candidates; ourcapital raising plans and expectations, including uplifting to NASDAQ; developmentexpectations and regulatory approval of any of the Company's products, including thoseutilizing its Biostage Esophageal Implant technology, by the U.S. Food and DrugAdministration, the European Medicines Agency or otherwise, which expectations orapprovals may not be achieved or obtained on a timely basis or at all; and success withrespect to any collaborations, clinical trials and other development and commercializationefforts of the Company's products, which such success may not be achieved or obtained ona timely basis or at all. These statements involve risks and uncertainties that may causeresults to differ materially from the statements set forth in this press release, including,among other things, the Company's inability to obtain needed funds in the immediatefuture; the Company's ability to obtain and maintain regulatory approval for its products;plus other factors described under the heading "Item 1A. Risk Factors" in the Company'sAnnual Report on Form 10-K for the fi scal year ended December 31, 2021 or described in theCompany's other public fi lings. The Company's results may also be affected by factors ofwhich the Company is not currently aware. The forward-looking statements in this pressrelease speak only as of the date of this press release. The Company expressly disclaims any
obligation or undertaking to release publicly any updates or revisions to such statements torefl ect any change in its expectations with regard thereto or any changes in the events,conditions or circumstances on which any such statement is based.
Investor Relations Contact
Shunfu Hu
Vice President of Business Development
and Operations
774-233-7300
shu@biostage.com
SOURCE Biostage, Inc.