Durham drug developer Heat Biologics Inc. announced Thursday it would issue five million new shares of the company in a public offering valued at $4 million, it said in a release.
The company, which focuses on the field of cancer immunotherapy, is pricing the new shares at 80 cents per share. Heat Biologics plans to use the capital to fund its ongoing clinical trials, to boost working capital and to acquire, license or invest in complementary businesses, technologies, product candidates or other intellectual property, it said in a filing with the Securities and Exchange Commission.
New York-based investment bank Aegis Capital Corp. is acting as the sole underwriter for the offering. Aegis will have a 45-day option to purchase up to 750,000 additional shares of common stock at the public offering price.
The offering is expected to close March 28.
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The new offering comes as the Nasdaq stock market pressures Heat Biologics to raise the price of its stock. Last week, the Nasdaq told the company it was in danger of having its stock delisted from trading unless it raises its share price above $1 per share.
The notification came after Heat Biologics failed to maintain a minimum closing price of $1 per share for the 30 consecutive business days between Jan. 31 and March 14, according to an SEC filing. The Nasdaq requires all companies listed on its market to maintain a minimum bid price of at least $1 per share.
The company has until Sept. 11 to raise its share price to $1 per share.
Heat Biologics, which was founded in 2008, is developing cancer vaccines for lung and bladder cancer. The drug developer posted a net loss of $13 million for 2016 and has approximately $7.8 million in cash on hand.
Earlier this week, Heat Biologics announced its experimental lung cancer vaccine, HS-110, produced positive data in its ongoing phase 2 clinical trials. An analysis of 15 patients suggested that HS-110 plays an integral role in tumor reduction and may enhance efficacy of checkpoint inhibitors in lung cancer patients, the company said.
The company also acquired the Texas biotech company Pelican Therapeutics in a deal worth approximately $1.5 million this month.
Shares of the company ended trading Thursday at 87 cents per share — down 16 cents or 15.8 percent on the day.