Tampa biotech firm's shares slide 42% after $2.1M capital raise announcement

Oragenics, a publicly traded Tampa-based pharmaceutical company, says it will offer 1.4 million shares for $1.50 per share, seeking proceeds of $2.1 million to fund a promising brain-injury treatment.

The announcement is notable since Oragenics' lead product is a COVID-19 vaccine candidate. But the pharmaceutical company seems to be aiming to maintain a diverse menu.

The announcement is also notable for its dilutive nature: Dow Jones Newswires reports the company's share price closed at $2.45 Tuesday. It then fell more than 40% in premarket trading Wednesday after the announcement, Dow Jones reports. Oragenics shares closed Wednesday at $1.42, down -42.04%. 

Oragenics develops complex intranasal pharmaceuticals for the treatment of neurological disorders. It is also examining drugs fighting infectious diseases including coronaviruses and organisms resistant to multiple drugs.

The offering follows a change in leadership announced Feb. 12, when former CEO Kimberly Murphy entered into a mutual separation agreement, with both parties saying no disagreement was involved. She remained on the company board.

The board then appointed Michael Redmond, company president, as interim "principal executive officer."

Oragenics'  lead product is NT-CoV2-1, an intranasal vaccine candidate to prevent COVID-19 and variants of coronavirus.

But the company sees value in its ONP-002 product, a fully synthetic neurosteroid being developed to treat mild traumatic brain injury — concussions. In the Wednesday news release, Oragenics says it intends to use the proceeds to fund the continued development of ONP-002.

Other monies will be used for general corporate purposes and working capital, Oragenics says.

ThinkEquity of San Francisco and Laidlaw and Co. Ltd. of New York and London are acting as joint book-running managers for the offering, the company says.