Novan, Inc. ("the Company" or "Novan") (NASDAQ:NOVN), today announced it has entered into a definitive agreement with an institutional investor to sell to the investor, in a registered direct offering priced at-the-market under Nasdaq rules, (i) 2,080,696 shares of its common stock and accompanying warrants to purchase up to 2,080,696 shares of common stock and (ii) pre-funded warrants to purchase up to 3,180,615 shares of common stock and accompanying warrants to purchase up to 3,180,615 shares of common stock, for aggregate gross proceeds of approximately $15.0 million.
The shares (or pre-funded warrants in lieu thereof) and accompanying warrants are being sold together, each consisting of one share of common stock or a pre-funded warrant to purchase one share of common stock, as the case may be, and a warrant to purchase one share of common stock, at an offering price of $2.851 per share and accompanying warrant and $2.841 per pre-funded warrant and accompanying warrant. The pre-funded warrants will be exercisable immediately, have an exercise price of $0.01 per share and will be exercisable until all of the pre-funded warrants are exercised in full. The warrants will be exercisable immediately, have an exercise price of $2.851 per share, and will expire five years from the date of issuance. The offering is expected to close on or about June 13, 2022, subject to customary closing conditions.
Oppenheimer & Co. Inc. is acting as the sole placement agent for the offering.
Novan intends to use the net proceeds from the offering, together with existing cash, to fund research and development program activities, including (i) preparing for and seeking regulatory approval of its product candidate, SB206, as a treatment for molluscum contagiosum; (ii) planning for potential commercialization of SB206; and (iii) conducting small-scale drug substance and drug product manufacturing activities to support the SB206 regulatory submission process. The Company also intends to use the net proceeds from the offering (i) to support sales and marketing efforts for its marketed products; and (ii) for general corporate purposes, including selling, general and administrative expenses, capital expenditures and working capital needs.
The securities described above are being offered by Novan pursuant to a shelf registration statement (Registration No. 333-262865) filed with the Securities and Exchange Commission (the "SEC") and declared effective by the SEC on February 25, 2022. The offering is being made only by means of a prospectus supplement and accompanying prospectus. A prospectus supplement and accompanying prospectus relating to the registered direct offering will be filed with the SEC and, when available, may be obtained for free on the SEC's website located at http://www.sec.gov. When available, electronic copies of the final prospectus supplement and accompanying prospectus relating to the public offering may be obtained by contacting Oppenheimer & Co. Inc., Attention: Syndicate Prospectus Department, 85 Broad St., 26th Floor, New York, NY 10004, by telephone at (212) 667-8055, or by email at EquityProspectus@opco.com.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.