What happened
A mere day after its stock rose by nearly 20%, biotech DBV Technologies(NASDAQ: DBVT) experienced a much stronger leap on Thursday. Shares of the company, which is developing a patch product to treat peanut allergies, ascended by nearly 80%.
So what
Still buoyed by the highly positive clinical update it posted about Viaskin Peanut Wednesday, DBV Technologies stock surged again after delivering an encouraging follow-up. Thursday morning, the company announced that it's getting some coin to keep the development train running.
DBV is receiving $194 million in private investment in public equity (PIPE) financing from the sale of a combination of nearly 33 million of its ordinary shares and pre-funded warrants granting holders the right to buy more than 28 million.
The former securities are priced at 3 euros ($3.21) apiece, and the latter will cost 2.90 euros ($3.11). The warrants are cheaper, as they take into account a 0.10 euro ($0.11) exercise price. That $3.21 per share equivalent was, sensibly, Thursday's closing price for France-based DBV's Nasdaq-listed shares.
Better, the ordinary shares being sold aren't registered in the U.S., so there won't be any dilution for existing investors in this market.
Now what
Management didn't specify what the funds it's raising will be used for, but it probably didn't need to. Viaskin Peanut is by far the biotech company's most significant pipeline therapy, and as it has the potential to become a go-to treatment for a widespread affliction, the bulk of the money is sure to go toward that program.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool recommends Nasdaq. The Motley Fool has a disclosure policy.
