GW Pharmaceuticals plc (AiM:GWP) today announces that it has signed an agreement with a United States-based institutional investor to raise $15 million (£8.6 million) before expenses through a placing for cash of 6,165,978 new GW ordinary shares at 139.61 pence per share.
The new shares represent approximately 5.4 per cent of the Company's issued share capital prior to the placing and were approved for issuance by shareholders at the Company's Annual General Meeting on 22 March 2005. The new shares were placed at a 5% discount to the volume weighted average price on 3 January 2006. In addition, GW has issued to the investor warrants to subscribe for 1,849,794 GW shares, 924,897 of which have an exercise price of £1.61 per share, and the remaining 924,897 have an exercise price of £1.745 per share. The warrants can be exercised at any time prior to the fifth anniversary of their issue.
In a separate statement also issued today, GW has announced that the US Food and Drug Administration (FDA) has accepted its Investigational New Drug (IND) Application for Sativex® for the treatment of pain in patients with advanced cancer that has not been adequately relieved by opioid medications. As part of this IND , the FDA has agreed that GW may proceed directly into pivotal Phase III clinical trials in the US in this very seriously ill patient population.
The gross proceeds of the placing of £8.6 million (approximately £8.1 million net of expenses) will provide additional balance sheet resources to further the Company's R&D and clinical trial programmes. In particular, the additional financing will provide GW with the resources to start making commitments to the US development of Sativex. In parallel, GW shall seek a US licensing partner for Sativex with a view to such partner taking responsibility for the principal costs of US development.
Dr Geoffrey Guy, Executive Chairman of GW, said: “The announcement today of a Phase III IND in the US together with this US-led financing marks a further important step forward for the Company's global ambitions. GW has been planning carefully its approach to the US market for a number of years and has established a group of prominent US advisers and experts to assist its efforts. This financing will permit GW to start the US development of Sativex whilst the company seeks a US licensing partner. The placing also widens GW's institutional shareholder base to include an experienced US based biopharmaceutical investor.”
Application will be made today for the new shares to be admitted to AiM, a market of the London Stock Exchange (“Admission”). The placing will be completed upon Admission, which is expected to become effective on 11 January 2006. When issued, the new shares will rank pari passu in all respects with the Company's existing ordinary shares. Following the placing, GW will have a total of 120,049,335 ordinary shares in issue.
Seven Hills Partners LLC acted as exclusive placement agent to GW for this financing. As part of the placement fee, GW has issued to Seven Hills warrants to subscribe for 77,075 GW shares at an exercise price of £1.3961 per share.
GW Pharmaceuticals plc
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Notes to Editors:
About GW Pharmaceuticals plc
GW was founded in 1998 and listed on the Alternative Investment Market (AIM) of the London Stock Exchange in June 2001. Operating under license from the UK Home Office, the company is developing cannabis-derived pharmaceutical products for patients with multiple sclerosis, spinal cord injury, rheumatoid arthritis, neuropathic pain, cancer pain and other severe medical conditions. GW maintains control over all aspects of the development process: botanical research, cultivation, extraction, formulation and medication delivery.
GW has assembled a team of over 100 scientists with extensive experience in developing both plant-based prescription pharmaceutical products and medicines containing controlled substances. GW is dedicated to developing treatment options that alleviate pain symptoms in patients who suffer from serious ailments.
For further information, please visit the Company's website: www.gwpharm.com
This news release may contain forward-looking statements that reflect the Company's current expectations regarding future events, including development and regulatory clearance of the Company's products. Forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein and depend on a number of factors, including (inter alia), the success of the Company's research strategies, the applicability of the discoveries made therein, the successful and timely completion of uncertainties related to the regulatory process, and the acceptance of Sativex and other products by consumer and medical professionals.