Citius Pharmaceuticals Closes $15M Direct Offering

Citius Pharmaceuticals Inc. (Nasdaq: CTXR), a biopharmaceutical company focusing on critical care products, announced the completion of its registered direct offering. This offering involved the sale of 21,428,574 shares of common stock, along with warrants to purchase an equal number of shares, at a price of $0.70 per share and accompanying warrant. These warrants are set to become exercisable six months post-issuance at an exercise price of $0.75 per share and will expire five years after the initial exercise date.

H.C. Wainwright & Co. was the exclusive placement agent for this offering. The company expects to generate approximately $15 million in gross proceeds from the transaction, which will be subject to deductions for placement agent fees and other related expenses. Citius plans to allocate the net proceeds for various corporate purposes, including the pre-clinical and clinical development of its product candidates, as well as for working capital and capital expenditures.

The offering was conducted via a "shelf" registration statement filed with the Securities and Exchange Commission (SEC) on February 23, 2024, which became effective on March 1, 2024. The specifics of the offering were made available through a prospectus and a supplementary document, both of which are accessible on the SEC’s website. Copies of these documents can also be obtained by contacting H.C. Wainwright & Co.

Citius Pharmaceuticals is committed to the development and commercialization of innovative critical care products, with a diverse portfolio that includes two late-stage product candidates. One of their key candidates, LYMPHIR™, is an IL-2R immunotherapy aimed at treating cutaneous T-cell lymphoma (CTCL). The Biologics License Application for LYMPHIR is currently under review by the FDA, with an action date set for August 13, 2024. The company has announced intentions to establish Citius Oncology, a new publicly traded entity with LYMPHIR as its primary asset. LYMPHIR has been granted orphan drug designation by the FDA for both CTCL and peripheral T-cell lymphoma (PTCL).

Another notable product in the Citius pipeline is CITI-002 (Halo-Lido), a topical formulation designed to alleviate hemorrhoidal discomfort. The company recently concluded enrollment for its Phase 2b clinical trial for this product.

Citius Pharmaceuticals emphasizes the presence of risks and uncertainties that could influence their business outcomes and stock prices. These include potential variations in research and development results, uncertainties in clinical testing, the need for substantial additional funds, and reliance on third-party suppliers. The market acceptance of their products, if approved, and the ability to maintain strategic relationships and secure funding, also pose significant risks. Additionally, factors like government regulation, competition, and intellectual property matters are crucial elements that could affect the company’s performance. The impact of Covid-19 and potential future public health risks adds another layer of uncertainty.

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