Zealand to Raise $1B in Public Offering to Fund Obesity Candidates
26 Jun 2024
Phase 1Clinical Result
Pictured: Old Russian vintage weight scales/iStock, Cerebro_K
Zealand Pharma announced Tuesday that it is issuing millions of new shares to raise DKK 7 billion ($1 billion) to help advance its obesity candidates after posting promising early-stage data last week.
The Danish Pharma is issuing 8,350,000 new ordinary shares at a price of DKK 843 ($120.71) per share, which is expected to be completed on June 28. The shares will be admitted to trading and listing on Nasdaq Copenhagen on July 1.
The move comes as Zealand posted interim phase Ib data last week for its amylin analog candidate petrelintide, showing weight reduction and a favorable tolerability profile. Petrelintide demonstrated a mean weight reduction of 8.6% from the baseline compared to 1.7% for patients on a placebo. Jefferies analysts in an investor note said that the data from Zealand supports the “potential for weight loss at least on par” with the popular GLP-1 medicines from Eli Lilly and Novo Nordisk.
Zealand plans to use the cash from the public offering to advance its obesity programs into Phase IIb clinical trials and beyond. The funds will also be used to invest in chemistry, manufacturing and control activities for its obesity program.
The company also said its obesity candidates will target clinical development in related indications but did not provide further details. Zealand expects the funding to help advance its clinical pipeline and reach “several potential key milestones.” The company is prioritizing its resources on R&D and engaging in “strategic partnerships” for eventual commercialization and co-development.
Last month, Zealand reported Phase I data for another obesity candidate, a GLP-1/GLP-2 asset known as dapiglutide. A low dose of the investigational drug showed a slight mean weight loss change of 2.9%, compared to 2.2% for patients taking a placebo.
Zealand is not the only biotech targeting the lucrative weight-loss market and looking to raise funds. Earlier this month, Bay Area-based Structure Therapeutics announced it was proceeding with a public offering worth $476 million after showing positive mid-stage results for its oral GLP-1 candidate.
Tyler Patchen is a staff writer at BioSpace. You can reach him at tyler.patchen@biospace.com. Follow him on LinkedIn.
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