Global Blood Therapeutics Rises After Pricing Secondary Offering

By Chris Lange Updated Jan 13, 6:34AM EST · Published Jun 21, 9:10AM EDT

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Global Blood Therapeutics Rises After Pricing Secondary Offering — © Thinkstock

Global Blood Therapeutics Inc. (NASDAQ: GBT) shares saw a handy gain in the premarket on Tuesday, despite the company pricing its secondary offering below its previous price level. This could be the result of recent optimism surrounding a recent mid-stage trial, or even just compensating for the drop since the secondary offering was originally announced.

GBT announced that it will price its 6.4 million shares at $18.75, with an overallotment option for an additional 960,000 shares. At this price the entire offering is valued up to $138 million. The offering is expected to close on or about June 24.

The underwriters are JPMorgan and Morgan Stanley, which are acting as joint book-running managers for the offering. Also Cowen and Wedbush PacGrow are acting as the co-managers.

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This clinical-stage biopharmaceutical company is dedicated to discovering, developing and commercializing novel therapeutics to treat grievous blood-based disorders with significant unmet need.

GBT is developing its lead product candidate, GBT440, as an oral, once-daily therapy for sickle cell disease (SCD) and is currently evaluating GBT440 in both healthy subjects and SCD patients in a randomized, placebo-controlled, double-blind Phase 1/2 clinical trial. In addition to GBT440 for the treatment of SCD, GBT is engaged in research and development activities targeted toward hypoxemic pulmonary disorders, including idiopathic pulmonary fibrosis and hereditary angioedema.

In a recent filing, GBT detailed its finances as follows:

We have never been profitable and have incurred net losses in each year since inception. Our net losses were $16.6 million and $7.4 million for the three months ended March 31, 2016 and 2015, respectively. As of March 31, 2016 we had an accumulated deficit of $115.1 million. To date, we have not generated any revenue. We do not expect to receive any revenue from any product candidates that we develop until we obtain regulatory approval and commercialize our products or enter into collaborative agreements with third parties. Substantially all of our net losses have resulted from costs incurred in connection with our research and development programs and from general and administrative costs associated with our operations. As of March 31, 2016, we had $134.0 million of cash and cash equivalents.

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Shares of GBT closed Monday up 6.2% at $18.94, with a consensus analyst price target of $60.50 and a 52-week trading range of $12.24 to $57.00. Following the pricing announcement, the stock was up Tuesday in early trading indications by 2.4% to $19.36.

About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.