Onconetix Lowers Warrant Exercise Price to $0.15 By

Onconetix Lowers Warrant Exercise Price to alt=

CINCINNATI – Onconetix, Inc. (NASDAQ:ONCO), a biotechnology company, announced the immediate exercise of certain existing warrants to purchase shares of its common stock at a reduced price. These warrants were originally issued in August of last year at prices ranging from $1.09 to $2.546 and are now exercisable at $0.15 per share.

The transaction is expected to close tomorrow, subject to customary closing conditions, with HC Wainwright & Co. serving as exclusive placement agent. Onconetix expects to raise approximately $1.11 million in gross proceeds before fees and expenses, which will be allocated to working capital and general corporate purposes.

The common shares issuable upon exercise of the existing warrants have been registered under a Form S-1 Registration Statement, effective July 1, 2024. In addition, Onconetix intends to issue new unregistered warrants for up to 22,375,926 shares of common stock at the same reduced price of $0.15 in a private placement, subject to shareholder approval.

These new warrants can be exercised upon shareholder approval, with one third being valid for five years and the remaining two thirds for twenty-four months after the approval date.

The company has agreed to convene a shareholders’ meeting within 90 days of closing to obtain the necessary approvals. The new warrants and the common stock into which they may be converted have not been registered under the Securities Act of 1933 and as such may not be offered or sold in the U.S. absent registration or an applicable exemption.

Onconetix, formerly known as Blue Water Biotech, Inc., focuses on men’s health and oncology solutions. The company owns Proclarix, a diagnostic test for prostate cancer approved in the European Union, and ENTADFI, an FDA-approved treatment for benign prostatic hyperplasia. The company plans to file a registration statement with the SEC for the resale of the shares issuable upon exercise of the new warrants.

In other recent news, Onconetix, a pharmaceutical company, has undergone significant management changes, including the departure of CFO Bruce Harmon and the appointment of Karina M. Fedasz as interim CFO.

The company announced that Harmon’s departure would be followed by a two-month severance package. Fedasz, who has more than two decades of experience in financial management and strategic planning, has held corporate development roles and served as CFO in a variety of industries.

Prior to joining Onconetix, Fedasz provided her expertise to clients including a non-profit organization and an early-stage company focused on artificial intelligence and health tracking. She also managed the initial public offering for IDW Media Holdings. In addition to Fedasz’s appointment, Onconetix has retained CFO Squad LLC for certain accounting services.

The company did not disclose Fedasz’s compensation arrangements, saying the Board’s Compensation Committee will determine them at a later date. Onconetix clarified that there are no family relationships between Fedasz and any of the company’s directors or executives, and that she has no material interest in any transactions that would require disclosure.

InvestingPro Insights

In the context of Onconetix, Inc.’s (NASDAQ:ONCO) recent warrant exercise announcement, a closer look at the company’s financial health and stock performance may provide investors with additional insights. According to data from InvestingPro, Onconetix has a market cap of just $3.35 million, reflecting a small-cap stock. The company’s price-to-earnings (P/E) ratio stands at -0.07, indicating that it is currently unprofitable. Furthermore, its gross profit margin for the trailing twelve months as of Q1 2024 is deeply negative at -123.62%, highlighting the company’s challenges in maintaining profitability.

InvestingPro Tips highlight several areas of concern for Onconetix, including a significant debt load and a rapid cash burn rate. Analysts also expect revenue to decline in the current year, which could impact the company’s ability to generate revenue. Given the stock’s high price volatility, these factors should be carefully considered by potential investors. Additionally, Onconetix doesn’t pay a dividend, which could impact its appeal to income-seeking shareholders. It’s worth noting that there are 13 additional InvestingPro Tips available that can provide more context on the company’s financial health and stock performance.

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