Shield received a pan-European market authorisation approval for the iron deficiency anaemia treatment last year and it is now looking to spend more on “commercialisation activities” in the UK and Germany.
US new drug application filing
Some of the cash raised will also go towards the filing of a new drug application (NDA) over in the US which, should it be approved, would open up another potentially lucrative market for Shield.
That’s a little further down the line though, with the NDA filing not expected until the first half of 2018.
Cash will also fund further Feraccru clinical studies
Shield hopes that Feraccru has more potential than just as a treatment for iron deficiency anaemia and it is currently running a phase III trial which is testing Feraccru as a possible treatment for chronic kidney disease.
Some of the money raised today will be used to deliver data from this AEGIS study which is due in the final quarter of 2017.
A follow-up phase IIIb ‘head-to-head’ trial is expected in the not-too-distant – likely the first half of 2018 – and the cash influx will also go towards funding that.
After all of that, what’s left over will be used to provide further working capital for the next nine months or so.
‘Exciting time’ for Shield
“Since our IPO in 2016 Shield has transitioned into a commercially focused specialty pharma business that is now actively generating revenue in both Germany and the UK from Feraccru,” said chief executive Carl Sterritt.
“With key data and pipeline progress due in the coming months, which are expected to provide significant additional value creating opportunities for the company, the board and management team remain focused on execution of our plans.
“I am grateful for the support indicated for the fundraise from our existing shareholders at this exciting time as these funds will enable us to reach and go beyond the upcoming key inflection points.”
Warrants, placing and subscription
To get the £12mln (£11.4mln after fees are deducted) needed to carry out the above, has announced a “co-ordinated exercise of existing warrants”, a placing of new shares and a subscription by the directors and a senior manager.
Shield expects warrant holders to exercise 6.87mln warrants (which have an expiry date of 30 June) at 150p a piece. That will make up the bulk of the fundraise; approximately £10.3mln in total.
Next up is the proposed placing which will see the AIM-quoted group issue at least 1mln new shares to investors, also at a price of 150p each.
The final, and smallest, part of the fundraise is the subscription of new shares by the directors and a senior manager, which should net Shield an extra £145,000.
All of the new shares issued are expected to be admitted to trading on AIM by 28 June.
Shares were down 5% in early deals on Thursday to 160p.