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AlzeCure intends to carry out a Share Issue of approximately SEK 53 MILLION

AlzeCure Pharma AB (”AlzeCure” or the ”Company”), a pharmaceutical company developing a broad portfolio of small molecule product candidates for diseases affecting the central nervous system, with projects in both Alzheimer’s disease and pain, announces that the Company’s Board of Directors, today has resolved on a new issue of shares, of approximately SEK 52.8 million with preferential rights for existing shareholders (the “Share Issue”). The Share Issue is conditional upon the extraordinary general meetings approval on 25 April 2024. The record date for participation in the Share Issue has been set at 29 April 2024. Under the terms of the Share Issue, two (2) existing shares in AlzeCure entitle the shareholder to subscribe for one (1) new share at a price of SEK 1.70 per share. The Share Issue is guaranteed to approximately 63 per cent through subscription commitments and guarantee commitments from, inter alia, existing shareholders, members of the Company’s management and Board of Directors. To enable further capital injection, the Board of Directors may further utilise an over-allotment option of up to approximately SEK 15.0 million (the “Over-allotment Option”). If the Over-allotment Option is exercised in full, the maximum capital contribution amounts to approximately SEK 67.8 million. Any exercise of the Over-allotment Option will be made by the Board of Directors resolving on a new share issue with the support of the existing issue authorisation. Notice of the Extraordinary General Meeting will be published via a separate press release.

The Share Issue – Background and motives

AlzeCure Pharma AB is a pharmaceutical company developing a broad portfolio of small molecule products through three research platforms: NeuroRestore®, Alzstatin® and Painless. NeuroRestore consists of two symptom relieving pharmaceutical candidates in which the target mechanism enables treatment of several indications, Alzheimer’s Disease, but also other diseases and cognitive disorders such as Parkinsons disease, traumatic brain damage and sleep apnea. Alzstatin is focused on developing preventive and disease-modifying pharmaceutical candidates for early treatment of Alzheimer’s disease and consists of two drug candidates. Painless is the Company’s research platform within pain disorders and includes two projects: ACD440 which is a pharmaceutical candidate in a clinical phase directed towards neuropathic pain, and TrkA-NAM which is directed towards other severe pain disorders such as osteoarthritis, e.g. knee osteoarthritis.

During 2023 the Company published positive data showing that NeuroRestore ACD856 has potential disease- modifying effects, among others protecting and improving effects on nerve cell function. This data supports further possibilities for NeuroRestore within Alzheimer’s disease, but also for cognitive disorders within other neurodegenerative diseases, e.g. Parkinsons disease. Moreover, AlzeCure has been able to show that substances from the NeuroRestore-platform have anti-depressant effects in preclinical models. This data is also supported by scientific results in other recently published articles in reputable scientific journals. Based on this data, AlzeCure plans to develop clinical phase II study plans for ACD856 in the coming period together with leading researchers and experts in the field.

ACD440 is a TRPV-1 antagonist developed against neuropathic pain and the Company published positive study results from a phase-IIa clinical study in patients with chronic peripheral neuropathic pain during 2023, which further supports clinical development and out-licensing.

Furthermore, the Company took another pharmaceutical candidate (ACD680), from the Alzheimer’s platform Alzstatin, into the pre-clinical development phase in 2023. The Company’s focus is now to drive continued development of the Alzstatin platform’s two pharmaceutical candidates in order to select a final potential clinical candidate. The next step will then be to enter Phase I clinical trials in humans, which, in addition to safety and tolerability testing, also enables testing of the mechanism (proof-of-mechanism) already in Phase I, i.e. demonstrating a reduction in the production of the harmful protein that forms plaques in the brain leading to Alzheimer’s disease.

In January 2024, the Company announced that another pharmaceutical candidate was selected for the TrkA-NAM programme, ACD137, for osteoarthritis of the knee and other severe pain disorders. The project thus enters the next development phase (pre-clinical development phase).

In parallel with these development steps, the Company is working with business development in order to achieve out-licensing and/or collaboration on the Company’s drug candidates, which would contribute to strengthening the Company’s long-term financing and development opportunities for the Company’s entire project portfolio. This work primarily includes costs for marketing activities as well as negotiation and legal costs.

In order to finance the above-mentioned investments in AlzeCure’s drug candidates and to strengthen the company’s financial position, the Company’s Board of Directors has resolved on the Rights Issue. As the Company is in discussions with several actors regarding possible licence and/or cooperation deals, the Board of Directors makes the assessment that it is valuable to strengthen the cash position in order to obtain better negotiation position and, in the meantime, enable continued development of the Company’s research portfolio to increase the value and attractiveness of its assets. This includes Alzstatin where the focus now is to drive continued development of the platform’s candidates in preclinical development phase to enable the identification of a final potential clinical candidate. Furthermore, the Company will work with the continued development of the TrkA-NAM project where the focus is to drive the continued development of ACD137 in preclinical development phase, towards the clinic. In consultation with leading researchers and experts in the field, the Company will also continue to plan the upcoming phase II study for NeuroRestore ACD856, which takes into account the obtained new preclinical results.

Upon full subscription in the Share Issue, the Company will receive proceeds of approximately SEK 52.8 million, before issue costs. The net proceeds are intended to be used for the following purposes, in order of priority:

  • Business Development, 11 per cent
  • Research & Development, 64 per cent
  • Working capital, 25 per cent

“2023 continued to be a positive and eventful year. AlzeCure continued to make progress in all our projects, and we were also able to present positive clinical phase II results for ACD440 for peripheral neuropathic pain. We are now entering an exciting new year in AlzeCure’s development and the strong support from our main owners is very gratifying. We are also very pleased that Jan Lundberg has shown strong support and chosen to invest in us. Jan Lundeberg has more than 20 years of experience from leading positions in the global pharmaceutical companies AstraZeneca and Eli Lilly, including as global head of research and development. The new share issue secures the funds we need to implement several value-creating development steps in our research portfolio and regarding out-licensing and partnership activities”, says Martin Jönsson, CEO of AlzeCure.”

Summary of the Share Issue

  • One (1) existing share in AlzeCure held on the record date of 29 April 2024 entitles to one (1) subscription right. Two (2) subscription rights entitle the holder to subscribe for one (1) newly issued share.
  • The subscription price amounts to SEK 1.70 per share. Payment shall be made in cash.
  • Through the Share Issue, AlzeCure can raise a maximum of approximately SEK 52.8 million before issue costs.
  • The subscription period runs 2 – 17 May 2024.
  • Subscription rights that are not exercised during the subscription period become invalid and lose their value. Trading in subscription rights is planned to take place on Nasdaq Premier First North Growth Market during the period 2 – 14 May 2024.
  • The Share Issue means that the Company’s share capital increases by a maximum of SEK 776,087.65, corresponding to a maximum of 31,043,506 shares and a maximum dilution of 33.3 per cent.
  • In the event that all shares are not subscribed for with preferential rights (i.e. with subscription rights), the Board of Directors shall, within the framework of the maximum amount of the Share Issue, resolve on allotment of shares subscribed for without subscription rights, whereby allotment shall firstly be made to those who have also subscribed for shares with subscription rights and, in the event that they cannot receive full allotment, allotment shall be made in proportion to their subscription with subscription rights and, if this is not possible, by drawing lots, and secondly, allotment shall be made to others who have subscribed for shares in the Share Issue without subscription rights and, if they cannot receive full allotment, allotment shall be made in proportion to the number of shares subscribed for by each of them and, if this is not possible, by drawing lots. As a last resort, allotment shall be made to guarantors.
  • The Board of Directors’ resolution on the Share Issue is conditional upon the extraordinary general meeting of the Company on 25 April 2024 resolving to approve the Share Issue. Notice of the extraordinary general meeting will be published separately in connection with the publication of this press release.
  • The Company has obtained subscription commitments from existing shareholders to subscribe for shares for approximately SEK 18.8 million in the Share Issue. In addition, the Company has received a guarantee of approximately SEK 14.7 million. This guarantee applies in the event that less than approximately 63 per cent would be subscribed for in the Share Issue, corresponding to 19,705,883 shares. The Company has subscription commitments and guarantee commitments corresponding to approximately SEK 33.5 million. Jan Lundberg has guaranteed approximately SEK 1 million without guarantee compensation, but is instead guaranteed allocation through the Over-allotment Option. In the event that the guarantee is utilised, the guarantor Jan Lundberg will firstly be allocated in full according to his guarantee commitment. Secondly, to the extent possible, allocation will be made pro rata between all guarantors in relation to the respective guarantee amount, and otherwise by drawing lots.
  • The commitments and guarantees are not secured by bank guarantees, blocked funds, pledges or similar arrangements.
  • By virtue of the authorisation granted at the Annual General Meeting on 17 May, the Company has the possibility to also exercise an Over-allotment Option. In the Over-allotment Option, to the extent that Jan Lundberg’s guarantee commitment is not fully utilised in the Share Issue, priority will be given to Jan Lundberg in the first instance and then until Jan Lundberg has been allocated as many shares as correspond to Jan Lundberg’s guarantee commitment. Second priority is given to those who have exercised subscription rights for subscription in the Share Issue and then in relation to the exercised subscription rights, and third priority to others and then in relation to the subscription made.

Complete terms and conditions for the Share Issue and other information about the Company will be set out in the EU growth prospectus which is expected to be published on or around 29 April 2024. The timetable is preliminary and may be subject to change.

Preliminary schedule for the Share Issue

25 April 2024 – Last trading day including the right to receive subscription rights

26 April 2024 – First trading day excluding the right to receive subscription rights

29 April 2024 – Publication of the prospectus

29 April 2024 – Record date for participation in the Share Issue

2-17 May 2024 – Subscription period

2-14 May 2024 – Trading in subscription rights on Nasdaq Premier First North Growth Market

21 May 2024 – Announcement of the outcome of the Share Issue

Change in share capital and number of shares and dilution

Through the Share Issue, the share capital in the Company will increase by a maximum of SEK 776,087.65, from SEK 1,552,175.30 to SEK 2,328,262.95, through the issuance of a maximum of 31,043,506 shares. The number of shares will thereby increase from 62,087,012 to a maximum of 93,130,518 shares. For existing shareholders who do not participate in the Share Issue, and if fully subscribed, this will result in a dilution effect of 33.3 percent of the capital and votes in the Company.

Over-allotment Option

In order to enable additional capital injection if the Share Issue is oversubscribed, the Board of Directors may exercise the Over-allotment Option. Upon full exercise of the Over-allotment Option, the Company will receive an additional SEK 15.0 million. Upon full exercise of the Over-allotment Option, the number of shares in the Company will increase by an additional 8,823,529 shares, subscribed for at a price of SEK 1.70 per share. The exercise of the Over-allotment Option is contingent on resolution by the Board of Directors to issue new shares with the support of the existing authorisation to issue new shares. If the Over-allotment Option is fully exercised, the share capital will increase by an additional SEK 220,588.225 to SEK 2,548,851.175, corresponding to a dilution of approximately 8.6 percent. The total dilution will then amount to approximately 39.1 percent.

Approval at the extraordinary General Meeting

In order to obtain the General Meetings approval on the Share Issue by the Board of Directors, the Board will convene the Company’s shareholders to an Extraordinary General Meeting, which is planned to be held on 25 April 2024. Notice of the Extraordinary General Meeting will be published in a separate press release.

Advisor

AlzeCure has engaged Zonda Partners AB and Synch Advokat AB as financial and legal advisors, respectively, in connection with the Share Issue.

Important information

The information in this press release does not contain nor constitute an offer to acquire, subscribe for or in any other way trade with shares, warrants or other securities in AlzeCure. No measures have been taken and no measures will be taken in order to allow for an offer to the public in any other jurisdictions than Sweden. Offer to for the relevant persons to subscribe for shares in AlzeCure will only be made through the prospectus which AlzeCure estimates will be published around 29 April 2024.

 

The information in this press release may not be made public, be published, or distributed, directly or indirectly, within or to USA, Belarus, Russia, Australia, Hongkong, Japan, New Zeeland, Switzerland, Singapore, South Africa or any other jurisdiction where such action would be illegal, subject to legal restrictions or require other actions than what is stipulated under Swedish law. Any actions not in compliance with these instructions may constitute a violation against applicable securities regulation. No shares or other securities in AlzeCure have been registered, and no shares or other securities will be registered, under United States Securities Act of 1933 (“Securities Act”) as in force from time to time or under the securities laws in any state or other jurisdiction in the US and may not be offered, sold or in any other way transferred, directly or indirectly, in or to the US, except for pursuant to an applicable exemption from, or in a transaction not subject to, the registration rules in the Securities Act and in compliance with the securities regulations in the relevant state or other jurisdiction in the US. This communication is distributed and aimed for only persons in Great Britain who are (i) professional investors under Article 19(5) in UK Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (“Order”) as in force from time to time, or (ii) subjects with a high net wealth and other persons to whom this message can be legally addressed, who are subject to Article 49(2)(a)-(d) pursuant to the Order (all those persons referred to as “Relevant Persons”). Persons who are not Relevant Persons may not act on or rely on the information in this communication. An investment or investment action referred to in this communication is only possible for Relevant Persons and will only be carried out with Relevant Persons. Persons who distribute this communication must themselves make certain that such distribution is allowed.

Forward-looking statements

This press release contains forward-looking statements regarding the Company’s intentions, assessments, or expectations in respect of the Company’s future results, financial position, liquidity, development, prospects, expected growth, strategies, and possibilities as well as the market within which the Company operates. Forward-looking statements are statements which do not refer to historical facts and which typically contain words such as “considers”, “expects”, “predicts”, “intends to”, “estimates”, “will”, “can”, “presumes”, “should”, “may” and, in each case, negations thereof or other similar expressions. The forward-looking statements in this press release are based on different assumptions which, in several cases, are based on additional assumptions. Even if the Company considers the assumptions which are reflected in these forward-looking statements to be true, it cannot be guaranteed that they will in fact, occur or that they are correct. Given that these assumptions are based on assumptions or estimates and that they are subject to risks and uncertainties, the actual result may, for many reasons, substantially deviate from what is stated in the forward-looking statements.

 Such risks, uncertainties, eventualities, and other significant factors may lead to the actual events deviating substantially from the expectations that have been explicitly or implicitly provided for under this press release through the forward-looking statements. The Company does not guarantee that the assumptions which the forward-looking statements in this press release are based on are correct, and a reader of this press release should not unduly rely on the forward-looking statements contained herein. The information, opinions, and forward-looking statements which are either explicitly or implicitly presented herein, are only provided as of the day of this press release and may be subject to change. Neither the Company nor anyone else undertakes to oversee, update, confirm or provide public notification in respect of any change of any forward-looking statement for the purpose of reflecting the actual events or circumstances which occurs in respect of the content of this press release, unless required by law or Nasdaq First North Growth Market’s rules for issuers.

 

For more information, please contact

Martin Jönsson, CEO Tel: +46 707 86 94 43

martin.jonsson@alzecurepharma.com

About AlzeCure Pharma AB (publ)

AlzeCure® is a Swedish pharmaceutical company that develops new innovative small molecule pharmaceutical therapies for the treatment of severe diseases that affect the central nervous system, such as Alzheimer’s disease and pain – indications for which currently available treatment is very limited. The Company is listed on Nasdaq First North Premier Growth Market and is developing several parallel pharmaceutical candidates based on the three research platforms: NeuroRestore®, Alzstatin® and Painless.

NeuroRestore consists of two symptomatic pharmaceutical candidates where the unique mechanism of action allows for multiple indications, including Alzheimer’s disease, as well as cognitive disorders associated with traumatic brain injury, sleep apnea and Parkinson’s disease. The Alzstatin platform focuses on developing disease-modifying and preventive pharmaceutical candidates for early treatment of Alzheimer’s disease and consists of two projects. Painless is the Company’s research platform in the field of pain and includes two projects: ACD440, which is a pharmaceutical candidate in the clinical development phase for the treatment of neuropathic pain, and TrkA-NAM, which targets other types of severe pain in conditions such as arthritis. AlzeCure aims to pursue its own projects through preclinical research and development through an early clinical phase and is continually working on business development to find suitable solutions for license agreements with other pharmaceutical companies.

FNCA Sweden AB is the Company’s Certified Adviser. For more information, please visit www.alzecurepharma.com.

 

This information is information that AlzeCure Pharma is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 2024-03-26 08:00 CET.