PYC Therapeutics Ltd (ASX: PYC) is a clinical-stage biotechnology company that is involves int the creation of RNA therapies for patients with genetic diseases. They make use of their proprietary RNA therapeutic class drug delivery platform to enhance the potency of precision medicines.
PYC focuses on three core therapeutic areas, ocular, central nervous and renal systems, they target various disease areas including retinitis pigmentosa type 11 (RP11), autosomal dominant optic atrophy (ADOA), autosomal dominant polycystic kidney disease (ADPKD) and Phelan-McDermid syndrome (PMS).
Overview of the Entitlement Offer
April 17th, 2025, PYC Therapeutics announced the successful completion of its pro-rata accelerated non-renounceable entitlement offer, raising approximately A$146 million. The announcement follows the initial release on February 17, 2025, detailing the company’s plans for the equity raising.
PYC initiated the entitlement offer to eligible shareholders on a 1-for-4 basis, issuing new shares at A$1.25 each. This price represented a 2.7% discount to the last traded price of A$1.285 on February 14, 2025, and a 4.9% discount to the 5-day VWAP up to that date. The offer aimed to issue up to approximately 117 million new fully paid ordinary shares.
E&P Capital Pty Ltd and Barrenjoey Markets Pty Limited acted as joint lead managers for the offer, with Tenzing Partners providing legal counsel.
Institutional and Retail Components
The entitlement offer was divided into two components, an institutional entitlement offer conducted from February 17 to February 18, 2025, this component allowed eligible institutional shareholders to participate. The new shares under this offer were issued on February 27, 2025.
There was also a retail entitlement offer open to eligible retail shareholders in Australia and New Zealand, this component ran from February 24 to March 14, 2025. The new shares under this offer were issued on March 24, 2025.
Placement Support
Major shareholder Australian Land Pty Ltd, controlled by Chairman Alan Tribe, subscribed for $35 million worth of new shares. Additionally, PYC secured underwriting commitments from existing large shareholders with binding underwriting agreements to subscribe for a minimum of $70 million worth of new shares, ensuring a minimum raise of $105 million.
Use of Funds
The proceeds from the entitlement offer will be utilised to advance PYC’s pipeline of drug candidates. One of the primary goals is to progress the first blinding eye disease drug candidate into late-stage human trials. This is a significant step towards bringing a potentially life-changing treatment to patients suffering from this condition.
The funds will also support the advancement of the second blinding eye disease drug candidate into mid-stage human trials.
Early-stage human trials for the polycystic kidney disease drug candidate will also be funded. This is crucial for understanding the initial impact and potential of the drug in treating this genetic disorder.
Moreover, the proceeds will be used to initiate human trials for the Phelan-McDermid Syndrome drug program. This program aims to address a rare genetic condition that currently has no approved treatments, offering hope to affected individuals and their families.
Further drug discovery and platform development efforts will be supported by the raised funds. This will enable PYC to continue innovating and expanding its pipeline of drug candidates, ensuring a steady flow of new treatments in the future.
Lastly, the funds will cover general working capital and the costs associated with the entitlement offer. This ensures that the company remains financially stable and can effectively manage its operations and ongoing projects.
Details About Pipeline Drug Candidates
PYC Therapeutics is advancing several promising drug candidates through its pipeline, each targeting significant unmet medical needs.
The lead drug candidate, VP-001, is designed to treat Retinitis Pigmentosa type 11 (RP11), a blinding eye disease that begins in childhood and leads to legal blindness by middle age. RP11 is caused by insufficient expression of the PRPF31 gene in the retina. VP-001 aims to restore the expression of this gene to normal levels, thereby preserving retinal function and preventing vision loss. This drug has received Fast Track designation from the US FDA, which facilitates its accelerated development and review.
The second drug candidate in PYC’s pipeline also targets a blinding eye disease, although specific details about the disease and the drug’s mechanism have not been disclosed. This candidate is currently progressing into mid-stage human trials, aiming to further validate its efficacy and safety.
PYC-003 is being developed to treat Autosomal Dominant Polycystic Kidney Disease (PKD), a genetic disorder characterised by the growth of numerous cysts in the kidneys, leading to kidney failure. This drug candidate has shown promising results in pre-clinical models, demonstrating the potential to reduce cyst size and frequency. PYC-003 aims to address the root cause of PKD, potentially arresting the disease’s progression and allowing damaged kidneys to regenerate.
This program targets Phelan-McDermid Syndrome, a rare genetic disorder caused by deletions or mutations in the SHANK3 gene. The syndrome leads to developmental delays, intellectual disabilities, and other neurological issues. PYC’s drug candidate aims to restore normal SHANK3 gene function, offering a potential treatment for this currently untreatable condition.
In addition to these specific candidates, PYC is investing in further drug discovery and the development of its proprietary RNA therapeutic platform. This platform enhances the delivery and potency of RNA-based precision medicines, enabling the company to expand its pipeline and address a broader range of genetic diseases.
