Newbury Pharmaceuticals AB publishes prospectus regarding offering of newly issued shares prior to listing application on Nasdaq First North Growth Market
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The Board of Directors of Newbury Pharmaceuticals AB (“Newbury” or “the Company”) decided on January 10th, 2022, with the support of the authorization granted by the Annual General Meeting on October 29, 2021, to carry out an offer of newly issued shares to the public in Sweden, Norway, Denmark, Finland and institutional investors (the “Offer”) prior to listing of the Company's shares on the Nasdaq First North Growth Market (the “Nasdaq First North”). The Board has drawn up a prospectus regarding the Offer, which has today been approved and registered by the Swedish Financial Supervisory Authority (Sw. Finansinspektionen). The prospectus is available at www.newburypharma.com, www.aqurat.se and www.vhcorp.se.
Newbury is a Swedish company that focuses on providing prescription drugs to patients and health care practitioners in the Scandinavian market. Founded in 2020, Newbury in-licenses proprietary product rights in order to benefit from its expertise in drug registration and commercialization. The Company focuses on specialty medicine and its own brands with a strong focus on oncology, rare diseases and neurology. For this purpose, a portfolio of a total of 27 products has been in-licensed, which is expected to generate a stable flow of product launches in the coming years.
An important element of the Company’s operations includes partnerships to deliver differentiated, high-quality and cost-effective products that Newbury can launch in the Scandinavian markets. Newbury’s partnership strategy thus minimizes traditional risks such as investment in capital goods, research and development (”R&D”) and production, which means that Newbury can focus on the registration and commercialization of medicines.
From initially having been focused on building a strong portfolio of in-licensed products, the Company is now entering a commercial phase. The Company has implemented the necessary quality systems to support registration and commercialization of the portfolio. The products are expected to be approved by the national health authorities in the coming years, with an initial market approval of “Icatibant Newbury” during the fourth quarter of 2021. The Company’s products will compete with original medicines and in some cases other suppliers of the same medicine. The Company strives to differentiate itself by focusing on specialty drugs and its own brands and to become a specialist and preferred partner in the Scandinavian markets. In addition, the strict product focus leads to significantly better margins compared to volume-driven traditional medicines.
In addition to the commercialization of the existing portfolio, Newbury is focusing on further strengthening its pipeline for future growth. The Company’s strategic product focus and geographical concentration in Scandinavia make Newbury a preferred partner for pharmaceutical companies that primarily concentrate on larger markets in Europe and the rest of the world. Newbury thus offers its partners quick and dedicated access to Scandinavia. New partnerships are constantly evaluated based on product benefits and competitiveness, and as part of the Company’s partnership strategy, Newbury focuses primarily on maintaining close collaboration with selected partners.
As part of preparing the business for future growth and ensuring that the Company has sufficient working capital for the coming twelve-month period, Newbury’s Board of Directors has decided to carry out this new share issue. The Offer primarily aims to provide the Company with financial resources to accelerate the launch of the existing product portfolio and to expand the pipeline to ensure future growth. Upon full subscription, the Company will receive a maximum net payment of approximately SEK 50 million before deduction of issue costs. The issue proceeds are intended to be used in the order of priority below:
· 25 percent for commercialization of existing portfolio;
· 40 percent for in-licensing of new products; and
· 35 percent for other working capital such as inventory build-up and capital reserves.
The Board’s view is that the current listing on First North will broaden the Company’s shareholder base and give Newbury access to the Swedish and international capital markets. In addition, the listing is expected to strengthen the profile for Newbury by increasing the visibility for future suppliers and partners and giving the Company a better basis for attracting talent to the Company.
The offer in brief
· The Offer is aimed at the general public in Sweden, Norway, Denmark, Finland and institutional investors and comprises 3,846,154 newly issued shares in Newbury. The dilution effect of the Offering for existing shareholders amounts to approximately 19.7 percent of the total number of shares and votes in the Company after the Offering. Upon full subscription in the Offer, Newbury will receive a supplement of approximately SEK 50 million before issue costs.
· The issue price in the Offer amounts to SEK 13 per share.
· The Offering includes subscription commitments from Board members, senior executives, existing shareholders and external investors totaling SEK 40 million, which corresponds to approximately 80 percent of the number of shares in the Offer.
· Subscription for shares will take place during the period from January 12, 2022, to January 25, 2022.
· A prospectus with full terms for the Offer will be published today, January 11, 2022.
· Newbury has received a conditional approval from Nasdaq Stockholm AB for listing of the Company's shares on Nasdaq First North. The approval is conditional on Newbury meeting the formal listing requirements to (i) have secured working capital for a period of twelve months and (ii) have at least 300 shareholders from the first trading day on First North and (iii) no new information emerges that affects the Company’s compliance with the listing requirements. Preliminary first day of trading on Nasdaq First North is February 4, 2022.
· Existing shareholders with holdings in excess of 5 percent, board members and senior executives (private and/or via companies) have undertaken to Västra Hamnen, with certain exceptions, to refrain from selling or otherwise transferring or selling their shares in the Company (”Lock-up commitment ”). The Lock-up commitment is valid for a period of 12 months from the first day of trading in the shares on First North. In addition, all other shareholders have entered into a corresponding Lock-up commitment for a period of 3 months from the first day of trading in the shares on First North. Provided that the Offer is fully subscribed, approximately 80 percent of the shares in the Company are covered by Lock-up commitment after the Offer.
CEO, Lars Minor, comments
We have a strong pipeline which is well positioned for growth in the Scandinavian markets. We will during the next couple of years have a steady stream of product launches and will work to further expand the pipeline with exciting new opportunities. We look forward to unfolding our strategy and help patients across the Scandinavian markets.
Prospectus and application form
In connection with the Offer, the Board has prepared a prospectus, which has been approved and registered by the Swedish Financial Supervisory Authority, and which is hereby published. The prospectus and application form are available on Newbury website (www.newburypharma.com/investors/ipo), Aqurat's website (www.aqurat.se) and Västra Hamnen Corporate Finance website (www.vhcorp.se). The prospectus will soon also be available on Finansinspektionen's website, www.fi.se. To fully understand the potential risks and benefits associated with the decision to invest in the Offer, potential investors should read the prospectus before making an investment decision.
Västra Hamnen Corporate Finance is the financial advisor to Newbury in connection with the Offer. Advokatfirman Lindahl acts as legal advisor. Aqurat Fondkommission acts as an issuing institution.
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