SCHEDULE: Soleus Capital Boosts Stake in ESSA Pharma to 9.8% Following Swap Unwind

Soleus Capital Master Fund, L.P. has increased its beneficial ownership in ESSA Pharma, Inc. to 9.8% of outstanding common stock after unwinding a cash-settled swap and acquiring 2.1 million shares.

Summary

• Soleus Capital Master Fund, L.P. and its affiliated reporting persons now beneficially own an aggregate of 4,362,026 shares of ESSA Pharma, Inc. Common Stock.
• This ownership represents approximately 9.8% of the outstanding shares, based on 44,388,550 shares issued and outstanding as of May 7, 2025.
• On July 17, 2025, Master Fund unwound a previously disclosed cash-settled swap transaction involving 2,100,000 shares of Common Stock.
• Immediately following the swap unwind, Master Fund acquired 2,100,000 shares of Common Stock from the counterparty in a private transaction.
• The acquisition price was $1.87 per share, totaling approximately $3,927,000, funded by cash from Master Fund's working capital.
• The Reporting Persons disclaim beneficial ownership of an additional 1,875,351 shares of Common Stock to which Master Fund has economic exposure through ongoing cash-settled swap transactions, as these do not confer voting or dispositive power.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive from the perspective of the reporting entity, Soleus Capital, as they have increased their direct equity stake in ESSA Pharma, converting economic exposure into direct ownership, which typically signals increased conviction. There are no negative disclosures about ESSA Pharma itself within this filing.

Positives

• Soleus Capital Master Fund's direct acquisition of 2.1 million shares indicates a conversion of economic exposure to direct equity ownership, potentially signaling increased conviction in ESSA Pharma's long-term prospects.
• The acquisition was funded by cash from working capital, suggesting financial liquidity for the investment.

Negatives

• The filing does not present any explicit negative information regarding ESSA Pharma, Inc. from the perspective of the reporting entity.

Risks

• The Reporting Persons disclaim beneficial ownership of shares subject to cash-settled swap transactions, meaning they do not have voting or dispositive power over these shares, which could limit their influence despite economic exposure.
• The value of the investment is subject to market fluctuations of ESSA Pharma's Common Stock.

Future Outlook

The document indicates that Master Fund may enter into additional swap transactions or terminate existing swap transactions at any time, suggesting flexibility in managing its economic exposure to ESSA Pharma.

Industry Context

This filing reflects an investment firm's strategic positioning in a biotechnology company, a common practice in the pharmaceutical sector where institutional investors take significant stakes in companies with promising drug pipelines or technologies. The conversion from swap exposure to direct equity ownership could be seen as a more committed long-term investment in the biotech space.

Comparison to Industry Standards

• The 9.8% stake is a significant minority position, typical for activist or strategic investors seeking influence without outright control. For instance, similar stakes are often seen in biotech companies where investors aim to support or influence clinical trial progress or strategic partnerships.
• The use of cash-settled swaps for economic exposure is a standard financial instrument for institutional investors to gain exposure without immediate beneficial ownership, often used to manage capital efficiency or regulatory thresholds, similar to practices by hedge funds investing in companies like Moderna or BioNTech during their development phases.

Related Party Transactions

• The Joint Filing Agreement, dated April 15, 2025, among the Reporting Persons, indicates a coordinated approach to their investment and reporting obligations.

Stakeholder Impact

• Shareholders: The increased direct ownership by Soleus Capital could be viewed positively as a vote of confidence, potentially influencing market perception and share price.
• Management: Soleus Capital's significant stake may lead to increased engagement or influence on corporate strategy and governance.

Next Steps

• Master Fund may enter into additional swap transactions or terminate existing swap transactions at any time.
• The Reporting Persons may continue to evaluate their investment in ESSA Pharma, Inc. and may engage in discussions with management or the board regarding strategic alternatives or other matters.

Key Dates

Recommendation

Keywords

ESSA Pharma, Soleus Capital, Schedule 13D, Beneficial Ownership, Common Stock, Equity Stake, Swap Transaction, Investment, Biotechnology, Pharmaceuticals