F-1/A: Evaxion Biotech A/S Announces Proposed Public Offering of ADSs and Pre-Funded Warrants

Evaxion Biotech A/S is proposing a public offering of up to 7,530,120 American Depositary Shares (ADSs) and pre-funded warrants to purchase up to 7,530,120 ADSs.

Summary

• Evaxion Biotech A/S is planning to offer up to 7,530,120 American Depositary Shares (ADSs), each representing ten ordinary shares, and pre-funded warrants to purchase up to 7,530,120 ADSs.
• The offering is on a best efforts basis, with the final price to be determined through negotiations between the company, the placement agent, and investors.
• Pre-funded warrants are being offered to certain purchasers who would otherwise exceed beneficial ownership limits of 4.99% or 9.99% of the company's outstanding ordinary shares.
• The price of each pre-funded warrant will be the price of an ADS minus $1.42, with an exercise price of $1.42 per ADS, subject to a minimum exercise price equal to the USD equivalent of DKK 10 at the time of exercise.
• The offering is set to terminate on December 31, 2024, but may be terminated earlier at the company's discretion.
• The ADSs are currently listed on the Nasdaq Capital Market under the symbol EVAX, with a closing price of $1.66 per ADS on November 29, 2024.
• Lake Street Capital Markets, LLC is acting as the exclusive placement agent for the offering.
• The company will pay the placement agent a cash fee equal to 7.0% of the gross proceeds raised in the offering, plus up to $100,000 for legal fees and expenses.
• The company estimates total offering expenses, excluding the placement agent fee, to be approximately $0.7 million.
• There is no minimum offering amount required for the closing of this offering, and the company may sell fewer than all of the securities offered.
• The company intends to use the net proceeds from the offering to advance its preclinical and clinical pipeline, and for continuing operating expenses and working capital.

Sentiment

Score: 5

Explanation: The document presents a mixed picture. While the company highlights its innovative technology and partnerships, it also acknowledges significant financial challenges and risks, including a delisting notice from Nasdaq. The sentiment is therefore neutral to slightly negative.

Positives

• The company has a clinical-stage cancer pipeline of novel personalized therapeutic vaccines and a preclinical prophylactic vaccine pipeline for bacterial and viral diseases.
• The company's AI-Immunology platform has been preclinically and clinically validated, is adaptable, and scalable to other disease areas.
• The company has a strong focus on partnering as part of its strategy execution.
• The company has a significantly expanded partnership with MSD, validating the value of its AI-Immunology platform.
• The company has a multidisciplinary capability set spanning the full value chain from target discovery to early clinical development.
• The company has a state of art wet-lab and animal facility for rapidly validating AI predictions.
• The company has a strong patent portfolio and intellectual property protection strategy.

Negatives

• The company has incurred significant losses since its inception and anticipates continuing to incur losses.
• The company will require substantial additional financing to achieve its goals.
• The company is subject to reduced public company reporting requirements as a foreign private issuer and an emerging growth company.
• The company is subject to a delisting notice from Nasdaq Capital Markets and is pursuing an additional 180-day exemption.
• The company's business model is based upon partnering, and there is no guarantee that it will be able to secure needed partnerships.
• The company relies on third parties for manufacturing and clinical trials, which could lead to delays.
• The company may encounter difficulties in manufacturing personalized products.
• The company may be involved in lawsuits to protect or enforce its intellectual property.

Risks

• The company is not in compliance with Nasdaq listing requirements and faces potential delisting.
• The company has a limited operating history and only two product candidates in early clinical trials.
• The company has incurred significant losses and anticipates continuing to incur losses.
• The company will require substantial additional financing to achieve its goals, which may not be available.
• The company may encounter difficulties in managing its development and expansion.
• Pharmaceutical product development is inherently uncertain, and there is no guarantee of regulatory approval.
• The company's product candidates may not work as intended or may cause undesirable side effects.
• The company faces significant competition in an environment of rapid technological and scientific change.
• The company relies on third parties for manufacturing and clinical trials, which could lead to delays.
• The company may encounter difficulties in manufacturing personalized products.
• The company may be involved in lawsuits to protect or enforce its intellectual property.

Future Outlook

The company plans to continue its multi-partner approach to value realization, advance the EVX-01 phase 2 trial, strengthen its AI-Immunology platform, and progress its ERV-based precision vaccine concept towards clinical development. The company also aims to advance existing partnerships, including bringing the MSD collaboration to option exercise.

Management Comments

• Christian Kanstrup, CEO, has more than 25 years of experience in the life science industry.
• The company is excited about the commercial potential of EVX-01.
• The company is thrilled about the interest it is seeing from potential partners.
• The company is excited about its significantly expanded vaccine collaboration with MSD and the financial and strategic value it brings.

Industry Context

The document highlights the company's position in the competitive biotechnology and pharmaceutical industries, particularly in the areas of AI-driven drug discovery and vaccine development. The company is focused on personalized and precision medicine, which is a growing trend in the industry. The company's AI-Immunology platform and its ability to identify novel targets for drug development are key differentiators in the market.

Comparison to Industry Standards

• The company's AI-Immunology platform offers a 90%+ cost reduction in target identification compared to reverse vaccinology.
• The company's AI-Immunology platform requires testing only 20% of targets compared to reverse vaccinology.
• The company's EVX-01 Phase 1 trial demonstrated a clear link between the quality of AI predictions and progression-free survival in metastatic melanoma patients, which is a first in the world.
• The company's EVX-01 Phase 2 one-year clinical data showed a 69% Overall Response Rate, which compares favorably to other approaches.
• The company's AI-DeeP model can pinpoint 10-30% of non-responsive cases with a precision of 95%, compared to 70-80% precision achieved by traditional biomarkers.
• The company's EDEN model has identified novel vaccine antigens for seven bacteria pathogens, demonstrating protection in pre-clinical mouse infection models.
• The company's RAVEN model identified 17 T-cell epitopes across the SARS-CoV-2 genome, with 15 epitopes inducing T-cell activation and providing significant protection against lethal SARS-CoV-2 challenge in a mouse model.

Management Changes

Legal Proceedings

• In April 2022, SSI initiated a legal proceeding against the company claiming sole ownership of a patent application, which was resolved in June 2024 with the company retaining all commercial rights.

Stakeholder Impact

• Shareholders face the risk of potential delisting and dilution.
• Employees may be affected by the company's financial challenges and potential restructuring.
• Customers may benefit from the company's innovative treatments, but face uncertainty due to the company's financial situation.
• Suppliers and creditors may be affected by the company's financial challenges and potential restructuring.

Next Steps

• The company will continue its multi-partner approach to value realization.
• The company will continue the ongoing EVX-01 phase 2 trial.
• The company will continue strengthening its AI-Immunology platform.
• The company will further advance its research activities, including progressing its ERV-based precision vaccine concept towards clinical development.
• The company will advance existing partnerships, including bringing the MSD collaboration to option exercise.

Key Dates

Keywords

AI-Immunology, vaccine, cancer, infectious disease, ADS, pre-funded warrants, Nasdaq, clinical trial, biotech, drug development