Form 4: OrbiMed Boosts Shattuck Labs Stake in Private Placement

OrbiMed Advisors and its affiliates significantly increased their beneficial ownership in Shattuck Labs, Inc. through a private placement of common stock and warrants.

Summary

• OrbiMed Advisors LLC, OrbiMed Capital GP IX LLC, and OrbiMed Genesis GP LLC, who are directors and 10% owners of Shattuck Labs, Inc. (STTK), acquired additional securities.
• The transaction, a private placement, closed on August 25, 2025.
• Acquired 6,306,127 shares of common stock at a price of $0.8677 per share.
• Acquired 12,133,661 pre-funded warrants to purchase common stock at an exercise price of $0.0001 per share. The price for each pre-funded warrant and accompanying common warrant was $0.8676.
• Acquired 18,439,788 common warrants to purchase common stock at an exercise price of $1.0846 per share. The price for each share and accompanying common warrant was $0.8677.
• The pre-funded warrants are exercisable immediately and expire upon full exercise, while the common warrants are exercisable immediately and expire 30 days after the public announcement of Phase 1 clinical trial data for SL-325 and the design of planned Phase 2 trials.
• All warrants are subject to a 9.99% beneficial ownership blocker.
• The securities are held indirectly through OrbiMed Private Investments IX, LP and OrbiMed Genesis Master Fund, L.P.

Sentiment

Score: 8

Explanation: The significant investment by a major institutional investor and existing director/10% owner, OrbiMed, through a private placement, indicates strong confidence in Shattuck Labs' future and provides crucial capital for advancing its clinical pipeline. While there is potential for dilution, the overall sentiment is positive due to the vote of confidence and funding.

Positives

• Significant investment by a major institutional investor and existing 10% owner/director, indicating strong confidence in Shattuck Labs' future.
• The capital raise provides Shattuck Labs with additional funding, which is crucial for biotech companies, especially for advancing clinical trials.
• The structure of the warrants (pre-funded with low exercise price, common warrants tied to clinical trial data) suggests strategic alignment with the company's development milestones.

Negatives

• The issuance of new shares and warrants could lead to dilution for existing shareholders if all warrants are exercised.

Risks

• The expiration of common warrants is tied to the public announcement of Phase 1 clinical trial data for SL-325 and the design of planned Phase 2 trials. Failure to achieve positive results or delays in these announcements could impact the value and exercise of these warrants.
• The 9.99% beneficial ownership blocker on warrants could limit the immediate conversion of a large number of shares, potentially affecting liquidity or control.

Future Outlook

The common warrants' expiration is tied to the public announcement of Phase 1 clinical trial data for SL-325, including receptor occupancy and safety data, and the design of planned Phase 2 clinical trials. This indicates a future focus on these specific clinical milestones.

Management Comments

• Each of the Reporting Persons disclaims beneficial ownership of the securities reported herein for purposes of Rule 16a-1(a) under the Securities Exchange Act of 1943, as amended (the "Exchange Act"), except to the extent of its pecuniary interest therein, if any.
• OrbiMed Advisors has designated a representative, Mona Ashiya, a member of OrbiMed Advisors, to serve on the Issuer's board of directors.
• This report shall not be deemed an admission that any of the Reporting Persons or Ashiya is a beneficial owner of such securities for purposes of Section 16 of the Exchange Act, or for any other purpose.

Industry Context

In the biotech industry, capital raises, especially from institutional investors with deep industry knowledge like OrbiMed, are common and often viewed positively. Such investments provide essential funding for research and development, particularly for advancing drug candidates through costly clinical trials. The structure with warrants tied to clinical milestones is a common way for investors to participate in potential upside while providing capital.

Comparison to Industry Standards

• The private placement structure with common stock and warrants is a standard financing mechanism for early to mid-stage biotech companies.
• The involvement of a specialized healthcare investment firm like OrbiMed, which often takes board seats, aligns with typical industry practices for strategic investors.
• Tying warrant expiration to clinical trial data announcements (e.g., Phase 1 results for SL-325) is a common incentive structure, aligning investor interests with key R&D milestones, similar to how other biotech companies might structure financing rounds with milestones for drug development.

Management Changes

Corporate Governance

Related Party Transactions

• The private placement involved OrbiMed Advisors LLC and its affiliates, who are identified as a Director and 10% Owner of Shattuck Labs, Inc. This constitutes a related party transaction.

Stakeholder Impact

• Shareholders: Potential for dilution from the issuance of new shares and future exercise of warrants. However, the capital raise and vote of confidence from a major investor could positively impact share price and company stability.
• Company (Shattuck Labs): Receives significant capital to fund operations and advance its clinical pipeline, particularly the SL-325 program.
• OrbiMed Advisors and Affiliates: Increased their stake in Shattuck Labs, aligning their financial interests with the company's success, particularly its clinical milestones.

Next Steps

• Public announcement of Phase 1 clinical trial data for SL-325, including receptor occupancy and safety data.
• Public announcement of the design of planned Phase 2 clinical trial(s) for SL-325.
• Exercise of pre-funded and common warrants by the reporting persons.

Key Dates

Recommendation

The substantial investment by OrbiMed, a sophisticated institutional investor with a director on the board, signals strong conviction in Shattuck Labs' future prospects and its clinical pipeline, especially SL-325. This capital infusion provides critical funding for the company's R&D efforts. While dilution is a factor, the vote of confidence from a major player in the biotech investment space, coupled with the strategic nature of the warrant terms, suggests a positive outlook and potential for significant upside.

Keywords

Shattuck Labs, STTK, OrbiMed Advisors, private placement, common stock, pre-funded warrants, common warrants, capital raise, biotech, clinical trials, SL-325, institutional investment, insider buying, Form 4