GW Pharmaceuticals (GWPH) fell almost 4% in after-hours trading after the British biotech company said it would sell $225 million of American Depositary Shares (ADSs) on the NASDAQ exchange in an underwritten U.S. public offering.
GW expects to grant the underwriters a 30-day option to purchase up to an additional $33.75 million of ADSs at the offering price. The price for the offering has not been set. Goldman Sachs & Co. LLC, Morgan Stanley, BofA Merrill Lynch and Cowen are acting as joint book-running managers for the offering.
The company just reported its earnings on Monday in which it said that 2018 would be pivotal year. During the company’s earnings conference call, chief financial officer Scott Giacobello said, “We expect spending to continue at a similar rate for the first six months of fiscal year 2018 and therefore anticipate total cash outflows for the first half of the year in the range of 75 million to 95 million pound sterling or $100 million to $120 million based on today’s prevailing currency exchange rates. This includes capital expenditure of $10 million to $20 million related to manufacturing expansion. Thereafter, if Epidiolex is approved, we expect cash outflows to increase in preparation for product launch and we’ll update guidance at that time.”
Chief executive officer Justin Glover gave comments on the coming year by saying, “With our NDA now submitted to the FDA, the commercial and medical affairs teams are actively preparing for the potential U.S. approval and launch in 2018. Looking out through 2018, our key priorities include continued visibility at major U.S. medical congresses, and AES being one of the best examples of this initiative. Our company has a major presence at the AES meeting including the scientific exhibit this morning where we are showcasing 22 posters on CBD, a considerable body of clinical and scientific work.”
The stock closed at approximately $119 on Tuesday before the news was announced. The stock has been recovering from a 52-week low of $92 that it hit during the summer. The 52- week high was $136.