S-1/A: GT Biopharma Seeks Up to $8 Million in Public Offering to Advance Immuno-Oncology Pipeline

GT Biopharma is launching a public offering of common stock and warrants to raise capital for the development of its TriKE and Dual Targeting TriKE immuno-oncology products.

Summary

• GT Biopharma is undertaking a public offering to sell up to 3,361,344 shares of common stock along with common warrants to purchase an equal number of shares.
• The assumed combined public offering price is $2.38 per share and common warrant, based on the last reported sale price on January 23, 2025.
• Pre-funded warrants are also being offered to purchasers who would exceed beneficial ownership limits of 4.99% or 9.99%, with an exercise price of $0.0001 per share.
• The offering includes placement agent warrants to purchase up to 201,680 shares, representing 6% of the aggregate shares and pre-funded warrants sold.
• Roth Capital Partners, LLC is acting as the exclusive placement agent for the offering, which is on a reasonable best efforts basis.
• The offering will terminate no later than February 28, 2025, and the company estimates net proceeds of approximately $7.1 million, excluding proceeds from warrant exercises.
• The funds are intended for working capital and general corporate purposes, including the development of clinical and pre-clinical product candidates.
• The company is a smaller reporting company and has a history of operating losses, with a net loss of approximately $9.4 million for the nine months ended September 30, 2024.
• GT Biopharma's financial condition raises substantial doubt about its ability to continue as a going concern.
• The company is advancing GTB-3650 to clinical studies based on pre-clinical data showing a marked increase in potency compared to GTB-3550, which they anticipate could lead to an enhanced efficacy signal in AML and MDS.
• GT Biopharma is advancing GTB-5550 through preclinical studies and initiated a GMP manufacturing campaign in anticipation of filing an IND in the first half of 2025.

Sentiment

Score: 5

Explanation: The document presents a mix of positive and negative aspects. The capital raise is a positive step for funding the pipeline, but the company's financial condition and history of losses are concerning. The potential of the TriKE technology is promising, but clinical development is inherently risky.

Positives

• The offering will provide additional capital to advance the development of GT Biopharma's product candidates.
• GTB-3650 is advancing to clinical studies based on pre-clinical data showing a marked increase in potency compared to GTB-3550.
• GTB-5550 is advancing through preclinical studies with a GMP manufacturing campaign initiated in anticipation of filing an IND in the first half of 2025.
• The company has exclusive rights to the TriKE platform and is generating additional intellectual property for specific moieties.

Negatives

• The company has a history of operating losses and expects to continue to incur losses for the foreseeable future.
• GT Biopharma's financial condition raises substantial doubt about its ability to continue as a going concern.
• The company may sell fewer than all of the securities offered, which may significantly reduce the amount of proceeds received.
• There is no established public trading market for the common warrants or pre-funded warrants, and the company does not expect a market to develop.

Risks

• The company's financial condition raises substantial doubt as to its ability to continue as a going concern.
• The cost of research and development programs may be significantly higher than expected.
• Clinical drug development is costly, time-consuming and uncertain, and the company may suffer setbacks in its clinical development program.
• The company may expend its limited resources to pursue a particular product candidate or indication that does not produce any commercially viable products.
• The company currently lacks manufacturing capabilities to produce its therapeutic product candidates at commercial-scale quantities and does not have an alternate manufacturing supply.
• The company's failure to maintain compliance with the Nasdaq Capital Markets (Nasdaq) continued listing requirements could result in the delisting of its common stock.

Future Outlook

The company intends to use the net proceeds from this offering for working capital and general corporate purposes, including the further development of its product candidates that are currently undergoing clinical trials, its product candidates that it expects to submit an investigational new drug application for in the near term, and its product candidates that are pre-clinical.

Industry Context

The company operates in the competitive immuno-oncology space, focusing on novel therapies that harness the power of natural killer cells to target cancer. The TriKE and Dual Targeting TriKE platforms represent a unique approach compared to traditional T-cell immunotherapies, potentially offering a safer alternative with reduced cytokine release syndrome and neurological complications.

Comparison to Industry Standards

• GT Biopharma's TriKE technology competes with other immuno-oncology approaches, including CAR-T therapies from companies like Novartis (Kymriah) and Gilead (Yescarta).
• Unlike CAR-T therapies that require patient-specific customization, TriKEs are designed to target a range of tumor antigens without customization, potentially offering a more scalable and cost-effective solution.
• The company's focus on NK cell-based therapies aligns with a growing interest in this area, with companies like Fate Therapeutics and Nkarta Therapeutics also developing NK cell-based cancer treatments.
• GT Biopharma's approach of activating endogenous NK cells may offer a safety advantage compared to CAR-T therapies, which have been associated with cytokine release syndrome and neurotoxicity.
• The company's preclinical data suggests that TriKEs have little effect on endogenous T cells, which may contribute to the reduced risk of CRS.

Related Party Transactions

• During the nine months ended September 30, 2024 and 2023, the Company recognized research and development expenses of $1,365,000 and $3,691,000, respectively and made cash payments amounting to $3,432,000 and $1,710,000, respectively to Cytovance.
• In addition, the Company issued 127,597 and 57,437 shares of common stock to Cytovance to settle accounts payable valued at approximately $810,000 and $1,120,000, respectively.
• As of September 30, 2024 the Companys commitments in relation to unbilled and unaccrued SOWs and any related Change Orders from Cytovance for services that have not yet been rendered as of September 30, 2024, amounted to approximately $1.3 million.
• As of September 30, 2024 and December 31, 2023, accounts payable to Cytovance amounted to $638,000 and $3,515,000, respectively.

Stakeholder Impact

• Shareholders will experience dilution as a result of the public offering.
• Employees may benefit from the increased funding for research and development.
• Patients with hematologic malignancies and solid tumors may benefit from the development of new therapies.
• Suppliers and creditors may benefit from the company's ability to meet its financial obligations.

Next Steps

• Complete the public offering and secure the intended net proceeds.
• Advance GTB-3650 through clinical trials for relapsed/refractory AML and high grade MDS.
• File an Investigational New Drug (IND) application for GTB-5550 in the first half of 2025.
• Continue preclinical studies for GTB-5550 and GTB-7550.

Key Dates

Keywords

GT Biopharma, public offering, immuno-oncology, TriKE, warrants, GTB-3650, GTB-5550, capital raise, biopharmaceutical, clinical trials