FSD Pharma Inc. (NASDAQ:HUGE) (CSE:HUGE) said it has entered into an equity sales agreement with A.G.P./Alliance Global Partners covering the sale of Class B subordinate voting shares of the company on an 'at-the-market' basis.
The company said it expects to use any net proceeds of the offering to finance future growth opportunities, including acquisitions and investments, to finance its capital expenditures, for working capital purposes or for general corporate purposes, and in particular, to continue advancement of the near-term objectives with respect to its R&D program for the commercialization of ultramicronized-palmitoylethanolamide (FSD201).
READ: FSD Pharma says first patient dosed in Phase 2a clinical trial of FSD201 to treat hospitalized patients with COVID-19
The company said no offers or sales of Class B shares will be made in Canada on the Canadian Securities Exchange or other trading markets in Canada. The sales, if any, of Class B shares made under the sales agreement with A.G.P./Alliance Global Partners will be made by means of ordinary brokers' transactions on the Nasdaq at prevailing market prices for the Class B shares at the time of sale, or as otherwise agreed upon by the company and the sales agent.
The offering is being made by way of a prospectus supplement dated February 11, 2021, covering the sale of up to US$20 million of Class B shares to the company's existing US registration statement on Form F-10 and Canadian short form base shelf prospectus, each dated June 16, 2020.
The company's wholly-owned subsidiary, FSD Pharma BioSciences, Inc. is a specialty biotech pharmaceutical R&D company focused on developing over time multiple applications of its lead compound, FSD201, by down-regulating the cytokines to effectuate an anti-inflammatory response.
The company filed an IND with the US Food and Drug Administration (FDA) on August 28, 2020, and was approved on September 25, 2020, to initiate a phase 2 clinical trial for the use of FSD201 to treat coronavirus (COVID-19), the disease caused by the SARS-CoV-2 virus.
Severe COVID-19 is characterized by an over-exuberant inflammatory response that may lead to a cytokine storm and ultimately death. The company is focused on developing FSD201 for its anti-inflammatory properties to avoid the cytokine storm associated with acute lung injury in hospitalized COVID-19 patients.
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