TONIX Pharmaceuticals, a New York-based specialty pharmaceutical company (TNXP.OB), focused on developing therapies to treat central nervous system conditions such as fibromyalgia (FM) and post-traumatic stress disorder (PTSD), just completed a $4.3 million private placement offering to institutional and accredited investors.
The company received net proceeds of approximately $1.9 million in the offering and converted an additional $1.9 million in previously convertible debentures as part of the offering.
To round out the closing, the company issues 172 units valued at $25,000 per unit. Each unit consisted of 25,000 Class A common stock warrants valued at $1.25 (exercise price) per share good for five years. The Class B shares will be exercised automatically on their expiration date by cashless exercise or expire without exercise.
The company currently has two products in development: TNX-102 for the treatment of fibromyalgia (FM) and TNX-105 for the treatment of post-traumatic stress disorder (PTSD).
Part of the proceeds from this offering will be used to fund the TNX-102 pharmacokinetic study and the first pivotal trial. Other funds will be used to fund other product candidates including TNX-105 and to repay debt, interest and as general working capital.
Fibromyalgia, which is the focus of TNX-102 trials, affects about 5 million Americans ages 18 and up each year. This condition is characterized by long-term pain in the muscles, joints, tendons and other soft tissues. While the cause of FM is unknown, treatment is focused on managing pain and other symptoms.
TNX-102 is part of that pain management. By focusing research on a “classic” and widely prescribed, FDA-approved muscle relaxant – Cyclobenzaprine – and its bedtime use, Tonix hopes to help patients reduce musculoskeletal pain and sensitivity, fatigue and altered mood.
Cyclobenzaprine binds to serotonin reactor type 2a (5HT2a) and blocks signaling. Even though scientists have not determined the exact mechanism for this blocked signaling, a recent study with the drug at bedtime reported improved FM outcomes.
The same ingredient may bring similar outcomes to PTSD patients because the symptoms have parity with FM. TNX-102 trials should begin this year.