[Funding] FutureChem Reduces Fundraising Scale Amid Stock Market Slump

Plan to Raise 45 Billion KRW at Board Resolution → Finalized Issue Price Raises 31.1 Billion KRW
15% Fee Paid if Residual Shares Occur After Public Offering
Operating Expenses Budget Reduced from Plan... Monthly Average Spending 980 Million KRW

[Asia Economy Reporter Hyungsoo Park] Amid continued sluggishness in the domestic stock market, FutureChem, a developer of radiopharmaceuticals, has encountered difficulties in raising funds. The scale of fundraising has decreased as the stock price fell compared to when the board of directors resolved the rights offering.

According to the Financial Supervisory Service's electronic disclosure system on the 14th, FutureChem will issue 3.31 million new shares to raise 31.1 billion KRW. Subscription was conducted for existing shareholders from the 12th to the 13th, and a general public offering subscription will be held for two days starting from the 17th for any unsubscribed shares. If there are remaining shares after the general public offering subscription, Korea Investment & Securities and Kiwoom Securities will underwrite them.

Earlier, on July 4th, FutureChem held a board meeting and resolved the rights offering agenda. The plan was to issue 0.24 new shares per existing share to raise funds. The planned issue price was 13,600 KRW per new share, with an expected total fundraising of 45 billion KRW.

Since the announcement of the rights offering plan, FutureChem's stock price has dropped by about 40% over three months. The initial issue price and the final issue price were lowered to 12,150 KRW and 9,390 KRW, respectively. The fundraising amount decreased to 31 billion KRW, about 14 billion KRW less than originally planned.

FutureChem revised its fund usage plan. The clinical trial budget remains at 23 billion KRW, while the operating funds budget, including purchase payments and labor costs, was reduced from 22 billion KRW to 8 billion KRW.

FutureChem is currently conducting clinical trials for its prostate cancer treatment (FC705). In May, it received approval for the Phase 1/2a clinical trial plan (IND) from the U.S. Food and Drug Administration (FDA). According to the plan, clinical trials will be conducted on 26 patients at six institutions in the U.S. FC705 targets the prostate-specific membrane antigen (PSMA) protein expressed in prostate cancer. It is a next-generation radiopharmaceutical candidate expected to treat prostate cancer through injection without surgery. Interim results from the Phase 1 clinical trial conducted domestically confirmed that effective treatment was possible with a lower dose compared to competitors. Approximately 20 billion KRW is expected to be spent on clinical trials conducted in both the U.S. and Korea. The remaining 3 billion KRW will be used for clinical costs related to the prostate cancer diagnostic agent.

FutureChem has fixed monthly expenditures of approximately 980 million KRW for raw materials, labor, and general expenses. It expects meaningful sales to begin in the first half of 2024 if clinical trials proceed as planned. Due to setbacks in the fundraising plan, the company plans to cover the shortfall in operating expenses with its own funds. However, if there are remaining shares in the general public offering subscription, the net proceeds from the rights offering may decrease further. A 15% underwriting fee on the remaining shares must be paid to the underwriters, which could reduce the operating budget by the amount of the underwriting fee.

This content was produced with the assistance of AI translation services.