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Sierra nets $98.4mm in preferred stock public offering tied to agreement for Gilead's momelotinib

Executive Summary

Sierra Oncology Inc. netted $98.4mm through the sale of 103k Series A convertible preferred shares (each converts into TK common) at $1k and accompanying Series A and Series B warrants. The Series A warrants are for the purchase up to 312mm common shares at an exercise price equal to $0.33 per underlying common share while the Series B warrants enable the purchase of up to 103mm common shares at the same exercise price as the Series A warrants. The company will appoint to its board four new directors affiliated with Vivo Capital, Longitude Capital, OrbiMed, and Abingworth, all of which are investors in this offering. Sierra will use the proceeds to fund MOMENTUM, a Phase III study of its momelotinib (a JAK1, JAK2, and ACVR1 inhibitor) in myelofibrosis, which is expected to begin in Q4 2019. Concurrent with the closing of the financing, Sierra is revising its 2018 agreement with Gilead Sciences, from which it in-licensed worldwide development and commercialization rights to momelotinib. The amendment to the alliance calls Gilead to take a minority equity stake in Sierra in exchange for a reduction of the annual royalty rates and the elimination of a $5mm milestone payment (payable upon the start of the MOMENTUM trial) due under the original deal.
Deal Industry
  • Biotechnology
    • Antisense, Oligonucleotides
    • Large Molecule
    • Liposomes
  • Pharmaceuticals
    • Drug Delivery
      • Macromolecule
Deal Status
  • Final
Deal Type
  • Financing
    • FOPO
    • Other

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