(News Bulletin 247) – The biotechnology company raised 61.2 million euros in an express fundraising round, with a view to financing the development of its clinical programs for its vaccines against chikungunya and against Shigellosis and the Zika virus.

Valneva is gradually shedding its “Covid value” reputation, which had stuck to it between 2020 and 2021. The biotechnology company has been marketing its chikungunya vaccine in the United States for adults since the end of 2023, while the first sales in Canada and Europe should occur in the fourth quarter.

Valneva intends to put all the chances on its side to offer a commercial destiny to its other vaccine candidates, like the one developed against Lyme disease, a systemic infection caused by a bacteria transmitted to humans by ticks.

And this is done through fundraising. Valneva explains that it has carried out a flash capital increase to finance its clinical programs, including in particular the Phase III pediatric trial (the last stage of clinical trials before possible marketing) and the Phase IV trials (a trial that allows the use of the drug to be monitored in the long term, under real-world conditions of use) of its vaccine against chikungunya, as well as the anticipated Phase II trials (an intermediate stage that aims to demonstrate the efficacy of a treatment) of its programs for vaccine candidates against Shigellosis and the Zika virus.

A fundraising of 61.2 million euros

A portion of the funds raised will be dedicated to supporting the commercialization of its current chikungunya vaccine, Ixchiq, as well as funding preclinical research and development activities, and general corporate purposes.

Valneva has thus managed to raise 61.2 million euros. The company also indicates that the fundraising was carried out at a price of 2.66 euros per share, representing a discount of nearly 15.4% compared to Thursday evening’s closing price of 3.138 euros. The share is currently down 10% to 2.82 euros at around 11:20 a.m. after this transaction. The settlement-delivery of the New shares and their admission to trading on the regulated market of Euronext Paris are scheduled for September 17, 2024.

The company warns of the dilutive effect of this operation. As an illustration, a shareholder who held 1% of the company’s capital before the launch of the capital increase will see his stake reduced to 0.86% at the end of this fundraising.

The transaction announced today will give Valneva “greater flexibility to invest in its future growth”, including in its Shigellosis vaccine program for which it recently obtained an exclusive worldwide license.

Shigellosis is a highly contagious diarrheal disease caused by bacteria called Shigella, responsible for epidemics across the world, explains the Pasteur Institute.

Lyme disease vaccine, an “asset” for Valneva

Valneva also said it has the resources to fund its operating activities, and indicated that the funds raised will not be dedicated to debt repayment. The company’s debt reduction will be driven by “potential milestone and commercial revenues from its Lyme disease program” that “enable it to operate in a sustainable profitable manner.”

As of the end of June, the company’s debt stood at $200 million. The repayment of the first tranche of $100 million will begin in January 2026 and end in the first quarter of 2027. The repayment of the second tranche of $100 million will begin in the first quarter of 2027 and end in the fourth quarter of 2028.

The company took advantage of this announcement to recall the latest clinical developments for its candidate vaccine against Lyme disease.

The completion of the phase III Valor trial with its partner Pfizer is still expected at the end of 2025, with the aim of the American giant submitting a marketing authorization application (BLA) to the American health agency FDA and a marketing authorization application (MAA) to the European Medicines Agency in 2026, provided that the data obtained are positive.

The company’s “main asset, the Lyme disease vaccine candidate” could help support the stock over time, Kempen analysts had estimated in mid-August, reacting to the group’s half-year results. Valneva had then renewed its annual outlook, after returning to profit in the first half.