Here’s why the Race Oncology (ASX:RAC) share price is edging higher

Two scientists in a Rhythm Biosciences lab cheer while looking at results on a computer.

The Race Oncology Ltd (ASX: RAC) share price is climbing today on the back of the company’s latest capital raise.

During morning trade, the pharmaceutical company’s shares are up 3.64% to $3.42 apiece.

What did the company announce?

Investors are driving up the Race Oncology share price following the company’s strongly supported share purchase plan (SPP).

According to its release, Race Oncology advised it has successfully completed its SPP, raising $29.7 million after a scale back. This represents around 6.6% of the company’s issued capital as of today. The offer received strong support from 2,340 shareholders, who applied for more than $43.9 million under the SPP.

The retail component of the company’s equity raising efforts will see 9.9 new million shares created at $3 each.

The funds raised will go towards a number of company programs. These include:

  • Phase 1b/2 FTO solid tumour clinical trial ($8 million);
  • Cardio-protection Phase 2b clinical trial in breast cancer patients ($7.5 million);
  • Phase 2 EMD AML/MDS clinical trial in Europe ($9.2 million);
  • Improved formulations of Zantrene ($3.2 million);
  • Preclinical cardio-protection studies ($1 million); and
  • Development of new molecules ($0.8 million).

The SPP shares are expected to be issued today, and be available for trading from tomorrow.

Race Oncology managing director and CEO Phil Lynch commented:

The number of applications reflects enthusiasm for the significant potential of our lead drug Zantrene, and this enables us to implement our planned clinical and drug development plans across the three-pillar program. We move into 2022 in an exceptional position, with many critical, reportable milestones ahead of us.

Race Oncology share price snapshot

The Race Oncology share price has gained more than 97% in the past 12 months and is up by 95% year to date.

Based on today’s price, Race Oncology has a market capitalisation of about $493 million, with 149.54 million shares on issue.

The post Here’s why the Race Oncology (ASX:RAC) share price is edging higher appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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