Novan has entered into a common stock purchase agreement with Aspire Capital Fund, LLC, a Chicago-based institutional investor. The agreement provides additional financing to fund Novan’s nitric oxide technology platform, which has potential indications in dermatology, women’s health and gastroenterology. The company currently has four nitric oxide-based products with dermatologic indications in the pipeline, including SB204 for acne, SB206 for molloscum, SB208 for tinea pedis, and SB414 for the treatment of atopic dermatitis and psoriasis.
Under the terms of the agreement, Aspire Capital has committed to purchase up to $25 million of common stock of Novan. These purchases would occur at Novan’s discretion from time to time during a 30-month period beginning on the effective date of a registration statement filed by Novan with the Securities and Exchange Commission related to the resale of shares to be issued to Aspire Capital.
“This agreement with Aspire Capital provides Novan with an additional financing tool in the toolbox to both complement nondilutive capital and allow us to fund specific business platform initiatives,” said Kelly Martin, CEO of Novan. “The benefit of the agreement is two-fold; it brings in a fundamentally-focused, long-term institutional investor and, as a micro-cap company, allows us to efficiently and opportunistically draw down capital over the next 30 months in a way that will help minimize our overall cost of capital and potential dilution.”
“Novan has, first and foremost, the potential to build-out a unique nitric oxide technology platform that could have clinical applications in any number of therapeutic areas. With compelling clinical data from over 3,000 patients in-hand and several late stage assets, we have a high degree of enthusiasm in reaching this agreement with the company,” said Steven Martin, managing member of Aspire Capital.