Oncology company MAIA advances on news of private placement

Shares of MAIA Biotechnology, a company with a market capitalization of $65 million that develops therapies for cancer, surged more than 8% on Tuesday, October 29, following the announcement of a private placement, which included certain insiders and is expected to raise $2.44 million. 

Details

On Tuesday, MAIA stock gained more than 8% on the NYSE to $2.72 per share. Since the beginning of the year, it is up over 132%.

Before the opening bell, the company announced it had entered into agreements to sell 1.08 million shares at $2.23 per share in a private placement. According to a filing submitted to the U.S. SEC, most of these shares — nearly 847,000 — were allocated to accredited investors, while some members of the MAIA board bought the remaining 232,800 shares. Each share is being sold with a five-year warrant, exercisable beginning six months following the date of issuance at a price of $2.51 per share.

Georgiy Timoshin, a financial analyst at Freedom Finance Global, points out that such insider activity could be a positive sign for the company’s outlook, since insiders have a unique understanding of the potential of the business and influence its strategic direction. 

“For small-cap names, this can be an extremely important indicator of insiders’ long-term confidence in the stock, especially given the limited availability of information,” he noted.

The private placement, expected to close today, Wednesday, October 30, should raise $2.44 million in net proceeds, prior to offering expenses. MAIA plans to use some of the proceeds to fund manufacturing of its drug, THIO, to be used in phase II (out of three) clinical trials on patients with non-small-cell lung cancer.

About MAIA Biotechnology

MAIA focuses on targeted cancer therapies and immuno-oncology treatments. Currently, there are three main cancer treatment approaches: chemotherapy, hormone therapy, and targeted therapy. The latter attacks only cancer cells and thus, unlike chemotherapy, leaves healthy cells unaffected, while immunotherapy helps to stimulate the immune system to fight cancer.

MAIA’s lead drug candidate, THIO, claimed to be first in class, is designed to target telomeres. Telomeres can be thought of as “protective caps” on the ends of chromosomes. THIO “uncaps” these chromosomes, resulting in rapid tumor cell death. This molecule also produces cancer cell specific immune memory, enabling the immune system to recognize and fight cancer after extended periods of time with no treatment, MAIA notes.

Analyst recommendations

According to MarketWatch, the one analyst covering MAIA recommends buying the stock with a target price of $14 per share, more than five times the last closing price.