Why Did KTTA Stock Soar A Whopping 43% Today?

• The company expects gross proceeds of about $60 million from the offering, which it intends to use for general corporate purposes.
• Pasithea expects the offering to close on or about December 1.

Pasithea Therapeutics Corp. (KTTA) on Friday announced the pricing of a public offering of 80 million shares of the company’s common stock at $0.75 per share.

KTTA shares traded 43% higher on Friday morning at the time of writing.

Offering Proceeds And Purpose

The company expects gross proceeds of about $60 million from the offering, which it intends to use for general corporate purposes such as ongoing research and pre-clinical studies, clinical trials, the development of new biological and pharmaceutical technologies, and investing in or acquiring companies that are synergistic with or complementary to the company’s technologies, among others.

The offer price represents a 29% discount to the stock’s Wednesday closing price.

The company said that it expects the offering, led by investors including Vivo Capital, Janus Henderson Investors, Coastlands Capital, Columbia Threadneedle Investments, Adage Capital Partners, and Squadron Capital Management, to close on or about December 1. The offering will extend its cash runway through at least the first half of 2028, it added.  

Earlier this month, the company was awarded a Hoffman ALS Clinical Trial Award grant worth about $1 million to study its lead drug candidate, PAS-004, in Amyotrophic lateral sclerosis (ALS) patients. ALS is a progressive neurodegenerative disease that affects nerve cells in the brain and spinal cord, where patients eventually lose the ability to breathe.

How Did Stocktwits Users React?

On Stocktwits, retail sentiment around KTTA stock stayed within the ‘extremely bullish’ territory over the past 24 hours, while message volume stayed at ‘extremely high’ levels.

A Stocktwits user opined that the stock will erode its gains to hit $0.75 level.

KTTA stock is down by 52% this year. 

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