- If the warrants are fully exercised for cash, Incannex could receive up to an additional $13 million.
- The company said the funds should support completion of the Phase 2 DReAMzz study for its IHL-42X program.
- Phase 2 RePOSA trial showed that IHL-42X delivered statistically significant improvements, reducing breathing interruptions during sleep, preserved REM sleep, and showed no serious safety concerns.
Shares of Incannex Healthcare Inc (IXHL) fell 35% on Thursday, after the company announced the pricing of its $10 million private placement. The company also shared that the Phase 3 development of its oral drug candidate for obstructive sleep apnea is not expected to begin until the second half of 2027.
The company plans to issue 2 million shares of common stock, or equivalents, along with warrants to purchase up to another 2 million shares at a combined price of $5.00 per share and accompanying warrant. IHXL shares closed at $5.97 in the previous session. Incannex announced that it has ceased using its at-the-market (ATM) facility and has no plans to use it again.
If the warrants are fully exercised for cash, Incannex could receive up to an additional $13 million, bringing total potential proceeds to about $23 million. The company said the funds should support completion of the Phase 2 DReAMzz study for its IHL-42X program, while existing cash will remain available for planned Phase 3 development expected to begin in the second half of 2027.
Incannex’s Plan Ahead
The firm said it has updated the clinical development strategy for its oral drug candidate IHL-42X, to treat obstructive sleep apnea, after positive results from its Phase 2 study. The therapy has also received Fast Track designation from the U.S. Food and Drug Administration.
The company intends to run a Phase 2 crossover study, known as DReAMzz, to optimize the drug’s dosage before advancing to a streamlined Phase 3 program. The study aims to improve dosing precision and build stronger clinical data ahead of late-stage development.
Results from the Phase 2 RePOSA trial showed that IHL-42X delivered statistically significant improvements. The treatment reduced breathing interruptions during sleep, preserved REM sleep, and showed no serious safety concerns.
How Did Stocktwits Users React?
Despite the sharp selloff, retail sentiment for IXHL on Stocktwits turned ‘extremely bullish,’ amid ‘extremely high’ message volumes.
One user said that while the financing itself isn’t too negative, management’s communication regarding the delayed Phase 3 trial has been poor.
Another user said the offering “looks worse than it actually is.”
Year-to-date, the stock has slumped 66%.
For updates and corrections, email newsroom[at]stocktwits[dot]com.