Avenue Therapeutics (ATXI) Announces $3.25 Million Registered Direct and Private Placement of Common Stock, Warrants

Avenue Therapeutics, Inc. (Nasdaq: ATXI) (“Avenue” or the “Company”), a specialty pharmaceutical company focused on the development and commercialization of therapies for the treatment of central nervous system diseases, today announced that it has entered into a definitive agreement with a single institutional investor for the purchase and sale of 1,940,299 shares of common stock and pre-funded warrants to acquire common stock in a registered direct offering. In a concurrent private placement, the company also agreed to issue to the same investor a total of 1,940,299 warrants to purchase up to one share of common stock each at an exercise price of $1.55 per share. The private placement warrants will be exercisable immediately subject to registration and will have a 3-year term from the initial exercise date. Aggregate gross proceeds to the Company of both transactions are expected to be approximately $3.25 million. The transactions are expected to close on or about January 31, 2023, subject to the satisfaction of customary closing conditions.

The purchase price of each share is $1.55. The purchase price of each pre-funded warrant is $1.5499 with an exercise price of $0.0001. The purchase price of each warrant is $0.125 with an exercise price of $1.55. The entire transaction has been priced at the market under Nasdaq rules.

Avenue expects to use the net proceeds from the offering, together with its existing cash, for general corporate purposes and working capital.

Aegis Capital Corp. is acting as Exclusive Placement Agent for the offering.

The registered direct offering is being made pursuant to an effective shelf registration statement on Form S-3 (No. 333-261520) previously filed with the U.S. Securities and Exchange Commission (SEC) and declared effective by the SEC on December 10, 2021. A final prospectus supplement and accompanying prospectus describing the terms of the proposed offering will be filed with the SEC and will be available on the SEC’s website located at www.sec.gov. Electronic copies of the final prospectus supplement and the accompanying prospectus may be obtained, when available, by contacting Aegis Capital Corp., Attention: Syndicate Department, 1345 Avenue of the Americas, 27th floor, New York, NY 10105, by email at [email protected], or by telephone at (212) 813-1010.

The offer and sale of the securities in the private placement are being made in a transaction not involving a public offering and have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or applicable state securities laws. Accordingly, the securities may not be reoffered or resold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act and such applicable state securities laws. The securities were offered only to accredited investors. Pursuant to a registration rights agreement with the investor, the Company has agreed to file one or more registration statements with the SEC covering the resale of the common stock and the shares issuable upon exercise of the pre-funded warrants and warrants.

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