Ayala Pharmaceuticals Inc. (AYLA) Announces $25 Million Strategic Financing Via Common Stock, Warrants

Ayala Pharmaceuticals, Inc. (NASDAQ: AYLA), a clinical-stage oncology company focused on developing and commercializing small molecule therapeutics for patients suffering from rare and aggressive cancers, today announced that it has entered into a definitive agreement for the sale of its equity securities in a private placement to institutional investors, including Redmile Group and SIO Capital Management.

"We are very excited to have obtained additional funding enabling us to execute on our strategic priorities and support business growth from high quality US healthcare dedicated funds, which we also expect will extend our cash runway into 2023,” said Roni Mamluk, Ph.D., Chief Executive Officer of Ayala. “Ayala is well capitalized as we approach several key milestones planned for the remainder of 2021. We look forward to initiating our pivotal Phase 2/3 study of AL102 for the treatment of desmoid tumors in the first half of this year and presenting data from our Phase 2 study of AL101 for the treatment of recurrent/metastatic adenoid cystic carcinoma and triple negative breast cancer later this year.”

The agreement provides for the sale of an aggregate of 1,666,666 units at a price of $15 per unit. Each unit consists of one share of Ayala’s common stock and a warrant to purchase 0.35 of a share of common stock at an exercise price of $18.10 (the “Warrant”). One institutional investor has elected to receive pre-funded warrants to purchase common stock in lieu of its common stock. The Warrants are exercisable at any time during the period beginning on the closing date of the private placement and ending on the third anniversary of the closing. The gross proceeds from the sales of common stock are expected to be approximately $25 million, before deducting placement agent fees and offering expenses. The private placement is expected to close on or about February 23, 2021, subject to the satisfaction of customary closing conditions.

Jefferies LLC is acting as the exclusive placement agent for the private placement.

Based on Ayala’s current plans, it believes that its existing cash and cash equivalents and short-term restricted bank deposits, with the expected net proceeds from the private placement, will be sufficient to fund its operating expenses and capital expenditure requirements through multiple expected catalysts into 2023.

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