Sernova Biotherapeutics secured a CAD$1,000,000 convertible debenture financing from existing shareholder and board member, Dr. Steven Sangha. The proceeds will bolster the company’s working capital. The debenture, repayable by March 4, 2027, has a 15% interest rate and includes warrants exercisable into common shares at CAD$0.20 per share.
This financing is crucial for Sernova as it allows the company to continue operations and advance its research and development efforts without immediately diluting shareholder value. Securing funding from an insider like Dr. Sangha demonstrates confidence in Sernova’s long-term prospects and technology, potentially signaling positive developments to other investors. Strengthening the company’s financial position allows Sernova to focus on achieving key milestones in its clinical trials and further development of its Cell Pouch Bio-hybrid Organ for type 1 diabetes.
The financing involved a CAD$1,000,000 unsecured convertible debenture with a 15% interest rate and 5,000,000 warrants exercisable at CAD$0.20 per share until March 4, 2028. The conversion price for the debenture is also CAD$0.20 per share. This structure provides Dr. Sangha with the potential for future equity ownership while offering Sernova a less dilutive financing option in the short term. The transaction qualifies as a related-party transaction under MI 61-101 but utilizes exemptions from formal valuation and minority shareholder approval requirements due to its size relative to Sernova’s market capitalization.
This injection of capital strengthens Sernova’s financial position and provides runway to pursue its clinical development goals. The insider investment could generate positive momentum and attract further investment, ultimately accelerating the development and potential commercialization of its Cell Pouch technology. This progress toward a “functional cure” for type 1 diabetes holds significant promise for patients and the broader healthcare landscape.
Jon Napitupulu is Director of Media Relations at The Clinical Trial Vanguard. Jon, a computer data scientist, focuses on the latest clinical trial industry news and trends.
