Cerus Corporation (NASDAQ:CERS) shares closed at $6.14 on Tuesday after the company gained financial support of up to $180 million from the U.S. Biomedical Advanced Research and Development Authority. With this agreement, the company can continue to develop its Intercept Blood System, using the funds to support continued clinical development of its blood system. In addition, the funding can also be used for commercial activities in promoting the adoption of its system in blood centers across the country.
Cerus Corporation has a market cap of $603.33 million at 101.71 million shares outstanding. The company’s stock has traded in a 52-week range of $4.27 to $6.89, which means that price is at the resistance.
The U.S. Biomedical Advanced Research and Development Authority will provide $30 million for its initial round of funding, aimed at advancing the company’s clinical studies being conducted in Puerto Rico. It will also be used to support late-stage clinical trials in the U.S. In addition, Cerus Corporation and its partners have committed to invest $14.5 million to scale up its manufacturing capabilities.
This deal was signed by the agency because it believes that the Intercept Blood System can reduce the risk of transfusion-transmitted diseases, particularly with the outbreak of Zika these days. The funding agreement is set to last for five years with the first few sets of funds likely to offset the company’s losses.
Cerus Corporation is biomedical products company that operates through the blood safety segment with its Intercept Blood System. The company has been actively looking for funding deals to support its operations and recover from recent financial losses. It reported a net loss of more than $55 million in the latest reporting quarter and is projecting revenues of less than $40 million for this year, as it plans to spend aggressively on marketing its blood system.
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