ArQule Announces Pricing of $60.5 Million Public Offering of Common Stock

ArQule, Inc. (Nasdaq: ARQL) today announced the pricing of an
underwritten public offering of 11 million shares of its common stock at
a price to the public of $5.50 per share. ArQule has granted the
underwriters a 30-day option to purchase up to an additional 1.65
million shares of its common stock. The offering is expected to close on
or about July 13, 2018, subject to satisfaction of customary closing
conditions. The gross proceeds to ArQule from the offering, excluding
any exercise by the underwriters of their 30-day option to purchase
additional shares, are expected to be $60.5 million, before deducting
underwriting discounts and commissions and other offering expenses
payable by ArQule.

The Company intends to use the net proceeds of the offering to fund its
core clinical programs and for general corporate purposes.

Leerink Partners is acting as sole book-running manager for the
offering. Needham & Company, LLC is acting as lead co-manager, and Roth
Capital Partners, B. Riley FBR and JonesTrading Institutional Services
LLC are acting as co-managers for the offering.

The securities described above are being offered by ArQule pursuant to
an effective shelf registration statement on Form S-3 (File. No.
333-213456), including a base prospectus, that was previously filed by
ArQule with the Securities and Exchange Commission (“SEC”). A final
prospectus supplement and accompanying prospectus relating to the
offering will be filed with the SEC and will be available on the SEC’s
website located at www.sec.gov
or on ArQule’s website, www.arqule.com.
Copies of the final prospectus supplement and the accompanying
prospectus relating to the offering, when available, may be obtained
from Leerink Partners LLC, Attention: Syndicate Department, One Federal
Street, 37th Floor, Boston, MA 02110, by telephone at (800)
808-7525, ext. 6132 or by email at syndicate@leerink.com.

This press release does not constitute an offer to sell or a
solicitation of an offer to buy, nor will there be any sales of these
securities in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities laws of such jurisdiction.

About ArQule

ArQule is a biopharmaceutical company engaged in the research and
development of targeted therapeutics to treat cancers and rare diseases.
ArQule’s mission is to discover, develop and commercialize novel small
molecule drugs in areas of high unmet need that will dramatically extend
and improve the lives of our patients. Our clinical-stage pipeline
consists of five drug candidates, all of which are in targeted,
biomarker-defined patient populations, making ArQule a leader among
companies our size in precision medicine. ArQule’s pipeline includes:
ARQ 531, an orally bioavailable, potent and reversible inhibitor of both
wild type and C481S-mutant BTK, in a Phase 1 trial for patients with
B-cell malignancies refractory to other therapeutic options; Miransertib
(ARQ 092), a selective inhibitor of the AKT serine/threonine kinase, in
a phase 1/2 company-sponsored trial for Overgrowth Diseases, in a Phase
1 trial for ultra-rare Proteus syndrome conducted by the National
Institutes of Health (NIH), and in a Phase 1b trial in combination with
the hormonal therapy, anastrozole, in patients with advanced endometrial
cancer; ARQ 751 a next generation AKT inhibitor, in a Phase 1 trial for
patients with AKT1 and PI3K mutations; Derazantinib, a multi-kinase
inhibitor designed to preferentially inhibit the fibroblast growth
factor receptor (FGFR) family, in a registrational trial for iCCA; and
ARQ 761, a ?-lapachone analog being evaluated as a promoter of
NQO1-mediated programmed cancer cell necrosis, in a Phase 1/2 trial in
multiple oncology indications in partnership with the University of
Texas Southwestern Medical Center. ArQule’s current discovery efforts
are focused on the identification and development of novel kinase
inhibitors, leveraging the Company’s proprietary library of compounds.

Forward Looking Statements

This press release contains forward-looking statements including,
without limitation, statements about ArQule’s expectations regarding the
completion, timing and size of the proposed offering, and its
expectations with respect to granting the underwriters a 30-day option
to purchase additional shares. These statements are based on
ArQule’s current beliefs and expectations, and involve assumptions that
may never materialize or may prove to be incorrect. Actual
results and the timing of events could differ materially from those
anticipated in such forward-looking statements as a result of various
risks and uncertainties, which include, without limitation, risks
associated with market conditions and the satisfaction of closing
conditions related to the proposed public offering, as well as risks and
uncertainties associated with ArQule’s drug development and other
activities. For more detailed information about these risks and
uncertainties, see ArQule’s periodic reports filed with the SEC. ArQule
does not undertake any obligation to publicly update any forward-looking
statements.

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