ValiRx shares tank on £1.6m fundraising plan to support R&D

(Sharecast News) - Shares in life sciences firm ValiRx plummeted on Monday after the AIM-listed firm announced plans to raise £1.57m to increase its R&D efforts as it continues the development of breast cancer treatment CytoLytix. The stock was down 43% at 0.85p by 0955 GMT, having tumbled 86% over 2024 to date.

The conditional fundraising, which includes a £1.18m share placement, a broker offer to raise £250,000 and a subscription by directors to raise £140,000, is subject to shareholder approval at a general meeting on 30 December.

ValiRx said the funds would be used for preclinical testing for CytoLytix, as well as additional testing and evaluation projects and operating costs.

However, ValiRx warned that, if the fundraising plan isn't approved, "in light of the group's reducing cash position, it would be likely that the company would have to severely restrict its costs, potentially impacting its ability to progress its R&D assets and generate value for the group".

Commenting on the announcement, chief executive Mark Eccleston said: "I want to thank new and existing shareholders for their support and highlight we will be using the money to further support the preclinical development of CytoLytix."