NervGen Pharma's $10M Non-Brokered Private Placement and Its Implications for Growth

NervGen Pharma Corp. (TSXV: NGEN) has recently executed a $10 million non-brokered private placement, a strategic move designed to accelerate the development of its lead therapeutic, NVG-291, and support its anticipated Nasdaq listing. This capital-raising initiative, which includes participation from institutional and accredited investors such as SCI Ventures and the Paul and Phyllis Fireman Charitable Foundation, underscores the company's commitment to advancing its clinical pipeline while positioning itself for broader market access in the United States.

Capital Structure and Dilution Dynamics

The private placement involves the issuance of up to 4,785,715 units at $2.10 per unit, with each unit comprising one common share and one-half of a warrant. While this financing will inevitably result in share dilution, the transaction aligns with NervGen's need to strengthen its balance sheet. As of Q3 2025, the company's capital structure is characterized by a total debt to total equity ratio of 4.10, indicating a reliance on equity financing to fund operations and R&D. The new capital infusion is expected to mitigate liquidity constraints, particularly as the company approaches key clinical and regulatory milestones in 2025.

Accelerating Clinical Development

NVG-291, a first-in-class therapeutic peptide, is currently in the Phase 1b/2a CONNECT SCI Study, with enrollment in the subacute cohort ongoing. The drug has already secured Fast Track designation from the FDA and Orphan Designation from the EMA for spinal cord injury, highlighting its potential to address a significant unmet medical need. The $10 million raised will directly support the advancement of this program, including the expansion of clinical trials and preparation for regulatory submissions. By aligning capital allocation with these critical activities, NervGen aims to de-risk its pipeline and enhance the probability of successful commercialization.

Nasdaq Listing as a Strategic Lever

A key component of the financing strategy is the company's anticipated Nasdaq listing, which is expected to broaden access to U.S. investors and provide a platform for scaling operations. The transition to a U.S.-listed exchange typically increases visibility and liquidity, factors that are crucial for biopharmaceutical firms navigating lengthy development timelines. SCI Ventures, a venture fund focused on paralysis, has emphasized its alignment with NervGen's mission to develop the first approved regenerative drug for chronic spinal cord injury, further validating the company's long-term vision.

Shareholder Value Creation

While dilution is an inherent trade-off in private placements, the strategic use of proceeds can outweigh short-term share price pressures. NervGen's allocation of funds to clinical development and a Nasdaq listing reflects a disciplined approach to value creation. By advancing NVG-291 through pivotal trials and securing regulatory milestones, the company aims to generate data that could attract partnerships or accelerate commercialization. Additionally, the Nasdaq listing is likely to enhance investor confidence, particularly as the U.S. market represents a significant portion of global biotech capital.

Conclusion

NervGen Pharma's $10 million non-brokered private placement is a calculated step toward achieving both operational and strategic objectives. The financing addresses immediate capital needs while positioning the company to capitalize on its clinical progress and regulatory designations. For investors, the transaction highlights NervGen's ability to secure institutional backing and execute a capital-raising strategy that balances dilution with growth potential. As the company moves closer to key milestones in 2025, the successful execution of its Nasdaq listing and NVG-291's clinical trajectory will be critical indicators of long-term value creation.