Dimerix (DXB: $0.072) is seeking to raise $12 million at $0.08 per share. Confirming the difficult capital markets, the raise will include a rights issue and also convertible note financing.

Through the rights issue, which is partially underwritten, the company is seeking to raise $8.6 million, with $4.1 million underwritten. The raise is being coordinated by Bell Potter Securities.

The convertible note funding is being provided by Mercer Street Global Opportunity Fund. It will provide between $3.5 - $12 million in funding. The convertible notes can only be converted at $0.11 for the first three months after issue, then at a the lesser of $0.11 per share or 90% of the preceding two day average share price (VWAP).

Dimerix is conducting a Phase III study with its lead drug candidate, DMX200, for the treatment of the orphan kidney disorder, FSGS. Completion of recruitment of the first cohort of 72 patients was achieved in mid December last year. With 10 weeks of screening and stabilisation, and 35 weeks of treatment, results are due at the end of this year from the interim analysis, which will be a major inflection point for the company. The trial is being conducted across 70 sites in 11 countries.

The company is in advanced partnering discussions with "material offers received from multiple parties for various territories." The decision for the company is whether to enter into licensing deals before or after the interim results, with a better outcome obviously following positive data.

Dimerix finished March with $4 million in cash. The company is capitalised at $23 million, excluding the current capital raise underway.

Bioshares recommendation: Speculative Buy Class B

CEO Nina Webster will be presenting at this year's Bioshares Biotech Summit in Hobart in July.