By Colin Kellaher

Ovid Therapeutics shares surged in premarket trading Friday after the biopharmaceutical company reported positive results from an early study of a proposed epilepsy drug and inked a financing deal that could bring in up to about $175 million in gross proceeds.

Ovid on Friday said a Phase 1 study evaluating the safety, tolerability, and pharmacokinetic and pharmacodynamic activity of its OV329 drug candidate in development for drug-resistant epilepsies showed strong inhibitory activity and a favorable safety and tolerability profile in healthy volunteers.

The New York company said it plans to advance OV329 into a Phase 2a study in drug-resistant focal onset seizures.

Ovid also said it agreed to a private investment in public equity, or PIPE, financing with an group of investors that will result in initial gross proceeds of roughly $81 million.

The financing includes the sale of Series B non-voting convertible preferred stock convertible into more than 57.7 million shares, along with two series of warrants to buy common stock at $1.40 a share, subject to certain conditions, the company said.

Ovid said it would receive additional gross proceeds of $94.3 million if all of the warrants are exercised for cash, adding that the conversion of all of the Series B preferred and the exercise of all of the warrants would result in the company issuing nearly 125.1 million shares in connection with the PIPE financing.

The company said the financing extends its runway into 2028.

Ovid, which had about 71.1 million shares outstanding as of Aug. 1, sports a market capitalization of $116.6 million based on Thursday's closing price of $1.64.

Shares of Ovid were recently up 20% to $1.97 in premarket trading Friday.

Write to Colin Kellaher at colin.kellaher@wsj.com

(END) Dow Jones Newswires

October 03, 2025 07:38 ET (11:38 GMT)

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