Why Athira Pharma Stock Dropped Today

Shares of Athira Pharma (NASDAQ: ATHA) dropped sharply on Thursday and ended the trading session down by 16.7%. The catalyst for that plunge was the company's announcement on Wednesday evening of the pricing of a new stock offering. Investors were not thrilled with the clinical-stage biopharmaceutical company's decision to dilute existing shareholders.

Athira Pharma will sell 4 million shares of its common stock for $22.50 per share. It had closed Wednesday's trading session at $24.32. By the end of Thursday's session, they were changing hands for $20.27. The healthcare company expects to collect $90 million in gross proceeds from the sale. Athira Pharma is also granting the underwriters a 30-day option to purchase up to an additional 600,000 shares, still for $22.50 per share. The public offering should close on Jan. 25, according to the company.

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Source Fool.com