Incannex Cancels 347M Warrants to Reduce Dilution Ahead of Trial Data

Incannex Healthcare Inc. has entered into a definitive agreement to cancel its remaining 172 million Series A Warrants, which, combined with an earlier cancellation of 175.2 million warrants, will eliminate up to 347.2 million potential dilutive shares. This strategic move, involving a cancellation payment of up to $12.2 million, aims to strengthen the company's capital structure and reduce the risk of shareholder dilution ahead of the anticipated topline results from its Phase 2 RePOSA trial of IHL-42X, an oral treatment for obstructive sleep apnea, expected by July 2025. IHL-42X is being developed as a potential first-in-class pharmaceutical therapy for obstructive sleep apnea, a condition currently lacking FDA-approved drug treatments and affecting millions worldwide. CEO Joel Latham emphasized that this transaction provides clarity and confidence to shareholders by removing a significant overhang of shares from the market. Despite recent stock volatility and rapid cash burn, Incannex’s financial position remains sound with more cash than debt and a healthy current ratio. The warrant cancellations position the company favorably for advancing clinical trials and potential growth, aligning with its forward strategy and investor interests.