Jyong Biotech prices $20 million IPO of 2,666,667 shares at $7.50 on Nasdaq

Jyong Biotech Ltd. priced its initial public offering of 2,666,667 ordinary shares at $7.50 per share. The pricing release is dated June 16, 2025. The Cayman Islands holding company expects gross proceeds of about $20 million before underwriting discounts and offering expenses. Its shares were approved for listing on the Nasdaq Global Market under the symbol MENS, with trading expected to begin on June 17, 2025.

The underwriter and the money

Joseph Stone Capital, LLC is the sole underwriter, on a firm commitment basis. The prospectus shows a total public offering price of US$20,000,000, underwriting discounts and commissions of US$1,400,000 and proceeds before expenses of US$18,600,000. It describes the discount as up to seven percent (7.0%) of gross proceeds. The company expects net proceeds of approximately US$17,769 thousand. The underwriter holds a 45-day option on up to 400,000 more shares. According to the pricing release, Sichenzia Ross Ference Carmel LLP is U.S. securities counsel to the company, and VCL Law LLP is U.S. securities counsel to the underwriter. Directors, officers and holders of more than 5% have agreed to a twelve (12) month lock-up, and holders of less than 5% to six (6) months.

The company said 40% of the proceeds go to additional Phase III trials of MCS-2 (API-2) and its new drug application, 25% to earlier phase trials if it cannot show comparability, 10% to a Phase II trial of PCP, 5% to a Phase I trial of IC, and 20% to general corporate purposes.

A pivotal trial that missed its main endpoint

The lead candidate, MCS-2, is a softgel botanical drug for benign prostate hyperplasia and lower urinary tract symptoms. The prospectus says the pivotal U.S. Phase III trial failed to show a difference between treatment groups on the primary efficacy endpoint in the intent-to-treat population.

Jyong resubmitted an NDA on December 17, 2021, using the first active ingredient, API-1. The FDA accepted it on February 22, 2022 "with issues identified," citing the lack of a demonstrated difference from placebo and problems in other areas. The company withdrew the NDA on November 30, 2022 to develop more information about API-2. It says it will start a new MCS-2 Phase III study with API-2 only if it can show the two ingredients are comparable to the FDA's satisfaction. If it cannot, it must repeat the MCS-2 and PCP trials with API-2, or run other trials the FDA requires.

Going-concern doubt, debts and a court judgment

The prospectus says there is substantial doubt about the company's ability to continue as a going concern. It has not generated revenue. Its net working capital deficit was approximately US$12.4 million at December 31, 2023 and US$11.9 million at December 31, 2024. Bank loans of about US$8.0 million and US$7.3 million at those dates are due within the next twelve months.

The larger exposure is a dispute with a shareholder, the Taizhou City Optimization and Upgrade Investment Partnership. It bought 1,794,258 Jyong shares in May 2019 for RMB112,500,000 and sued for redemption. On March 25, 2024 the Taizhou court ruled partly for the plaintiff, and the High People's Court of Zhejiang Province later upheld it. The prospectus says the judgment is final and not appealable. It makes Jyong, its Taiwan subsidiary and chief executive Fu Feng Kuo jointly liable. Total potential liability was USD 19,378,364 at December 31, 2024, about RMB 134.5 million. The plaintiff may also liquidate the pledged equity in the PRC subsidiary. No enforcement has begun and the company is negotiating a settlement, but it gives no assurance of one. Its own counsel said an unfavorable outcome is likely without a settlement.

Other current liabilities of US$5.0 million and US$3.3 million reflect litigation with the Taizhou Bay New District Administrative Committee and commitments to the Taizhou Resources Bureau. The company says that under a September 26, 2024 notice it will return the land use right, and $2.9 million of the land idling fee will be waived.

Structure

Investors are buying shares of the Cayman holding company, not of its operating subsidiaries in Taiwan, Singapore, Hong Kong and the PRC.

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