Mind Medicine Inc ( MNMD ) shares are trading higher Thursday after the company received FDA breakthrough therapy designation and announced positive study data.

What Happened: MindMed announced that the FDA has granted breakthrough designation to its MM120 (lysergide d-tartrate) program for the treatment of generalized anxiety disorder. 

The company also announced that its Phase 2b study of MM120 in generalized anxiety disorder met its key secondary endpoint. 12-week topline data demonstrated “clinically and statistically significant durability of activity” observed through week 12, MindMed said.

“The FDA’s decision to designate MM120 as a breakthrough therapy for GAD and the durability data from our Phase 2b study provide further validation of the important potential role this treatment can play in addressing the huge unmet need among individuals living with GAD,” said Robert Barrow, CEO and director of MindMed.

“We are committed to bringing MM120 to people living with GAD and delivering on the potential of our pipeline to treat serious brain health disorders.”

The primary data analyses from the Phase 2b study have been accepted for presentation at the American Psychiatric Association’s annual meeting, which will be held in New York, beginning May 4. MindMed noted that it will submit the study for publication in a leading medical journal.

MindMed also announced the pricing of an underwritten offering and concurrent private placement Thursday morning. The company will offer 16.66 million shares at a price of $6 per share. In addition, MindMed has entered into share purchase agreements for a concurrent private placement of 12.5 million shares at the offering price.

The offering and concurrent private placement are expected to close on or about March 11. All of the shares are being sold by MindMed. The company anticipates gross proceeds of approximately $175 million.

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MNMD Price Action: MindMed shares were touched the $8.40 level Thursday morning before pulling back. The stock was up 22.9% at $7.27 at the time of publication, according to Benzinga Pro.