Milestone Pharmaceuticals Inc. ( MIST ) moved closer to potential FDA approval for its Cardamyst (etripamil) nasal spray, an investigational therapy for paroxysmal supraventricular tachycardia (PSVT), as the U.S. Food and Drug Administration (FDA) accepted the company’s response to prior issues.

However, shares of Milestone Pharmaceuticals ( MIST ) plummeted over 36% on Friday following the pricing of a public offering that includes common shares and accompanying warrants, signaling potential dilution for existing shareholders.

The U.S. Food and Drug Administration (FDA) on Friday accepted for review Milestone Pharmaceuticals’ response to issues raised in the Complete Response Letter (CRL) for Cardamyst (etripamil) nasal spray, an investigational therapy for paroxysmal supraventricular tachycardia (PSVT).

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PSVT is a type of rapid heartbeat that originates in the heart’s upper chambers. The FDA has assigned a new Prescription Drug User Fee Act (PDUFA) target action date of December 13, 2025.

In June, Milestone Pharmaceuticals ( MIST ) submitted its response to the FDA’s CRL regarding its New Drug Application (NDA) for Cardamyst (etripamil) nasal spray.

The CRL was issued in March. The FDA did not raise concerns about the clinical safety or efficacy of etripamil, it highlighted two critical issues related to Chemistry, Manufacturing, and Controls.

The FDA requested additional information on nitrosamine impurities based on newly issued draft guidance, which was released after the NDA submission.

With the FDA acceptance, Milestone also announced the extension of its $75.0 million purchase and sale agreement with existing shareholder, RTW Investments, LP, and certain of its affiliates (RTW) until December 31, 2025.

The proceeds from the Royalty Purchase Agreement are expected to aid a successful planned launch of Cardamyst in PSVT following expected FDA approval.

“The FDA’s acceptance for review of our response to the CRL is a key milestone for Cardamyst, and we look forward to working with the Agency toward a potential approval decision later this year,” said Joe Oliveto, President and CEO of Milestone Pharmaceuticals.”…The anticipated funds will position us well to execute on the commercial launch as we work to get Cardamyst into the hands of patients with PSVT in need of a new treatment.”

The company also priced its previously announced underwritten public offering of 31.5 million shares, accompanying Series A common warrants to purchase 31.5 million shares, and Series B common to purchase 31.5 million shares at a combined public offering price of $1.50 per share and accompanying warrants.

The company is also offering pre-funded warrants to purchase 3,502,335 shares, accompanying Series A warrants to purchase 3.5 million shares, and accompanying Series B warrants to purchase 3.5 million shares at $1.499 per pre-funded warrant and accompanying warrants.

The gross proceeds are expected to be approximately $52.5 million.

Price Action: MIST stock is trading lower by 36.3% to $1.63 at last check Friday.

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