Friday's private investment in public equity transaction valued at $55.6 million by Vor Biopharma Inc. (VOR, Financials) sent its stock price skyrocketing 46.78% to finish at $1.23. The funding is supposed to cover the expansion of its pipeline treatments for blood malignancies as well as stretch the company's financial runway till 2025.

• Warning! GuruFocus has detected 2 Warning Signs with VOR.

Under the deal, Vor Bio will issue 55.9 million common stock shares and corresponding warrants to buy an additional 69.8 million shares at a combined price of $0.99425 per share and warrant. The warrants, exercisable at $0.838 per share, might be used until 2031, hence perhaps adding $58.5 million in profits if completely used.

New investor Reid Hoffman spearheaded the fundraising with major shareholder RA Capital Management, Vor Bio. As agreed upon, each will get board representation. Hoffman called the company's trem-cel therapywhich targets acute myeloid leukemia using CRISpen/Cas9 technologya hopeful development in cancer treatment.

With updated data expected in the first half of 2025, proceeds from the PIPE will support Vor Bio's continuous clinical trials, including the Phase 1/2 VBP301 trial of VCAR33ALLO and the Phase 1/2a VBP101 trial of trem-cel in combination with Mylotarg. Preclinical research and industry needs will also get more funding.