DarioHealth Corp. Secures $25.6 Million Private Placement to Support Strategic Operational Objectives

On January 21, 2025, DarioHealth Corp. (NASDAQ: DRIO) made a significant move by closing a $25.6 million private placement of convertible preferred stock. This financial transaction was diligently executed in alignment with Nasdaq market rules, with a substantial portion of the funds sourced from existing shareholders. The remainder was contributed by a collective of distinguished accredited healthcare investors, as well as executives from the healthcare sector.

The successful private placement is a pivotal step toward extending DarioHealth’s financial runway and reinforcing its economic stance. With these newly acquired funds, the company is now well-positioned to continue implementing its strategic plan, which notably includes achieving an operational cash flow positive run rate by the conclusion of 2025. This financial infusion significantly bolsters the Company’s proforma cash balance, which stood at $40.6 million by the conclusion of the third quarter of 2024.

Erez Raphael, the Chief Executive Officer of Dario, expressed his contentment with this milestone achievement, stating, “Today, we are happy to announce the completion of a major milestone in this strategic plan that we believe can secure our projected operational cash flow positive run rate by the end of 2025.”

Moreover, Steven Nelson, the Chief Commercial Officer, also emphasized that this financial backing empowers Dario to push forward with its long-term growth strategy, focusing on high-margin, scalable recurring revenues across its B2B and pharma channels, thus strengthening the company’s footing in the digital health sector.

The transaction details revealed that the company issued newly designated convertible preferred stock, with two categories based on conversion prices. The Preferred Stock terms include entitlement to a 10% dividend payable in common stock each quarter for the first four quarters, up to a total stock dividend of 40%. Moreover, upon the 12-month anniversary of the respective closings, each share of Preferred Stock will automatically convert into shares of the Company’s common stock at the applicable conversion price, subject to stockholder approval.

Furthermore, as part of the offering, lock-up agreements were executed between the Company and certain purchasers, including holders of the Company’s Series B Preferred Stock and Series C Preferred Stock. These agreements are structured to restrict the transfer or sale of Common Stock shares underlying the Series B Preferred Stock and Series C Preferred Stock, providing additional stability and commitment to the Company’s strategic vision.

It’s worth noting that the securities issued in this private placement have not been registered under the Securities Act of 1933 and are subject to specific regulatory restrictions within the United States.

DarioHealth Corp. (NASDAQ: DRIO) is well-recognized as an influential digital health company, leading the way in transforming how individuals manage chronic health conditions using a personalized digital therapeutics platform. The Company’s user-centric approach offers continuous and tailored care for various health conditions, fostering sustainable behavior change and delivering impactful results.

As the company moves forward with its strategic financial moves, it remains committed to disrupting traditional healthcare paradigms and further solidifying its presence in the digital health market.

The forward-looking statements contained in this news release are subject to certain cautionary notes and involve inherent risks and uncertainties, as outlined by DarioHealth Corp. in accordance with regulatory guidelines. These risks and uncertainties underscore the dynamic nature of the healthcare industry and serve as a reminder of the importance of staying aligned with evolving market dynamics and regulatory frameworks.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read DarioHealth’s 8K filing here.

About DarioHealth

DarioHealth Corp. operates as a digital health company in the United States, Canada, the European Union, Australia, and New Zealand. Its digital therapeutics platform and suite of solutions deliver personalized and dynamic interventions driven by data analytics and one-on-one coaching for diabetes, hypertension, weight management, musculoskeletal pain, and behavioral health.