New York, May 20, 2026, 05:08 EDT
Co-Diagnostics shares slipped in premarket trading on Wednesday. The company said late Tuesday it had raised $3 million in a private placement, shortly after the stock surged 43.8% to finish at $1.97. The shares were down 13.3% to $1.71 in extended trading ahead of the regular Nasdaq open.
Co-Diagnostics shares jumped after the company said it finished work on a strategy for an assay on the Bundibugyo virus causing the Ebola outbreak in Democratic Republic of Congo and Uganda. But the rally faded as a late financing raised worries about dilution and cash requirements.
Co-Diagnostics said it plans to sell 1.65 million shares or pre-funded warrants instead of shares, along with warrants for up to 3.29 million more shares. Each unit, which includes a share and a warrant, is priced at $1.821. The warrants have a $1.571 exercise price and run for five years. The private placement should close around May 21, pending usual conditions. Maxim Group will act as sole placement agent.
Co-Diagnostics had 3.60 million common shares out as of May 12, according to a filing. That means the new shares or pre-funded warrants in this deal are about 46% of the outstanding stock before including the extra warrants. For a microcap, that’s a big slice.
New financing comes as liquidity stays tight. Co-Diagnostics said in its latest quarterly filing it had $8.2 million in cash and cash equivalents at the end of March, falling from $11.9 million at the end of last year. Management said there was “substantial doubt” about the company’s ability to keep going as a business, an accounting signal that more funding or better results are needed to stay afloat.
Co-Diagnostics on Tuesday said its assay development strategy for Bundibugyo virus, or BDBV, is now done. CEO Dwight Egan said the company could “rapidly make the test available” if needed. Co-Diagnostics also told investors the Co-Dx PCR platform still needs regulatory review and is not approved for sale. PR Newswire
WHO’s May 17 announcement about Ebola in Congo and Uganda comes with more urgency after the outbreak. The World Health Organization called it a public health emergency of international concern, but stopped short of labeling it a pandemic emergency. WHO warned the outbreak may be bigger than what is known now, with risk of wider spread in the region.
U.S. health officials have stepped up their response, tightening entry restrictions and travel screening, according to the CDC. On May 19, the CDC said it and DHS put new public-health measures in place while warning that case numbers could shift. As of May 19, the DRC and Uganda health ministries reported 536 suspected cases, 34 confirmed cases and 134 deaths.
Competition is present. Reuters said BioFire Defense, linked to France’s bioMérieux, has an FDA-cleared test for several Ebola strains such as Bundibugyo, and is boosting production. Anne Ancia from WHO Congo told Reuters there’s “great uncertainty” about the outbreak’s scale, since only six tests for the strain can be run each hour. Reuters
Biotech stocks fell before the open, with SPDR S&P Biotech ETF slipping 0.7%. For Co-Diagnostics, moves on news can be sharp but don’t always last. What sticks is how funding plays out, hitting regulatory steps, and if public-health interest brings in real orders.
But there’s a clear risk here. The Ebola news is just a strategy update, not an approved product or a signed deal, and new securities could dilute current holders if the company issues and exercises them. If the outbreak response relies on already cleared tests or if Co-Diagnostics fails to get regulatory clearance and sales, the bounce on Tuesday could fade fast.
