Strongbridge Biopharma plc Secures $53 Million Financing From CRG
July 17 2017 - 7:30AM
~ Financing Comprised of $50 Million
Credit Facility and $3 Million Equity Investment
~~ Simultaneously Retiring Existing Debt
~~ Funds Received at Close Provide Sufficient Cash
Under Current Operating Plan to Extend Cash Runway to Positive Cash
Flow ~
Strongbridge Biopharma plc, (Nasdaq:SBBP), a global
commercial-stage biopharmaceutical company focused on the
development and commercialization of therapies for rare diseases
with significant unmet needs, today announced that it has entered
into a $50 million senior credit facility with CRG LP (“CRG”), a
healthcare-focused investment firm, to retire its existing debt
facility and provide additional capital for the Company.
Strongbridge initially borrowed $40 million under the term loan
agreement and has the option to borrow an additional $10 million
based upon the achievement of certain revenue milestones on or
prior to June 30, 2018. Concurrent with this first tranche, CRG
purchased $3 million of the Company’s ordinary shares at a price of
$6.98 per share.
“We are pleased to have both the support and
confidence of CRG, a premier partner known for its strategic
investments to support the growth of healthcare companies,” said
Matthew Pauls, chief executive officer of Strongbridge. “We
executed this financing to transform the financial outlook of the
Company by fully funding our operating plan until we attain
positive cash flow. The funds received at closing provide
sufficient resources for us to build upon the early uptake and
demand that we are seeing for KEVEYIS® (dichlorphenamide), and to
fund RECORLEV™ (levoketoconazole) through potential regulatory
approval and launch,” Pauls added.
“Strongbridge is in a unique position to address
major areas of unmet need in rare disease," said Luke Düster,
managing director at CRG. “CRG looks forward to working with
Strongbridge as they continue to build their global business and
advance their product pipeline. Our due diligence has confirmed our
belief that Strongbridge's portfolio has great potential and that
access to funds from this financing will help build value for the
Company.”
The term loan agreement has a six-year term with
three years of interest-only payments. The interest-only period may
be extended to six years based upon the achievement of certain
milestones during the first three years of the loan term. As a
condition to the new credit facility, the Company issued warrants
with a seven-year term to CRG to purchase 394,289 of the Company’s
ordinary shares at an exercise price of $7.37 per share. After the
retirement of existing debt and payment of expenses associated with
the financing, Strongbridge intends to use the remainder of the
upfront proceeds from the credit facility and equity investment for
general corporate purposes and working capital.
Additional details regarding this financing will
be available in the Company’s Current Report on Form 6-K to be
filed with the Securities and Exchange Commission.
Armentum Partners served as financial advisor to
Strongbridge for this transaction.
About Strongbridge BiopharmaStrongbridge
Biopharma is a global commercial-stage biopharmaceutical
company focused on the development and commercialization of
therapies for rare diseases with significant unmet needs.
Strongbridge's first commercial product is KEVEYIS®
(dichlorphenamide), the first and only FDA-approved treatment for
hyperkalemic, hypokalemic, and related variants of Primary Periodic
Paralysis. KEVEYIS has orphan drug exclusivity status in the U.S.
through August 7, 2022. In addition to establishing this
neuromuscular disease franchise, the Company has a clinical-stage
pipeline of therapies for rare endocrine diseases. Strongbridge's
lead compounds include RECORLEV™
(levoketoconazole), a cortisol synthesis inhibitor currently being
studied for the treatment of endogenous Cushing's syndrome, and
veldoreotide, a next-generation somatostatin analog being
investigated for the treatment of acromegaly, with potential
additional applications in Cushing's syndrome and neuroendocrine
tumors. Both RECORLEV and veldoreotide have received orphan
designation from the U.S. Food and Drug Administration and the
European Medicines Agency. For more information, visit
www.strongbridgebio.com.
About CRGCRG is a premier healthcare-focused
investment firm with more than $3.0 billion of assets under
management across more than 45 portfolio companies. The firm seeks
to commit between $20 to $300 million in each investment across the
healthcare spectrum, including: medical devices,
biopharmaceuticals, tools & diagnostics, services and
information technology. CRG provides growth capital in the form of
long-term debt and equity to support innovative, commercial-stage
healthcare companies that address large, unmet medical needs. The
firm partners with public and private companies to provide flexible
financing solutions and world-class support to achieve exceptional
growth objectives with minimal dilution. CRG maintains offices in
Boulder, Houston and New York. For more information, please
visit www.crglp.com.
Forward-Looking StatementsThis
press release contains forward-looking statements that involve
substantial risks and uncertainties. All statements, other than
statements of historical facts, contained in this press release,
are forward-looking statements. These statements relate to future
events and involve known and unknown risks, including, without
limitation, uncertainties regarding Strongbridge's strategy, plans,
future financial position, anticipated investments, costs and
results, outcomes of product development efforts, status and
results of clinical trials and objectives of management for future
operations. The words "anticipate," "estimate," "expect," "intend,"
"may," "plan," "potential," "project," "target," "will," "would,"
or the negative of these terms or other similar expressions are
intended to identify forward-looking statements, although not all
forward-looking statements contain these identifying words. These
forward-looking statements are based on current expectations,
estimates, forecasts and projections and are not guarantees of
future performance or development and involve known and unknown
risks, uncertainties and other factors. The forward-looking
statements contained in this press release are made as of the date
of this press release, and Strongbridge Biopharma does
not assume any obligation to update any forward-looking statements
except as required by applicable law.
Contacts:
Corporate and Media Relations
Elixir Health Public Relations
Lindsay Rocco
+1 862-596-1304
lrocco@elixirhealthpr.com
Investor Relations
U.S.:
The Trout Group
Marcy Nanus
+1 646-378-2927
mnanus@troutgroup.com
Europe:
First House
Mitra Hagen Negård
+47 21 04 62 19
strongbridgebio@firsthouse.no
USA
900 Northbrook Drive
Suite 200
Trevose, PA 19053
Tel. +1 610-254-9200
Fax. +1 215-355-7389
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