Strengthens financial flexibility to support the Company’s continued growth
Verona Pharma plc, announces it and its wholly-owned subsidiary, Verona Pharma, Inc. (the “Company”), have entered into a debt financing facility (“debt facility”) providing the Company with access to up to $400 million from funds managed by Oxford Finance LLC (“Oxford”) and Hercules Capital, Inc. (NYSE: HTGC) (“Hercules”) (collectively, the “Lenders”). The debt facility provides non-dilutive capital and further financial flexibility to support Verona Pharma’s continued growth, including the planned commercial launch of ensifentrine, Verona Pharma’s first-in-class product candidate, which is under review by the US Food and Drug Administration for the maintenance treatment of chronic obstructive pulmonary disease (“COPD”). The debt facility replaces the existing facility of up to $150 million with an affiliate of Oxford.
Under the terms of the debt facility, the Company drew $50 million at closing, and may draw, subject to certain conditions precedent, an additional $100 million upon approval of ensifentrine, $150 million in two separate tranches upon achievement of certain net sales milestones and, subject to the approval of the Lenders, $100 million to support strategic initiatives. Verona Pharma will pay only interest on the outstanding loans under the debt facility for the first 53 months with the outstanding principal of the loans under the debt facility amortized over the subsequent 7 months. The $20 million drawn and fees and associated costs due to Oxford on the discharge of the existing debt facility will be paid to Oxford on closing of the debt facility.
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“We are pleased to have secured access to this expanded and flexible facility with Oxford, who has trusted us with debt finance over the past year, and having Hercules join as an additional financing partner. This new facility, along with our existing cash, which was $257.4 million at September 30, 2023, provides us with additional financial flexibility to support Verona Pharma’s continued growth, including the planned launch of ensifentrine in the US, if approved,” said David Zaccardelli, Pharm. D., President and Chief Executive Officer. “We look forward to the Prescription Drug User Fee Act (“PDUFA”) target action date of June 26, 2024.”
“We are thrilled to announce our expanded financial support for our existing client, Verona Pharma,” said Adam K. Soller, Managing Director at Oxford. “As we anticipate their first potential approval of the company’s lead product candidate, ensifentrine, for the maintenance treatment of patients with COPD, our increased loan facility underscores our commitment to advancing ground-breaking solutions for respiratory health.”
“We are excited to collaborate with Verona Pharma as they take the next step in their important mission of bringing a novel treatment to COPD patients worldwide,” said Michael McMahon, Director of Healthcare and Life Sciences with Hercules. “Verona Pharma has many of the underpinnings Hercules looks for when partnering with companies: the combination of an experienced team, a novel, efficacious treatment and, most importantly, the potential to address a large, underserved patient population,” added Kristen Kosofsky, Senior Managing Director of Healthcare and Life Sciences with Hercules.
Verona Pharma is a clinical-stage biopharmaceutical company focused on developing and commercializing innovative therapies for the treatment of chronic respiratory diseases with significant unmet medical needs. If successfully developed and approved, Verona Pharma’s product candidate, ensifentrine, has the potential to become the first non-steroidal therapy for the treatment of respiratory diseases that combines bronchodilator and anti-inflammatory activities in one molecule. The Company has evaluated nebulized ensifentrine in its Phase 3 clinical program ENHANCE (“Ensifentrine as a Novel inHAled Nebulized COPD thErapy”) for COPD maintenance treatment. Ensifentrine met the primary endpoint in both ENHANCE-1 and ENHANCE-2 trials demonstrating statistically significant and clinically meaningful improvements in lung function. In addition, ensifentrine substantially reduced the rate and risk of COPD exacerbations in pooled analysis from ENHANCE-1 and ENHANCE-2. In the third quarter of 2023, the US Food and Drug Administration accepted for review the Company’s NDA for ensifentrine for the maintenance treatment of patients with COPD and assigned a PDUFA target action date of June 26, 2024. Two additional formulations of ensifentrine have been evaluated in Phase 2 trials for the treatment of COPD: dry powder inhaler (“DPI”) and pressurized metered-dose inhaler (“pMDI”). Ensifentrine has potential applications in cystic fibrosis, non-cystic fibrosis bronchiectasis, asthma and other respiratory diseases.
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