Celsion Enters Into $10 Million Facility With Oxford, Horizon
Celsion Corporation, an oncology drug development company, announced that it has entered into a $10 million tranched loan facility with Oxford Finance and Horizon Technology Finance Corporation.
Under the terms of the loan agreement, Celsion received $5 million upon closing, with the remaining $5 million available for draw following positive data from the company’s pivotal, Phase III HEAT Study. This study is a multinational, randomized, double-blind, placebo-controlled clinical trial of ThermoDox, in combination with radiofrequency ablation (RFA), for the treatment of hepatocellular carcinoma (HCC), also known as primary liver cancer. A total of 380 events of progression are required to reach the planned final analysis of the study, which are projected to occur in late 2012. Celsion expects that the funds will further ensure a strong balance sheet following the announcement of the HEAT Study results, and adds to its ability to conduct pre-commercialization activities and preparation activities related to a New Drug Application (NDA) for ThermoDox(r).
“This facility provides added financial strength to our balance sheet, with each $5 million tranche extending our company’s operating horizon by an additional quarter at current spending levels,” said Gregory Weaver, Celsion’s CFO. “Our current cash position, $24.6 million as of March 31, 2012, is expected to provide sufficient cash to fund operations into the third quarter of 2013. This loan, in addition to our cash reserves and investments, should provide us with the financial flexibility to meet a number of key, value-driving objectives, in addition to providing leverage in evaluating global strategic partners for ThermoDox(r). We appreciate the support of our lender group and their confidence in ThermoDox(r), the HEAT Study and Celsion.”
The loan facility was led by Oxford Finance LLC and partnered with Horizon Technology Finance Corporation. Christopher A. Herr, managing director at Oxford Finance, said: “We are pleased to have led this $10 million loan facility to support the execution of Celsion’s HEAT Study. Through our diligence process, we have gained great confidence in the trial’s rigorous design and execution.”
The initial $5 million tranche is structured to have an interest-only period through March 31, 2013. The second $5 million tranche is structured to have an interest-only period for the three months following the date of funding. Both tranches will be followed by a 30-month amortization period. In conjunction with the loan, Celsion granted the lenders warrants to purchase an aggregate of 51,370 shares at an exercise price of $2.92, or 3% of the funded loan amount. Warrants of equivalent value will be due if the second tranche is drawn.