Auris Medical Holding entered into a loan facility agreement with Hercules Capital for up to $20 million in financing.

Auris Medical has closed the first tranche of financing of $12.5 million. Funding of a second tranche of financing of up to $7.5 million is, among other factors, subject to the Phase 3 TACTT2 clinical trial with KeyzilenTM (AM-101) meeting its co-primary endpoints.

“This financing provides us with greater balance sheet strength and flexibility as we advance our Phase 3 clinical development programs and prepare for the potential commercialization of KeyzilenTM,” commented Thomas Meyer, Auris Medical’s founder, chairman and CEO.

The financing is in the form of a 42-month loan bearing interest at a minimum rate of 9.55% per annum, and is subject to the variability of the prime interest rate. Terms include an initial interest-only period until June 30, 2017, which is extendable to March 31, 2018, subject to certain conditions. Auris Medical issued Hercules a warrant to purchase up to 241,117 shares of the company’s common stock at an exercise price

Swiss-based Auris Medical is a biopharmaceutical company dedicated to developing therapeutics that address unmet medical needs in otolaryngology.

Hercules Capital is a specialty finance company focused on providing senior secured venture growth loans to high-growth, innovative venture capital-backed companies in a broad variety of technology, life sciences and sustainable and renewable technology industries.