Cerus has closed a new debt facility with MidCap Financial (MidCap) which is expandable up to $90 million. The debt facility consists of a staged $70 million term loan and a $5 million revolving line of credit, expandable up to $20 million.
The new term loan provides an initial tranche of $40 million at closing. Cerus has the option to draw on two additional $15 million tranches contingent upon the achievement of specific clinical and commercial milestones. The first optional tranche is available to Cerus upon either CE Mark approval for the INTERCEPT red blood cell system or a PMA supplement approval for INTERCEPT cryoprecipitate. A second option is available upon Cerus’ achievement of certain predetermined revenue levels. A portion of the initial proceeds will be used to retire the company’s existing term loan of approximately $29 million. In addition to the term loan, the company closed on a $5 million revolving loan to help fund investment in working-capital to meet the growth in the business over the next several years. The revolving facility can expand to $20 million based on mutual agreement.
“The non-dilutive financing provides Cerus with additional capital and flexibility to fund our growth initiatives,” said Kevin D. Green, Cerus’ vice president, finance and chief financial officer. “The new term loan not only provides Cerus with additional capital at an attractive rate, but the amortization is deferred for 36 months and can be extended for an additional 12 months upon achievement of predetermined revenue levels allowing us to focus on business execution.”
“MidCap was a true collaborative partner during this entire process,” continued Green. “As a testament to MidCap’s industry expertise in life science lending, their appreciation and understanding of our business opportunity and the company’s mission to make INTERCEPT the global standard of care was clearly evident.”