Daily News: December 30, 2016

Oxford, Horizon Provide $40MM Facility for Strongbridge Biopharma

Strongbridge Biopharma closed a $35 million equity financing and a $40 million credit facility.

The senior credit facility was provided by Oxford Finance and Horizon Technology Finance. It consists of $20 million borrowed initially with access to two additional tranches of $10 million each. The additional tranches will be available to the company subject to certain specified milestones.

The credit facility matures after 48 months, provides interest-only payments initially for the first 18 months of the loan followed by an amortization period of 30 months, provides for a final payment fee equal to 8% of the amount borrowed, and bears interest at a rate equal to the sum of 8.22% plus the greater of 0.53% or the 30-day U.S. LIBOR rate.

If the company satisfies certain milestones and borrows the final $10 million tranche, the interest-only period would be extended by an additional six months and the amortization period would be 24 months. The company has granted a security interest in substantially all of its existing and after-acquired assets, including intellectual property. The credit facility contains facility and prepayment fees, customary affirmative and negative covenants, and events of default. The company has issued 10-year warrants to the lenders to purchase an aggregate of 428,571 ordinary shares at an exercise price of $2.45 per share.

Trevose, PA-based Strongbridge Biopharma is a global commercial-stage biopharmaceutical company focused on the development and commercialization of therapies for rare diseases with significant unmet needs.