Pelthos Therapeutics, a biopharmaceutical company committed to commercializing innovative therapeutic products for unmet patient needs, secured financing from Horizon Technology Finance, an affiliate of Monroe Capital, with an initial funding of $30 million, and up to $20 million to support future growth.
“We believe this transaction with Horizon gives Pelthos the flexibility and resources to accelerate the commercialization of our cutaneous infectious disease product portfolio, strengthens our balance sheet and, most importantly, brings ZELSUVMI, the first and only FDA approved treatment for molluscum for use at home and on the go to doctors, individuals and families struggling with such a persistent and difficult to treat infection. We will continue to execute on our corporate strategy, which focuses on providing innovative treatment options for patients in need, particularly children and families struggling with highly communicable infections,” Scott Plesha, CEO of Pelthos, said.
“We are pleased to partner with Scott and the strong Pelthos management team as they advance important therapies for underserved cutaneous indications. We believe the Pelthos team brings the experience, expertise and commitment needed to deliver meaningful results across a portfolio addressing significant unmet needs. We look forward to supporting their continued growth as they expand access to innovative dermatologic treatments,” Paul Seitz, chief investment officer of Horizon, said.
Horizon funded $30 million at closing, with up to an additional $20 million available upon achieving certain milestones. The rate is Prime plus 3.75%, currently 10.50%, paid only on drawn capital. The term is 60 months with amortization beginning at month thirty-six with the ability to begin in month 48, if certain milestones are met and interest only until amortization commences. In connection with the financing, Pelthos issued Horizon warrants to purchase 65,488 shares of its common stock, par value $0.0001 per share, at an exercise price of $27.49 per share. Proceeds from the financing will be used to support the commercialization of ZELSUVMI, launch Xepi and Xeglyze and for working capital and general corporate purposes.
Other than the limited number of shares of common stock issuable upon exercise of the warrants issued in connection with the facility, the capital raised is non-dilutive to existing shareholders of the company.
“We want to thank Horizon for their commitment to Pelthos, their professionalism and the depth of their work to complete this transaction. Our experience with ZELSUVMI is that the more that investors understand the burden of this pox virus, and the unique features and benefits of ZELSUVMI, the more excited they become about this opportunity. Importantly, we believe this credit facility demonstrates our intent to manage our equity capitalization efficiently, without compromising the launch of our first three products,” Frank Knuettel II, chief financial officer of Pelthos, said.
Oppenheimer & Co. served as financial advisor and Morgan, Lewis & Bockius and Sullivan & Worcester acted as legal advisors to Pelthos. Holland & Knight served as legal advisor to Horizon.
