CELEBRATION, Fla., April 10, 2024 (GLOBE NEWSWIRE) — Zevra Therapeutics, Inc. THE BEAST (Zevra, or the Company), a rare disease therapeutics company, today announced that it has signed a new credit facility provided by leading biotechnology investors. Led by Perceptive Advisors and Healthcare Royalty, the new credit facility provides up to $100 million in committed capital in three tranches: an initial draw of $60 million at closing, a second tranche of up to $20 million available through the 5th October 2025 and a third tranche of up to $20 million that will be available upon approval of arimoclomol, the company's product candidate for the treatment of Niemann Pick disease type C (NPC), in each case subject to certain terms and Conditions. As part of this transaction, the Company has repaid its combined existing debt of approximately $43.1 million.
The net proceeds from the initial draw of $60 million, after repayment of existing debt, original issue discount and fees and expenses associated with this transaction, are approximately $14.0 million.
The new five-year credit facility bears interest at the 3-month secured overnight financing rate (SOFR) (subject to a 4.00% annual minimum). further 7.00% per year, whose global interest rate is currently 12.33% per year. Zevra has the option to pay up to 25% of interest on outstanding principal amounts in kind up to and including March 31, 2026, subject to certain terms and conditions. The line of credit pays interest only over its five-year term, with all outstanding principal due on the maturity date of April 5, 2029, and includes certain customary covenants and obligations.
“Entering this new credit facility is another step in executing our strategic vision for Zevra to become a leading rare disease company,” said R. LaDuane Clifton, Zevra's chief financial officer, secretary and treasurer. “By restructuring amounts previously outstanding across two different facilities, we have simplified and extended maturity while providing additional non-dilutive capital flexibility to support our 2024 strategic priorities, which are to (i) successfully launch OLPRUVA® and secure the patient access, (ii) prepare for the launch of arimoclomol, if approved, and (iii) advance our KP1077 development program in sleep disorders. As a result of this transaction, and based on our current operating plan , cash on hand, cash equivalents and investments, We expect our cash runway to expand further through 2026.”
“Zevra Therapeutics is uniquely positioned to generate value through its commercial and development assets,” said Sam Chawla, portfolio manager of Perceptive Advisors credit funds. “With multiple near-term catalysts, including potential product approval later this year and upcoming development milestones, we are excited to support the company and management team as they continue to grow toward profitability.”
Founded in 1999, Perceptive Advisors is focused on supporting progress in the life sciences industry by identifying opportunities and directing financial resources toward the most promising technologies in modern healthcare. Today, the company manages approximately $8 billion across its strategies.
HealthCare Royalty (“HCRx”) is a leading royalty acquisition company focused on commercial or near-commercial stage biopharmaceutical products. HCRx has invested more than $5 billion in more than 85 biopharmaceutical products since its inception with offices in Stamford (CT), San Francisco, Boston and London. For more information visit https://www.hcrx.com/. HEALTHCARE ROYALTY® and HCRx® are registered trademarks of HealthCare Royalty Management, LLC.
Armentum Partners acted as exclusive financial advisor to Zevra on the transaction. Latham and Watkins acted as legal advisors to Zevra. Moore & Van Allen acted as legal advisors to the Lenders. For more information regarding the financing and applicable terms and conditions, see the Current Report on Form 8-K filed today by Zevra with the Securities and Exchange Commission (SEC).
About Zevra Therapeutics
Zevra Therapeutics is a rare disease company that combines science, data and patient needs to create transformative therapies for diseases with limited or no treatment options. Our mission is to provide life-changing therapies to people living with rare diseases. With unique data-driven development and commercialization strategies, the company is overcoming complex drug development challenges to make new therapies available to the rare disease community.
For more information please visit www.zevra.com or follow us on x (formerly Twitter) and LinkedIn.
Caution Regarding Forward-Looking Statements
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not relate solely to historical or current facts, including, but not limited to, statements about the promise and potential impact. from our clinical or preclinical trial data; the promise and potential impact of any of our products or product candidates for any specific disease indication or at any dose; the possible approval and subsequent commercial launch of arimoclomol; the possible launch or commercialization of any of the product candidates or products, including OLPRUVA, the sufficiency of our cash, cash equivalents and investments to finance our operating activities during any specified period of time, and our strategic and product development objectives, including with respect to becoming a leading commercially focused rare disease company. Forward-looking statements are based on information currently available to Zevra and its current plans or expectations. They are subject to various known and unknown uncertainties, risks and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These and other important factors are described in detail in the “Risk Factors” section of Zevra's Annual Report on Form 10-K for the year ended December 31, 2023 and in Zevra's other filings with the Exchange Commission. and Values. Although we may elect to update such forward-looking statements at some time in the future, except as required by law, we disclaim any obligation to do so even if subsequent events cause our views to change. Although we believe that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.
Contact Zevra
Nichol Ochsner
+1 (732) 754-2545
nochsner@zevra.com
Russo Partners Contacts
Adanna G. Alexander, Ph.D.
+1 (646) 942-5603
adanna.alexander@russopartnersllc.com
Ignacio Guerrero-Ros, Ph.D.
+1 (646) 942-5604
ignacio.guerrero-ros@russopartnersllc.com
