Publicly traded NuPathe Inc., a specialty pharmaceutical company, has entered into a $8.5 million term loan agreement with Hercules Technology Growth Capital. NuPathe will use the proceeds to pay off an existing term loan facility, and for general working capital.
NuPathe Inc. (NASDAQ: PATH), a specialty pharmaceutical company focused on the development and commercialization of branded therapeutics for diseases of the central nervous system, today announced that it has entered into a $8.5 million term loan agreement with Hercules Technology Growth Capital.
“This new loan with Hercules provides us with better control over our cash flow and capital resources,” said Keith A. Goldan, vice president and chief financial officer of NuPathe. “In addition to paying off our existing loan, this new facility allows us to continue to focus on our key objectives of obtaining FDA approval for Zecuity™, securing commercial partners, and conducting additional pre-launch activities for our new migraine treatment.”
The term loan provides for interest-only payments for the first twelve months, has no requirement for restricted cash balances, and has a total maturity period of 42 months. The loan bears a per annum interest rate of the greater of 9.85% or the prime rate minus 3.25%. The loan is secured by a first position lien on all of NuPathe’s assets, excluding intellectual property, which is subject to a negative pledge prohibiting NuPathe from granting liens on such assets to any third parties. Approximately $8.0 million of the loan proceeds will be used to pay off NuPathe’s existing term loan facility with the remaining proceeds to be used for general working capital purposes. Hercules received $42,500 in cash, 50,000 shares of common stock and a five-year warrant to purchase 106,631 shares of NuPathe common stock at an exercise price equal to $2.79 per share. Further information with respect to the loan agreement with Hercules will be contained in a Current Report on Form 8-K which NuPathe will file with the Securities and Exchange Commission.
NuPathe Inc. is a specialty pharmaceutical company focused on innovative neuroscience solutions for diseases of the central nervous system including neurological and psychiatric disorders. NuPathe’s lead product candidate, Zecuity (previously referred to as Zelrix or NP101) is an active, single-use, transdermal sumatriptan patch being developed for the treatment of migraine. In addition to Zecuity, NuPathe has two proprietary product candidates based on its LAD™, or Long-Acting Delivery, biodegradable implant technology that allows delivery of therapeutic levels of medication over a period of months with a single dose. NP201, for the continuous symptomatic treatment of Parkinson’s disease, utilizes a leading FDA-approved dopamine agonist, ropinirole, and is being developed to provide up to two months of continuous delivery. NP202, for the long-term treatment of schizophrenia and bipolar disorder, is being developed to address the long-standing problem of patient noncompliance by providing three months of continuous delivery of risperidone, an atypical antipsychotic. NuPathe is actively seeking partnerships to maximize the commercial potential for its product candidates in the U.S. and territories throughout the world.
For more information about NuPathe, please visit our website and our blog at www.nupathe.com. You can also follow us on StockTwits (stocktwits.nupathe.com), Twitter (twitter.nupathe.com), SlideShare (slideshare.nupathe.com) and LinkedIn (linkedin.nupathe.com).
Cautionary Note Regarding Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements that are not historical facts are hereby identified as forward-looking statements for this purpose and include, among others, statements relating to: the benefits of the new loan with Hercules; the use of proceeds from the new loan; partnering plans for NuPathe’s product candidates; the potential benefits of, and commercial opportunity for, NuPathe’s product candidates; and other statements relating to NuPathe’s plans, objectives, expectations and beliefs regarding our future operations, performance, financial condition and other events.
Forward-looking statements are based upon our current expectations, plans and beliefs and are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and events to differ materially and adversely from those indicated by such statements including, among others: NuPathe’s ability to obtain additional capital on a timely basis and on agreeable terms to meet its interest and repayment obligations under the new loan; NuPathe’s ability to obtain FDA approval of Zecuity; the extent to which the FDA may request or require additional information, studies or redesign of Zecuity and the costs and time required to complete such activities; NuPathe’s ability to obtain partners for its product candidates; varying interpretation of trial, study and market data; and the other factors discussed in NuPathe’s Annual Report on Form 10-K for the year ended December 31, 2011 and in its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2012, under the caption “Risk Factors” and elsewhere in such reports, which are available on NuPathe’s website at www.nupathe.com in the “Investor Relations — SEC Filings” section. While NuPathe may update certain forward-looking statements and Risk factors from time to time, NuPathe specifically disclaims any obligation to do so, whether as a result of new information, future developments or otherwise. You are cautioned not to place undue reliance on any forward-looking statements.