Oncopeptides has entered into a loan agreement with the European Investment Bank (EIB), granting the company access to an unsecured loan facility of up to 40 million EUR.
The loan may be used to further support the clinical development of melflufen, and the company’s transition from a R&D company into a fully integrated global biopharmaceutical company.
“As the company is approaching a potential commercialization of its lead product melflufen, several new financing options become available. The EIB facility is a flexible solution that can be drawn upon with limited dilution for the shareholders, which is highly valuable to the company in this transition phase. We are grateful for the support from the EIB and look forward to working together through the continued expansion of Oncopeptides,” says Anders Martin-Löf, CFO of Oncopeptides.
A market gap when it comes to “non-dilutive growth capital”
The loan facility is divided into three tranches, each with a maturity of up to five years, which will become available provided that the company reaches certain milestones related to the commercialization of melflufen in the U.S. and the EU, respectively. If the company utilizes the facility, the EIB will be entitled to a predetermined number of warrants in Oncopeptides, in excess of interest on the loan amount. The warrants are divided into three tranches and assuming full drawdown under the loan facility, the EIB will be entitled to warrants corresponding to 0.7 percent of the total number of shares in the company on a fully diluted basis. The total number of warrants will be issued by Oncopeptides’ board of directors pursuant to the authorization granted by the AGM 2020, and each relevant tranche will be delivered to the EIB upon the company’s potential decision to draw the relevant tranche of the loan.
“This is the kind of project that the Investment Plan for Europe was set up to support. There is still a market gap when it comes to what is called “non-dilutive growth capital”, allowing innovative, fast growing EU-based SMEs to grow without giving up ownership of their ideas or company,” says Thomas Östros, Vice-President of EIB. “We are very happy to get behind yet another innovative Swedish company that has ground-breaking plans for the future.”
Photo of Anders Martin-Löf, CFO, Oncopeptides
