Stealth BioTherapeutics Closes $ 25 Million Debt Financing with Horizon Technology Finance
Posted: October 4, 2021 at 7:30 a.m. EDT|Update: 8 hours ago
BOSTON, October 4, 2021 / PRNewswire / – Stealth BioTherapeutics Corp (Nasdaq: MITO), a clinical-stage biotechnology company focused on the discovery, development and commercialization of novel therapies for diseases involving mitochondrial dysfunction, today announced the completion of a $ 25 million long-term debt facility led by Horizon Technology Finance Corporation (Nasdaq: HRZN) (âHorizonâ). Stealth has decreased $ 15 million under the installation with a supplement $ 10 million available upon reaching a predetermined milestone.
“We are delighted to partner with Horizon to meet our funding needs in a way that balances our short-term capital needs with our sensitivity to shareholder dilution,” said Reenie mccarthy, Chief Executive Officer. âThis transaction strengthens and expands our financial resources as we plan to launch several new clinical trials in the coming months, advancing our business planning for Barth syndrome, for which we recently submitted an NDA that is under review. ‘review by the FDA, and prepare for Phase 2 data reading in extra-foveal geographic atrophy associated with dry AMD. “
Gerald A. Michaud, President of Horizon said, âWe are delighted to provide this funding which will allow Stealth to advance its development of novel therapies for rare and common diseases of mitochondrial dysfunction for which there are no approved treatments. This investment in Stealth provides another example of our ability to fund life science companies through multiple stages of development and through various value inflection points. “
Fifteen million dollars of $ 25 million the installation was funded at closure and $ 5.7 million of which was used to repay Stealth’s existing term loan with Hercules Capital. The supplement $ 10 million available under the facility can be funded when Stealth reaches a predetermined milestone. Each loan facility advance will be repaid in 48 monthly installments consisting of 18 monthly interest only installments, followed by 30 monthly installments of principal and accrued interest, and will be payable monthly in arrears. The interest-only period can be extended to 24 months provided Stealth meets certain milestones, followed by 24 monthly payments of principal and accrued interest. In connection with the financing, Stealth issued Horizon warrants to purchase up to 13,636,364 common shares at an exercise price of $ 0.11 per share (or $ 1.33 by American Depository Share (âADSâ) of the Company on a basis equivalent to ADS). Proceeds from the facility will be used to support the ongoing clinical development of key investigational product candidates in the Stealth pipeline and for general working capital purposes.
We are a clinical-stage biotechnology company focused on the discovery, development and commercialization of novel therapies for diseases involving mitochondrial dysfunction. Mitochondria, found in almost every cell in the body, are the body’s main source of energy production and are essential for normal organ function. Dysfunctional mitochondria characterize a number of rare genetic diseases and are implicated in many common age-related diseases, typically involving energy-intensive organ systems such as the heart, eyes, and brain. We believe that our lead product candidate, elamipretid, has the potential to treat both rare metabolic cardiomyopathies, such as Barth’s muscular dystrophy, Duchenne’s muscular dystrophy, and Friedreich’s ataxia, rare mitochondrial diseases resulting in mutations of nuclear DNA, as well as ophthalmic diseases resulting in mitochondrial dysfunction, such as dry age-related macular degeneration and Leber’s hereditary optic neuropathy. We are evaluating our second generation clinical stage candidate, SBT-272, and our new small molecule series, SBT-550, for indications of rare neurological diseases following promising preclinical data. We have optimized our discovery platform to identify novel mitochondria-targeted compounds that can be named as therapeutic product candidates or used as mitochondria-targeted vectors to deliver other compounds to mitochondria.
About Horizon Technology Finance
Horizon Technology Finance Corporation (NASDAQ: HRZN) is a leading specialty finance company providing capital in the form of secured loans to venture-backed companies in the technology, life sciences, health information and services and sustainable development. Horizon’s investment objective is to maximize the return on its investment portfolio by generating current income from the debt investments it makes and capital appreciation from the warrants it receives. during these debt investments. Horizon is headquartered at Farmington, Connecticut, with a regional office in Pleasanton, California, and investment professionals located in Portland, Maine, Austin, Texas, and Reston, Virginia. For more information, please visit www.horizontechfinance.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include those regarding Stealth BioTherapeutics’ plans, strategies and expectations for the preclinical and clinical advancement of its drug development programs, including including its ongoing clinical trials with elamipretid and its planned clinical trial with SBT-272; its expectations regarding regulatory interactions regarding its recent submission of an NDA for Barth syndrome, including its belief that existing data may provide sufficient evidence to support the review of the NDA; its plans for using the product from the facility; the potential benefits of Stealth BioTherapeutics’ product candidates; its key milestones for 2021 and 2022; and its plans for future data presentations. Statements that are not historical facts, including statements about Stealth BioTherapeutics beliefs, plans and expectations, are forward-looking statements. The words “anticipate”, “expect”, “hope”, “plan”, “possible”, “possible”, “will”, “believe”, “estimate”, “intend”, “may “,” Power “,” predict “,” project “,” would “and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Stealth BioTherapeutics may not achieve the plans, intentions or expectations disclosed in these forward-looking statements, and you should not place undue reliance on such forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements due to known and unknown risks, uncertainties and other important factors, including: the ability of Stealth BioTherapeutics to obtain additional funding and to continue as a going concern; the impact of the COVID-19 pandemic; the ability to successfully demonstrate the efficacy and safety of Stealth BioTherapeutics’ product candidates and future product candidates; the preclinical and clinical results of Stealth BioTherapeutics’ product candidates, which may not support further development and marketing authorization; the potential benefits of Stealth BioTherapeutics’ product candidates; the content and timing of decisions made by the FDA, EMA or other regulatory authorities, investigative review boards at clinical trial sites, and publication review bodies, which may affect the initiation, timing and progression of preclinical studies and clinical trials of Stealth BioTherapeutics product candidates; the possibility that the FDA will not file the Barth NDA; Stealth BioTherapeutics’ ability to obtain and maintain required regulatory approvals and enroll patients in its planned clinical trials; unforeseen cash flow needs and expenses; competitive factors; Stealth BioTherapeutics’ ability to obtain, maintain and enforce patents and other intellectual property protections for all product candidates it develops; and general economic and market conditions. These and other risks are described in more detail under the heading “Risk Factors” included in Stealth BioTherapeutics’ most recent annual report on Form 20-F filed with the Securities and Exchange Commission (“SEC”), as well as in any future SEC filings. Forward-looking statements represent the current expectations of management and are inherently uncertain. Except as required by law, Stealth BioTherapeutics assumes no obligation to update any forward-looking statements we have made to reflect subsequent events or circumstances.
Serious investor relations
Janhavi Mohite, 212-362-1200
View original content to download multimedia:
SOURCE Stealth BioTherapeutics Inc.
The above press release has been provided courtesy of PRNewswire. The views, opinions and statements contained in the press release are not endorsed by Gray Media Group and do not necessarily state or reflect those of Gray Media Group, Inc.