Aerie Pharmaceuticals, Inc. (Aerie), an ophthalmic pharmaceutical company focused on the discovery, development and commercialization of first-in-class therapies for the treatment of patients with open-angle glaucoma, retinal diseases and other diseases of the eye, today announced that it has entered into an amendment of its existing credit agreement with certain affiliates of Deerfield Management Company L.P. (Deerfield).
The amendment provides for an additional $100 million senior secured delayed draw term loan facility (the additional credit facility), pursuant to which Aerie may borrow up to $100 million in aggregate in one or more borrowings at any time on or prior to July 23, 2020. Amounts drawn under the additional credit facility will amortize in equal annual installments beginning on July 20, 2023 and will mature on July 23, 2024. With the additional credit facility, Aerie has $200 million in total available. When added to the $203 million in cash and cash equivalents reported as of December 31, 2018, the additional credit facility brings Aerie’s total pro forma liquidity to over $400 million for 2019.
The additional credit facility includes an interest rate on drawn amounts of LIBOR (subject to a floor of 2%) plus 7.20%, up to a maximum rate of 13.00%, and fees on undrawn amounts of 2.0% per annum. Fees on undrawn amounts accrue through, and are payable on, the earlier of July 23, 2020 and the termination of the facility, and no principal payments will be due on drawn amounts, if any, until July 23, 2020. The additional credit facility may be terminated by Aerie at any time for an additional one-time fee of $2.625 million if undrawn, or $5.25 million if any amounts have been drawn, which fee (or applicable portion thereof) will be payable in connection with any repayment of drawn amounts and, to the extent not previously paid, upon the maturity of the additional facility. In addition, certain premiums and/or make-whole fees will be payable on any drawn amounts that are prepaid on or prior to July 23, 2022. The material terms of the original $100 million facility remain unchanged.
The additional credit facility is available to Aerie for working capital and business expansion and business development purposes, if needed, subject to customary conditions. No amounts were drawn under the additional credit facility at closing. Aerie currently believes it has adequate cash and cash equivalents to support ongoing business operations including the commercialization of Rocklatan®, and currently has no intention to draw on the additional credit facility.
“We are once again delighted about Deerfield’s ongoing support of Aerie. Using our year-end cash and cash equivalents of $203 million as a starting point, we have more than $400 million in liquidity for 2019, representing significant resources at our disposal if needed to build the Company through sales execution, geographic expansion and internal pipeline development, and to be opportunistic with innovative business development prospects,” said Vicente Anido, Jr., Ph.D., Chairman and Chief Executive Officer at Aerie.