Mast Therapeutics, Inc., a biopharmaceutical company developing novel, clinical-stage therapies for sickle cell disease and heart failure, announced that it has entered into an amendment to its existing $15 million debt facility with Hercules Capital, Inc.
The amendment modified key dates in the loan and security agreement to make them subsequent to the Company's anticipated timing for top-line data of its Phase 3 clinical study of vepoloxamer in patients with sickle cell disease, known as the EPIC study. The prepayment condition now requires that $10 million be repaid on July 31, 2016 if positive results from the EPIC study have not been demonstrated to Hercules by that date. The capital raise requirement was eliminated. In addition, the amortization date was extended from June 1 to July 1, 2016, and, in the case of positive EPIC data by July 31, 2016, the amortization date will be extended to March 1, 2017, provided that no event of default has occurred. The Company expects top-line data from the EPIC study in the second quarter of 2016.
In connection with the debt facility amendment, the Company paid Hercules a fee of $37,500 and amended its warrant agreement with Hercules to reduce the warrant exercise price to $0.275, which has the effect of providing the lender with the right to purchase an additional 748,337 shares of the Company's common stock in accordance with the warrant agreement.
"Hercules continues to demonstrate a vested interest in our success," said Brandi Roberts, the Company's Chief Financial Officer. "We believe that this amendment underscores Hercules' confidence in Mast and our development programs."
"We are pleased to work with Mast and are looking forward to the results from the EPIC study. Our financing will help support Mast through this milestone and the future launch of vepoloxamer," said Anup Arora, Managing Director at Hercules.
Mast Therapeutics, Inc. is a publicly traded biopharmaceutical company headquartered in San Diego, California. The Company is developing two clinical-stage investigational new drugs for serious or life-threatening diseases and conditions. Vepoloxamer, the Company's lead product candidate, is in Phase 3 clinical development for the treatment of vaso-occlusive crisis in patients with sickle cell disease and in Phase 2 clinical development for the treatment of patients with heart failure.
Hercules Capital is a leading specialty finance company focused on providing senior secured venture growth loans to high-growth, innovative venture capital-backed companies in a broadly diversified variety of technology, life sciences and sustainable and renewable technology industries. Since inception (December 2003), Hercules has committed more than $5.7 billion to over 335 companies and is the lender of choice for entrepreneurs and venture capital firms seeking growth capital financing.