Motif Bio plc (AIM/NASDAQ: MTFB), a clinical-stage biopharmaceutical company specialising in developing novel antibiotics, today announced that Motif BioSciences Inc. (a wholly owned subsidiary) has entered into an amendment agreement with its lender Hercules Capital, Inc (NYSE:HTGC) (“Hercules”) in relation to the loan agreement as notified on 15 November 2017.
Motif Bio plc (AIM/NASDAQ: MTFB), a clinical-stage biopharmaceutical company specialising in developing novel antibiotics, today announced that Motif BioSciences Inc. (a wholly owned subsidiary) has entered into an amendment agreement with its lender Hercules Capital, Inc (NYSE:HTGC) (“Hercules”) in relation to the loan agreement as notified on 15 November 2017.
Pursuant to the amendment, Motif BioSciences Inc. will make an immediate early repayment of $7 million and will make a further repayment of $0.5 million on the earlier of 90 days, being 18 May 2019, or receipt of funds from an equity raise of $2 million or greater. There will be a three-month interest-only period on the remaining loan, and Hercules has waived any applicable prepayment charges. As a result, future interest and amortisation payments will be substantially lower than before. Though the Company remains in compliance with the terms of its loan agreement, it has agreed to this amendment in order to avoid unilateral action by Hercules based upon any position that Hercules may take that the Company is in default.
Following the $7 million repayment, Motif Bio will have cash of approximately $3 million and $7.7 million of outstanding debt drawn from the Hercules loan facility. Following this amendment, the Company intends to manage the funds available to it aggressively and will need to raise capital in the near term.
Following receipt of a Complete Response Letter (CRL) from the U.S. Food & Drug Administration (FDA), as notified to the market on 14 February 2019, the Company has been consulting with its internal and external experts and is preparing the required information package to request a meeting with the FDA as soon as possible to discuss the CRL. As previously stated, once requested, the FDA typically grants a meeting within 30-45 days. However, there can be no guarantee as to the date of a meeting with the FDA and no certainty that the funds available to the Company, without an additional capital raise, will enable it to reach this date. The Company is currently assessing the options available to it to raise sufficient capital to provide cash runway to enable it to meet the FDA and discuss options to advance iclaprim towards approval.
The Company plans to hold a conference call this week to discuss recent events and the Company’s plans and will provide the details in due course.
The person who arranged for the release of this announcement on behalf of Motif Bio plc was Jon Gold, Interim Chief Financial Officer.
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