LEIDEN, The Netherlands, July 21, 2017 /PRNewswire/ --
Repayment of bridge finance on unchanged terms
Pharming Group N.V. ("Pharming" or "the Company") announces that it has completed the replacement of its recently announced US$100 million bridge finance with OrbiMed Advisors with a US$100 million permanent facility agreement with OrbiMed Advisors. The bridge finance was used to redeem the Amortizing Convertible Bonds due 2017/2018, and to refinance the Company's senior debt facility with Silicon Valley Bank and Kreos Capital, together with the associated prepayment fees and the legal and other costs of the transaction. The loan, initially structured as a bridge facility, has been replaced by a full loan agreement with a maturity date of July 2021 under unchanged terms and conditions as described below.
- One four year $100m (EUR91.7 million) Senior Secured Debt facilty to refinance
debt on more favourable terms to redeem a total of EUR35.9 million (US$39.1 million)
of Amortising Convertible Bonds and refinance US$40 million of Senior Debt.
- Net effect of the refinance:
- Release of 124.2 million shares reserved against the Amortizing Convertible Bonds,
minus just under 9.2 million warrants for OrbiMed, eliminates risk of
approximately 24% current dilution effect for existing shareholders
- Significant reduction of near term cash burn (from amortisations and debt
repayments) of approximately EUR16 million in 2017 and almost EUR8 million in 2018,
which will allow for investment in RUCONEST(R) commercialisation and pipeline
- Existing EUR11.8 million 5 year (December 2021) 8.5% Ordinary Convertible Bonds
are unaffected by this transaction.
- No significant effect on Company's cash balance.
Dr Sijmen de Vries, CEO of Pharming, commented:
"We are delighted to announce that we now completed the full refinancing of the Senior Debt and Amortizing Convertible Bonds on such excellent terms. OrbiMed Advisors is one of the world's leading specialty debt investors in the life science sector, and we are very pleased to have them as a long term partner.
This new refinance enabled us to remove from the market the likelihood of issue of a substantial part of our authorized share capital (124 million shares) that was tied to the Amortising Convertible Bonds facility. With a conversion price of EUR0.289, these Bonds might otherwise have been converted into shares at significant discount to the current market price.
The net effect on the Company's financial statements is also very positive. We will not be required to make repayments over the next 12 months of almost EUR3 million per month in cash (or in shares at a discount) on the Amortizing Convertible Bonds, nor to make repayments of almost EUR1 million per month on the senior debt from December this year until September of next year. This allows us to invest our cash into promoting RUCONEST(R) and developing our pipeline and facilities, thereby enhancing growth opportunities.
This is, therefore, another good day for all our stakeholders."
New permament Debt Facility
- The Company has signed an agreement with OrbiMed Advisors (the Lender) for a
US$100 million (EUR91.7 million), four year debt facility on improved commercial
terms. The overall interest rate is approximately 12%, reducing to 11% if the Company
achieves net sales in the USA of US$100 million per annum during the term of the loan.
Only part of the interest must be paid in cash. The loan will be interest only for
twelve months, after which it will amortise in equal quarterly tranches until July
- The loan has been used to redeem the current Amortizing Convertible Bonds due
2017/2018, in an amount of EUR44.9 million including early repayment fees, and also to
refinance the existing senior debt facility in an amount of EUR43.3 million including
early repayment fees.
- As a result of the retirement of the Amortizing Bonds, the 124.2 million shares which
were reserved against conversion of the remaining Amortizing Bonds, are no longer
reserved for that purpose, and have been returned to treasury. Net of the shares
which will be reserved for the new warrants, this means a total of 115.0 million
shares (approximately 24% of the issued share capital). The Company has no plans to
issue these shares at this time.
- Also as a result of this transaction, the Company's cash burn will be reduced by the
likely amount of cash repayments under the Amortizing Convertible Bonds in the rest of
2017 and in 2018, plus the amount of the cash repayments on the senior debt facility
which would have started in December 2017. The net positive effect during the
remainder of 2017 is expected to be EUR12.3 million, and the net positive effect in
2018 is expected to be EUR7.7 million. This excludes the effects on the Company of any
repayments of the Amortizing Convertible Bonds which might have been made in shares.
About Pharming Group N.V.
Pharming is a specialty pharmaceutical company developing innovative products for the safe, effective treatment of rare diseases and unmet medical needs. Pharming's lead product, RUCONEST(R) (conestat alfa) is a recombinant human C1 esterase inhibitor approved for the treatment of acute Hereditary Angioedema ("HAE") attacks in patients in Europe, the US, Israel and South Korea. The product is available on a named-patient basis in other territories where it has not yet obtained marketing authorization.
RUCONEST(R) is commercialized by Pharming in Algeria, Andorra, Austria, Bahrain, Belgium, France, Germany, Ireland, Jordan, Kuwait, Lebanon, Luxembourg, Morocco, the Netherlands, Oman, Portugal, Qatar, Syria, Spain, Switzerland, Tunisia, the United Arab Emirates, the United Kingdom, the United States of America and Yemen.
RUCONEST(R) is distributed by Swedish Orphan Biovitrum AB (publ) (SS: SOBI) in the other EU countries, and in Azerbaijan, Belarus, Georgia, Iceland, Kazakhstan, Liechtenstein, Norway, Russia, Serbia and Ukraine. RUCONEST(R) is distributed in Argentina, Colombia, Costa Rica, the Dominican Republic, Panama, and Venezuela by Cytobioteck, in South Korea by HyupJin Corporation and in Israel by Megapharm.
RUCONEST(R) is also being investigated in a Phase II clinical trial for the treatment of HAE in young children (2-13 years of age) and evaluated for various additional follow-on indications.
Pharming's technology platform includes a unique, GMP-compliant, validated process for the production of pure recombinant human proteins that has proven capable of producing industrial quantities of high quality recombinant human proteins in a more economical and less immunogenetic way compared with current cell-line based methods. Leads for enzyme replacement therapy ("ERT") for Pompe and Fabry's diseases are being optimized at present, with additional programs not involving ERT also being explored at an early stage at present.
Pharming has a long term partnership with the China State Institute of Pharmaceutical Industry ("CSIPI"), a Sinopharm company, for joint global development of new products, starting with recombinant human Factor VIII for the treatment of Haemophilia A. Pre-clinical development and manufacturing will take place to global standards at CSIPI and are funded by CSIPI. Clinical development will be shared between the partners with each partner taking the costs for their territories under the partnership.
Pharming has declared that the Netherlands is its "Home Member State" pursuant to the amended article 5:25a paragraph 2 of the Dutch Financial Supervision Act.
Additional information is available on the Pharming website: http://www.pharming.com
About OrbiMed Advisors
OrbiMed is a leading investment firm dedicated exclusively to the healthcare sector, with over US $13 billion in assets under management. OrbiMed invests globally across the spectrum of healthcare companies, from venture capital start-ups to large multinational companies. OrbiMed's team of more than 90 employees manages a series of private equity funds, public equity funds, royalty/debt funds and other investment vehicles. OrbiMed maintains its headquarters in New York City, with additional offices in San Francisco, Mumbai, Shanghai, and Herzliya.
This press release of Pharming Group N.V. and its subsidiaries ("Pharming", the "Company" or the "Group") may contain forward-looking statements including without limitation those regarding Pharming's financial projections, market expectations, developments, partnerships, plans, strategies and capital expenditures.
The Company cautions that such forward-looking statements may involve certain risks and uncertainties, and actual results may differ. Risks and uncertainties include without limitation the effect of competitive, political and economic factors, legal claims, the Company's ability to protect intellectual property, fluctuations in exchange and interest rates, changes in taxation laws or rates, changes in legislation or accountancy practices and the Company's ability to identify, develop and successfully commercialize new products, markets or technologies.
As a result, the Company's actual performance, position and financial results and statements may differ materially from the plans, goals and expectations set forth in such forward-looking statements. The Company assumes no obligation to update any forward-looking statements or information, which should be taken as of their respective dates of issue, unless required by laws or regulations.
Pharming Group N.V.
Sijmen de Vries, CEO, Tel: +31-71-524-7400
Robin Wright, CFO, Tel: +31-71-524-7400
FTI Consulting, London, UK:
Julia Phillips/ Victoria Foster Mitchell, Tel: +44-203-727-1136
Lifespring Life Sciences Communication, Amsterdam, The Netherlands
Leon Melens, Tel: +31-6-53-81-64-27