On April 18, 2023 TME Pharma N.V. (Euronext Growth Paris: ALTME) (Paris:ALTME), a biotechnology company focused on developing novel therapies for treatment of cancer by targeting the tumor microenvironment (TME), reported the successful closing of a financing of €2 million (Press release, TME Pharma, APR 18, 2023, View Source [SID1234630291]). The financing extends the company’s cash runway into December 2023, sufficient to reach its next major inflection points and to allow further advance its ongoing GLORIA Phase 1/2 clinical study of NOX-A12 combination therapies in newly diagnosed brain cancer (glioblastoma) patients.
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The transaction involves: 1) a €1 million equity financing at the price of €1.04161 per share from a group of new investors, 2) a drawdown of €1.08 million under agreement with Atlas Special Opportunities, LLC (ASO) by issuing 1,100 convertible bonds, 3) the conversion of €2 million (~48%) outstanding convertible bonds held by ASO into newly issued shares at a conversion price of €1.04161 per share, 4) a soft lock-up of all shares issued through this transaction for a 6-month period, and 5) a lock-up of all remaining convertible bonds for a 6-month period.
Moreover, the company will not draw any further tranches from the ASO convertible bond vehicle and the agreement with ASO is terminated other than with regard to already issued convertible bonds. TME Pharma is also studying options to be able to repurchase the remaining convertible bonds, as allowed under the agreement, to prevent conversion to shares.
"We are very pleased to announce the details of a successful transaction concluded with a group of new investors and Atlas, which extends our cash runway into December 2023," said Aram Mangasarian, CEO of TME Pharma. "This innovatively-structured transaction represents the first step in the commitment we made to our shareholders to end reliance of the company on convertible bond financing. By removing the pressure of convertible bonds, we hope our exceptional therapeutic assets will be able to reach a valuation on the market that reflects their therapeutic potential. We estimate the addressable market for first line glioblastoma to be $2.5 billion per year. We would like to thank Atlas for their support in facilitating the transaction and welcome our new investors who showed their confidence in TME Pharma through this latest financing. This will enable us to maintain our focus on our goal of developing novel therapies for cancer patients and bringing them to market."
The convertible bond agreement with ASO was initially entered on April 23, 2020, and amended on October 14, 2020, December 29, 2021, May 19, 2022, and April 17, 2023.
The characteristics, terms and conditions and dilution resulting from the transaction may be found in the Annex to this press release.