|ARYx secures important bridge financing|
|By Staff and Wire Reports|
|Monday, 16 August 2010 09:22|
We have an update to our profile for the small-cap biotech with 3 mid-stage drugs that will be ready for Phase 3 trials in the coming months. As we told you, ARYx had explored the possibility of capturing full near-term value for its three lead programs rather than pursuing licensing deals, but things may be changing and this news could be good for investors.ARYx Therapeutics, Inc. (NASDAQ:ARYX) today announced that it has secured bridge financing to allow ARYx time and resources to potentially complete a transaction that could create significant value for stockholders. ARYx also released its financial results for the second quarter of 2010.
The bridge financing comes from two related loan transactions. The first is a bridge loan financing of up to $4 million from two existing investors, including entities affiliated with MPM Capital (the “Bridge Loan”). The closing of the initial tranche of $2.0 million of the Bridge Loan closed on August 13, 2010. Concurrent with the initial tranche closing of the Bridge Loan, ARYx also amended its existing loan agreement with Lighthouse Capital Partners V, L.P. (“Lighthouse”). The amendment of the Lighthouse loan allows approximately $2.3 million of required payments to Lighthouse to be deferred and extended as a new loan commitment to ARYx. Based on previously disclosed projections and supported by the financial results released today, ARYx believes the proceeds and anticipated proceeds from these financings, totaling up to $6.3 million, should allow ARYx to operate through the end of 2010.
“The securing of this bridge financing is significant to ARYx since it now gives us the time to complete a strategic transaction that, if finalized, could realize real value from our product portfolio. The participation of our existing investors in the bridge loan financing follows their conducting significant due diligence on the company and our progress to date towards a potential transaction. Therefore, we believe this financing is a vote of confidence by important current investors,” said Dr. Paul Goddard, ARYx chairman and chief executive officer. “We also believe that the additional participation by Lighthouse further strengthens our ability to complete the on-going strategic process,” concluded Dr. Goddard.
Read our original report about the company here.