PolyPid Secures $15 Million No
PETACH TIKVA, Israel, April 6, 2022 (GLOBE NEWSWIRE) — PolyPid Ltd. ( PYPD) (“PolyPid” or the “Company”), a late-stage biopharmaceutical company focused on improving surgical outcomes, announced today that the Company has entered into a secured loan agreement with Kreos Capital VI (Expert Fund) LP for up to $15 million US dollars (“Kreos”). Proceeds from the loan will be used to support global commercialization preparations for launch of D-PLEX100 for the prevention of abdominal soft tissue wound infections (SSIs), as well as for the advancement of PolyPid’s OncoPLEX development platform and for general corporate purposes.
“This debt facility expands our financing options and gives us access to significant additional capital on a basic basis, enhancing our ability to invest in our global commercial capabilities for D-PLEX100as well as in our development activities for our promising OncoPLEX program,” said Amir Weisberg, Chief Executive Officer of PolyPid. “Importantly, our cash runway is now extended into Q2 2023.”
“PolyPid is approaching a critical moment in its corporate development with late-stage clinical development of D-PLEX100 is progressing rapidly and the company is moving forward with its global commercial preparations,” said Sonia Benhamida, Director at Kreos. “We are excited to support PolyPid’s long-term growth initiatives with both D-PLEX100 and OncoPLEX.”
About the loan facility
The credit facility consists of three tranches of $10.0 million, $2.5 million and $2.5 million, respectively, with the first tranche being drawn upon execution of the agreement. The second tranche of US$2.5 million will be available subject to positive results from the planned open-label interim analysis of PolyPid’s ongoing Phase 3 study of D-PLEX100 for the Prevention of Abdominal Soft Tissue SSIs, SHIELD I, being conducted following the 30-day follow-up of the recently admitted 750th patient, expected in the second quarter of this year. Drawing on the third and final tranche of US$2.5 million is possible subject to positive top-line results from the SHIELD-I study or other conditions being met. The second and third tranches can be drawn until December 31, 2022.
The loan agreement provides for interest-free repayment of the first tranche until December 31, 2022, followed by 36 equal monthly payments of principal and interest. For the second and third tranches, if drawn, the Company will make interest repayments only through August 31, 2023, followed by 33 equal monthly payments of principal and interest. The senior secured loan will initially bear an interest rate of 9.25%, which may be reduced to 8.75% upon the achievement of certain milestones. The loan is repayable in full early at any time at PolyPid’s option. The loan is secured by PolyPid’s equipment and intellectual property, and the company will pay Kreos a customary fee to set up the loan. As part of the loan facility, PolyPid will issue Kreos a 7-year warrant to purchase the Company’s common shares for 8% of the amount of each tranche, if borrowed, with an exercise price of $5.135 per share. The Loan Agreement contains customary affirmative and restrictive covenants, as well as representations and warranties.
PolyPid’s lead product candidate, D-PLEX100, is a novel drug candidate designed to deliver locally sustained and controlled antibacterial activity directly to the surgical site to prevent SSIs. After administration of D-PLEX100 into the surgical site, PLEX technology enables prolonged and continuous release of the broad-spectrum antibiotic doxycycline, resulting in high local concentration of the drug for a period of four weeks to prevent SSIs, with additional potential to prevent SSIs caused by antibiotic-resistant bacteria at the site surgical site. D PLEX100 received Breakthrough Therapy Designation from the U.S. Food and Drug Administration (FDA) for the prevention of SSIs in patients undergoing elective colorectal surgery. D PLEX100 has also received two Qualified Infectious Disease Product (QIDP) awards, as well as two Fast Track awards for Prevention of Incisional Infections Post Abdominal Surgery and Prevention of Chest Wound Infections Post Cardiac Surgery.
PolyPid Ltd. (PYPD) is a late-stage biopharmaceutical company focused on improving surgical outcomes. Through locally administered, controlled, extended-release therapeutics, PolyPid’s proprietary Polymer-Lipid Encapsulation matriX (PLEX) technology combines with active pharmaceutical ingredients (APIs) to enable precise delivery of drugs at optimal release rates over periods ranging from several days to months. PolyPid’s lead product candidate D-PLEX100 is in Phase 3 clinical trials for the prevention of soft tissue infections of abdominal and sternal bones following surgical procedures. In addition, the Company is currently in the preclinical phase to test the efficacy of OncoPLEX for the treatment of solid tumors beginning with glioblastoma. More information about the company can be found at http://www.polypid.com and follow us on Twitter and LinkedIn.
Kreos Capital is the leading provider of growth finance in Europe and Israel, supporting high-growth companies at every stage of their lifecycle. Kreos targets investments across all facets of the technology and healthcare sectors and to date has committed EUR 4 billion in more than 680 portfolio company transactions in 17 countries. With currently over €1.6 billion in assets under management, Kreos can invest between €2 million and €100 million per transaction in public and private companies at all stages.
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act and other securities laws. Words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “aim,” “estimate” and similar expressions or variations of such words are intended to identify forward-looking statements. For example, the Company uses forward-looking statements when discussing the use of the proceeds from the loan and the Company’s ability to invest in global commercial capabilities for D-PLEX100 and development activities for the OncoPLEX program, the extension of the Company’s cash reserves into Q2 2023, the terms of a potential second and third tranche of the loan, and the repayment terms of each tranche. Forward-looking statements are not historical facts and are based on management’s current expectations, beliefs and projections, many of which are inherently uncertain. Such expectations, beliefs and projections are made in good faith. However, there can be no assurance that management’s expectations, beliefs and projections will be achieved and actual results may differ materially from those expressed or indicated in the forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those projected in the forward-looking statements. For a more detailed description of the risks and uncertainties affecting the Company, reference is made to the Company’s reports filed with the Securities and Exchange Commission (“SEC”) from time to time, including but not limited to those contained in the Company’s annual report on Form 20-F filed February 28, 2022. Forward-looking statements speak only as of the date on which the statements are made. The Company undertakes no obligation to update any forward-looking statements to reflect actual results, subsequent events or circumstances, changes in assumptions or changes in other factors affecting any forward-looking information except as required by applicable securities laws. If the Company updates one or more forward-looking statements, there should be no implication that the Company will make additional updates with respect thereto or with respect to any other forward-looking statements.
References and links to websites are provided as a convenience to you and the information contained on those websites is not incorporated by reference into this press release. PolyPid is not responsible for the content of third party websites.
Dikla Czaczkes Akselbrad
EVP & CFO