Liquidia Corporation Announces $100 Million in New Financings
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Liquidia Corporation's recent capital raise through a private placement and an amendment to its Revenue Interest Financing Agreement (RIFA) with HealthCare Royalty indicates a strategic move to strengthen its financial position. The $75 million from Patient Square Capital and the additional $25 million from HCRx provide a significant influx of capital, which is crucial for the company's operations and future growth.
From a financial perspective, the transaction terms are notable. The 8% discount on the private placement price per share compared to the previous closing market price suggests a willingness by Liquidia to secure capital at the cost of immediate shareholder dilution. However, this approach can be advantageous if the funds are used effectively to drive the company towards profitability. Moreover, the absence of broker fees in the private placement transaction indicates cost savings and a direct relationship with the investor.
The amendment to the RIFA, allowing for an advance of funds, is a strategic financial instrument that provides Liquidia with non-dilutive capital. This means that the company can secure funding without further diluting existing shareholders' equity. The tiered royalty payment structure upon commercial success of their product, YUTREPIA, aligns HCRx's return with the company's revenue performance, which can be beneficial for both parties if the product succeeds in the market.
Overall, these transactions signify investor confidence in Liquidia's potential to become profitable, particularly with the anticipated launch of YUTREPIA. Such capital infusions are critical for biotech companies, which often face significant R&D expenses and regulatory hurdles before generating revenue.
The investment in Liquidia Corporation is closely tied to the development and potential commercialization of YUTREPIA, which is aimed at treating conditions such as pulmonary arterial hypertension (PAH) and pulmonary hypertension associated with interstitial lung disease (PH-ILD). These are serious conditions for which there is a continuous search for better treatments.
YUTREPIA's (treprostinil inhalation powder) value proposition lies in its potential to offer new treatment options for patients with PAH and PH-ILD. If the product can demonstrate improved outcomes, ease of use, or cost-effectiveness compared to existing therapies, it could capture a significant share of the market. The additional capital raised by Liquidia is likely allocated towards the final stages of development, regulatory activities and preparation for a successful product launch.
The company's ability to secure capital also suggests investor confidence in the outcome of ongoing litigation and the overall strategy. Litigation outcomes can have profound effects on a biotech company's intellectual property and market exclusivity, which in turn can impact the commercial success of its products. Therefore, the resolution of such legal matters is a critical factor for potential investors and partners.
The pharmaceutical market for PAH and PH-ILD treatments is competitive and highly regulated. Liquidia's funding announcement indicates it is preparing for an aggressive market entry strategy with YUTREPIA. The company's financial positioning, through the recent capital raises, suggests that it is bolstering its resources to ensure a robust market presence upon product launch.
Understanding the market dynamics, including competitor products, pricing strategies and reimbursement policies, is essential for Liquidia's success. The company's increased fixed payments to HCRx as consideration for the advanced capital could impact its financial flexibility in the short term. However, the tiered royalty arrangement allows for a more variable cost structure that adapts to the product's revenue performance, which could be advantageous in managing financial risk in the volatile pharmaceutical market.
Furthermore, the confidence displayed by Patient Square Capital and HCRx in Liquidia's strategy and product pipeline could potentially attract further investments or partnerships. Positive investor sentiment often leads to increased stock market interest, which can be beneficial for a company's valuation and its ability to raise additional funds in the future if necessary.
- Agreed to
$75.0 million sale of common stock to fund affiliated with Patient Square Capital in a private placement - Additional advance of
$25.0 million from HealthCare Royalty under current financing agreement
MORRISVILLE, N.C., Jan. 04, 2024 (GLOBE NEWSWIRE) -- Liquidia Corporation (NASDAQ: LQDA) (Liquidia or the Company) announced today that the Company has entered into agreements for an additional
On January 4, 2024, Liquidia and an affiliate of Patient Square Capital entered into a common stock purchase agreement for the private placement of 7,182,532 shares of common stock at a purchase price of
On January 3, 2024, HCRx and Liquidia entered a fourth amendment to the Revenue Interest Financing Agreement (RIFA) to fund an additional
Michael Kaseta, Chief Financial Officer of Liquidia, stated: “With these financings, we are well positioned to achieve our corporate objectives in 2024 and could bridge the Company to profitability if YUTREPIA is able to launch by April. We believe that the investments by Patient Square Capital and HCRx signal the increasing confidence in our strategy, the outcomes of on-going litigation, and more importantly, the value of YUTREPIA to the medical community who are seeking new choices to treat patients diagnosed with pulmonary arterial hypertension (PAH) and pulmonary hypertension associated with interstitial lung disease (PH-ILD).”
In the last month, Liquidia has secured a total of
About Patient Square Capital
Patient Square Capital is a dedicated health care investment firm with more than
About HealthCare Royalty
HCRx is a leading royalty acquisition company focused on commercial or near-commercial stage biopharmaceutical products. HCRx has invested
About YUTREPIA™(treprostinil) inhalation powder
YUTREPIA is an investigational, inhaled dry powder formulation of treprostinil delivered through a convenient, low-resistance, palm-sized device. On November 5, 2021, the FDA issued a tentative approval for YUTREPIA for the treatment of PAH to improve exercise ability in adult patients with New York Heart Association (NYHA) Functional Class II-III symptoms. In July 2023, Liquidia filed an amendment to its New Drug Application for YUTREPIA, seeking to add PH-ILD to the label. The FDA has set a Prescription Drug User Fee Act (PDUFA) goal date of January 24, 2024 for the amendment. Previously, the FDA has confirmed that YUTREPIA may add the treatment of PH-ILD to the label for YUTREPIA without additional clinical studies. YUTREPIA was designed using Liquidia’s PRINT® technology, which enables the development of drug particles that are precise and uniform in size, shape, and composition, and that are engineered for enhanced deposition in the lung following oral inhalation. Liquidia has completed INSPIRE, or Investigation of the Safety and Pharmacology of Dry Powder Inhalation of Treprostinil, an open-label, multi-center phase 3 clinical study of YUTREPIA in patients diagnosed with PAH who are naïve to inhaled treprostinil or who are transitioning from Tyvaso® (nebulized treprostinil). YUTREPIA was previously referred to as LIQ861 in investigational studies.
About pulmonary arterial hypertension (PAH)
Pulmonary arterial hypertension (PAH) is a rare, chronic, progressive disease caused by hardening and narrowing of the pulmonary arteries that can lead to right heart failure and eventually death. Currently, an estimated 45,000 patients are diagnosed and treated in the United States. There is currently no cure for PAH, so the goals of existing treatments are to alleviate symptoms, maintain or improve functional class, delay disease progression, and improve quality of life.
About pulmonary hypertension associated with interstitial lung disease (PH-ILD)
Pulmonary hypertension (PH) associated with interstitial lung disease (ILD) includes a diverse collection of up to 150 different pulmonary diseases, including interstitial pulmonary fibrosis, chronic hypersensitivity pneumonitis, connective tissue disease related ILD, and chronic pulmonary fibrosis with emphysema (CPFE) among others. Any level of PH in ILD patients is associated with poor 3-year survival. A current estimate of PH-ILD prevalence in the United States is greater than 60,000 patients, though population growth in many of these underlying ILD diseases is not yet known due to factors including underdiagnosis and lack of approved treatments until March 2021, when inhaled treprostinil was first approved for this indication.
About Liquidia Corporation
Liquidia Corporation is a biopharmaceutical company focused on the development and commercialization of products in pulmonary hypertension and other applications of its PRINT® Technology. The Company operates through its two wholly owned subsidiaries, Liquidia Technologies, Inc. and Liquidia PAH, LLC. Liquidia Technologies has developed YUTREPIA™ (treprostinil) inhalation powder for the treatment of pulmonary arterial hypertension (PAH) and pulmonary hypertension associated with interstitial lung disease (PH-ILD). Liquidia Technologies is also developing L606, an investigational liposomal formulation of treprostinil administered twice-daily with a short-duration next-generation nebulizer, for use in North America. Liquidia PAH provides the commercialization for pharmaceutical products to treat pulmonary disease, such as generic Treprostinil Injection. For more information, please visit www.liquidia.com.
Tyvaso® and Tyvaso DPI® are registered trademarks of United Therapeutics Corporation.
Cautionary Statements Regarding Forward-Looking Statements
This press release may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical facts, including statements regarding our future results of operations and financial position, our strategic and financial initiatives, our business strategy and plans and our objectives for future operations, are forward-looking statements. Such forward-looking statements, including statements regarding clinical trials, clinical studies and other clinical work (including the funding therefor, anticipated patient enrollment, safety data, study data, trial outcomes, timing or associated costs), regulatory applications and related submission contents and timelines, including the potential for final FDA approval of the NDA for YUTREPIA, the timeline or outcome related to patent litigation in the U.S. District Court for the District of Delaware or inter partes review proceedings conducted at the PTAB, including appeals of decisions in any such proceedings, the issuance of patents by the USPTO and our ability to execute on our strategic or financial initiatives, involve significant risks and uncertainties and actual results could differ materially from those expressed or implied herein. The favorable decisions of lower tribunals are not determinative of the outcome of the appeals of the decisions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “would,” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs. These forward-looking statements are subject to a number of risks discussed in our filings with the SEC, including the impact of the coronavirus (COVID-19) outbreak on our Company and our financial condition and results of operations, as well as a number of uncertainties and assumptions. Moreover, we operate in a very competitive and rapidly changing environment and our industry has inherent risks. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events discussed in this press release may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Nothing in this press release should be regarded as a representation by any person that these goals will be achieved, and we undertake no duty to update our goals or to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.
Contact Information
Media & Investors:
Jason Adair
Chief Business Officer
919.328.4400
jason.adair@liquidia.com
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