Phathom Pharmaceuticals Announces Placement of the Remaining $40 Million in Non-Dilutive Capital under its up to $300 Million Revenue Interest Financing Agreement

Phathom Pharmaceuticals (NASDAQ: PHAT) has secured an additional $40 million in non-dilutive financing, increasing total available financing to $300 million.

Rhea-AI Summary

Phathom Pharmaceuticals (NASDAQ: PHAT) has secured an additional $40 million in non-dilutive financing, increasing total available financing to $300 million. This funding includes $15 million contingent upon FDA approval for vonoprazan in treating erosive esophagitis and $25 million linked to sales milestones. Investors will receive a 10% royalty on net sales, capped at 2.0x of total payments received. This agreement involves Sagard Healthcare Partners, NovaQuest Capital Management, and Hercules Capital.

Positive

• Secured an additional $40 million in non-dilutive financing, raising total financing to $300 million.
• Funding includes $15 million upon FDA approval of vonoprazan for erosive esophagitis.
• Potential $25 million milestone funding based on sales achievements.

Negative

• None.

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• Up to $40 million committed, resulting in total financing of up to $300 million available to Phathom with total royalty payments capped at 2.0x invested capital

• Provides agreement for additional $15 million upon FDA approval of vonoprazan for treatment of erosive esophagitis (EE) and $25 million for achievement of a sales milestone
  

FLORHAM PARK, N.J., Nov. 01, 2022 (GLOBE NEWSWIRE) -- Phathom Pharmaceuticals, Inc. (Nasdaq: PHAT), a biopharmaceutical company focused on developing and commercializing novel treatments for gastrointestinal diseases and disorders, today announced that up to an additional $40 million in non-dilutive capital has been secured from an additional investor under the terms of Phathom’s revenue interest financing agreement announced on May 4, 2022.

Up to $40 million has been committed, comprised of $15 million upon FDA approval of vonoprazan for treatment of EE, and $25 million upon achievement of a sales milestone. This additional potential funding is subject to the revenue interest financing agreement with Sagard Healthcare Partners, NovaQuest Capital Management, and Hercules Capital, Inc. (NYSE: HTGC) which provided Phathom with the option to add additional investors for up to $40 million in additional funding. This additional $40 million in potential funding increases the total financing available to Phathom under the agreement to up to $300 million.

In exchange for the commitment to provide these cash payments, the investors will receive a 10% royalty on Phathom’s net sales of products containing vonoprazan. The royalty payment will be reduced to 1% on incremental net sales that exceed certain annual thresholds following regulatory approval of vonoprazan for symptomatic non-erosive reflux disease (NERD). The total royalties payable by Phathom to the investors are capped at 2.0x of the total payments received from the investors. Upon achievement of the cap amount, the agreement will terminate.

Morgan Stanley & Co. LLC acted as sole structuring agent on the transaction.

About Phathom Pharmaceuticals, Inc.
Phathom Pharmaceuticals is a biopharmaceutical company focused on the development and commercialization of novel treatments for gastrointestinal diseases and disorders. Phathom has in-licensed the exclusive rights in the United States, Europe, and Canada to vonoprazan, a first-in-class potassium-competitive acid blocker (PCAB). Vonoprazan-based regimens are approved in the U.S. as part of a co-packaged product in combination with antibiotics for the treatment of H. pylori infection in adults, marketed as VOQUEZNA™ TRIPLE PAK™ (vonoprazan, amoxicillin, clarithromycin) and VOQUEZNA™ DUAL PAK™ (vonoprazan, amoxicillin). Phathom has a New Drug Application under review by the FDA for vonoprazan in erosive esophagitis (EE) and is studying the use of vonoprazan for the treatment of non-erosive reflux disease (NERD). For more information about Phathom, visit the Company’s website at www.phathompharma.com and follow the Company on LinkedIn and Twitter.

CONTACTS

Media and Investor Contact:
Nick Benedetto
1-877-742-8466
media@phathompharma.com
ir@phathompharma.com

© 2022 Phathom Pharmaceuticals. All rights reserved.
VOQUEZNA, VOQUEZNA TRIPLE PAK, VOQUEZNA DUAL PAK, Phathom Pharmaceuticals, and their respective logos are registered trademarks or trademarks of Phathom Pharmaceuticals, Inc.

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What recent financing did Phathom Pharmaceuticals secure?

Phathom Pharmaceuticals secured an additional $40 million in non-dilutive financing, increasing their total financing to $300 million.

What are the conditions for the new $40 million funding for Phathom?

The funding includes $15 million upon FDA approval of vonoprazan for erosive esophagitis and $25 million for achieving sales milestones.

How much royalty will investors receive from Phathom's sales?

Investors will receive a 10% royalty on net sales of products containing vonoprazan, capped at 2.0x the total payments received.

Which investors are involved in Phathom's financing agreement?

The agreement includes Sagard Healthcare Partners, NovaQuest Capital Management, and Hercules Capital.