Liquidia Corporation Secures $20.5 Million Debt Facility with Silicon Valley Bank

Rhea-AI Summary

Liquidia Corporation (NASDAQ: LQDA) announced the closing of a debt facility with Silicon Valley Bank, providing up to $20.5 million in loans. The initial tranche of $10.5 million has been funded and used to retire existing debt, adding $1 million to Liquidia’s balance sheet. The second tranche of $5 million is contingent on FDA tentative approval for LIQ861 by June 30, 2022, and the final tranche is available upon full approval by December 31, 2022. The facility matures on September 1, 2024, with interest-only payments through March 31, 2023.

Positive

• Secured a $20.5 million debt facility, enhancing liquidity.
• Initial funding of $10.5 million improves balance sheet by $1 million.
• Non-dilutive capital from second and third tranches supports LIQ861 commercialization.

Negative

• Dependence on FDA approval for second and third tranches could pose financial risk.
• Initial debt repayment may indicate previous cash flow challenges.

RESEARCH TRIANGLE PARK, N.C., March 02, 2021 (GLOBE NEWSWIRE) -- Liquidia Corporation (NASDAQ: LQDA) today announced the closing of a debt facility on February 26, 2021, with Silicon Valley Bank, which provides Liquidia with up to $20.5 million in term loans of which the first $10.5 million was funded at closing.

Under the terms of the debt facility, Silicon Valley Bank will make loans available in three tranches. Proceeds from the first tranche of $10.5 million have been used to retire Liquidia’s existing term debt with Pacific Western Bank and adds approximately $1.0 million to Liquidia’s balance sheet. A second tranche of $5.0 million is available upon the Food and Drug Administration (FDA) granting Liquidia tentative approval for LIQ861 by June 30, 2022, and the third tranche of $5.0 million is available upon receipt of final and unconditional approval for LIQ861 by December 31, 2022. The debt facility will mature on September 1, 2024 and will consist of interest-only payments through March 31, 2023.

Michael Kaseta, Chief Financial Officer of Liquidia, said: “We are very pleased to secure this debt facility and to work with Silicon Valley Bank, a great partner who can continue to grow with us. The interest-only payments on the first tranche will reduce our cash outlay by $5.5 million in 2021 and $4.5 million in 2022. The additional tranches of debt provide non-dilutive capital at key moments through the course of 2022 as we prepare for LIQ861 commercialization.”

"Liquidia is driving important advancements in the pharmaceutical industry through its innovative PRINT technology," said Scott McCarty, Director of Life Science and Healthcare at Silicon Valley Bank. "We are proud to support the Liquidia team with this debt facility as the company advances the development and commercialization of LIQ861 and the Treprostinil Injection."

About Liquidia Corporation
Liquidia Corporation operates through the company’s subsidiaries, Liquidia Technologies, Inc. and Liquidia PAH, LLC. The Company, through Liquidia Technologies, Inc., is a biopharmaceutical company focused on the development and commercialization of products in pulmonary arterial hypertension and other applications of its PRINT technology. Liquidia is developing two product candidates: LIQ861, an inhaled dry powder formulation of treprostinil for the treatment of pulmonary arterial hypertension (PAH), and LIQ865, an injectable, sustained-release formulation of bupivacaine for the management of local post-operative pain for three to five days after a procedure. Liquidia PAH, LLC provides commercialization for rare disease pharmaceutical products, such as Treprostinil Injection, Sandoz Inc.’s first-to-file, generic treprostinil for PAH.

Liquidia Corporation is headquartered in Research Triangle Park, NC. For more information, please visit www.liquidia.com.

About Silicon Valley Bank
For more than 35 years, Silicon Valley Bank (SVB) has helped innovative companies and their investors move bold ideas forward, fast. SVB provides targeted financial services and expertise through its offices in innovation centers around the world. With commercial, international and private banking services, SVB helps address the unique needs of innovators. Learn more at svb.com.

Contact Information

Media & Investors:
Jason Adair
Vice President, Corporate Development and Strategy
919.328.4400
jason.adair@liquidia.com

FAQ

What is Liquidia Corporation's recent debt facility announcement related to LQDA?

Liquidia announced a debt facility with Silicon Valley Bank, providing up to $20.5 million to support operations and commercialization efforts for LIQ861.

How much of the debt facility was funded for LQDA?

The first tranche of $10.5 million was funded immediately, aimed at debt repayment and improving liquidity.

What are the conditions for the subsequent tranches of the debt facility for LQDA?

The second tranche of $5 million is available upon FDA tentative approval for LIQ861 by June 30, 2022, and the third tranche upon full approval by December 31, 2022.

When will the debt facility for LQDA mature?

The debt facility will mature on September 1, 2024, with interest-only payments required until March 31, 2023.