Scilex Holding Company Announces Repayment in Full of the Remaining Balance of Convertible Debentures and Early Payment of the Senior Secured Promissory Note, Paving the Way for Future Growth and Innovation

Rhea-AI Summary

Scilex Holding Company (SCLX) announced paying off $1.3 million in convertible debentures and $15 million in a promissory note, signaling financial strength and readiness for growth. The company aims to develop non-opioid pain management products, expand commercialization efforts, and address the opioid crisis.

Insights

Financial Analyst

Scilex's recent payoff of its convertible debentures and early payment on the senior secured promissory note indicates a strategic move to strengthen its financial structure. This action suggests a positive cash flow situation, which is often attractive to investors as it may imply operational efficiency and financial prudence. By eliminating these debts, Scilex potentially reduces future interest expenses and dilution risk associated with the Convertible Debentures, enhancing shareholder value.

The early payoff also signals to the market that Scilex is confident in its liquidity and cash reserves. This can be interpreted as a green flag for financial health and may lead to an improved credit rating, which in turn could lower the cost of capital for future borrowings. For a company in the pharmaceutical sector, where cash flow is critical for funding ongoing research and development, this move could provide more flexibility for strategic initiatives without the pressure of impending debt repayments.

Market Research Analyst

Scilex's focus on non-opioid pain management products is particularly pertinent given the current opioid crisis. There is a growing market demand for such treatments and by paying off debts, Scilex may be positioning itself to capitalize on this demand more effectively. This strategic debt reduction could enable the company to allocate more resources towards the expansion of its product portfolio and commercialization efforts, potentially leading to increased market share.

Furthermore, the emphasis on strengthening the balance sheet and readiness to pursue collaborations could indicate potential partnerships or acquisitions in the pipeline. Such strategic moves could be a catalyst for growth, as they may allow Scilex to enhance its product offerings and leverage synergies with other entities in the pain management space. Stakeholders should monitor how these developments align with industry trends and the company's long-term growth strategy.

Healthcare Industry Analyst

Scilex's early repayment of debt is a significant move within the context of the healthcare industry. It suggests that the company is not only managing its current obligations well but is also preparing for future growth opportunities. In the pharmaceutical industry, the ability to quickly respond to market changes and regulatory environments is essential. By improving its financial flexibility, Scilex may be better equipped to navigate the complex approval processes for new drugs and to invest in innovative research and development.

The mention of 'transforming the lives of patients' underscores the company's commitment to addressing a critical public health issue. The impact of such a mission-driven approach can resonate with both consumers and investors, potentially leading to enhanced brand loyalty and investor confidence. It will be important to observe how Scilex leverages its improved financial position to advance its pipeline and address the unmet needs in pain management.

PALO ALTO, Calif., March 19, 2024 (GLOBE NEWSWIRE) -- Scilex Holding Company (Nasdaq: SCLX, “Scilex”), an innovative revenue-generating company focused on acquiring, developing and commercializing non-opioid pain management products for the treatment of acute and chronic pain, today announced that it has paid off the remaining balance of approx. $1,300,000 under the convertible debentures (the “Convertible Debentures”) previously issued and sold to YA II PN, Ltd. (“Yorkville”) in March 2023.   

Scilex has also voluntarily made an early payment in the aggregate amount of $15,000,000 under the senior secured promissory note (the “Oramed Note”) issued to Oramed Pharmaceuticals Inc. (Nasdaq: ORMP, “Oramed”) in September 2023.

“This is a pivotal moment for Scilex, signaling our readiness to embrace new opportunities and transform the lives of patients with acute and chronic pain while addressing the opioid crisis. With a stronger balance sheet, we are well-positioned to pursue collaborations, expand our current commercialization efforts, and bring additional innovative opioid sparing treatments to market,” said Jaisim Shah, Chief Executive Officer and President of Scilex.

For more information on Scilex Holding Company, refer to www.scilexholding.com.

For more information on ZTlido® including Full Prescribing Information, refer to www.ztlido.com.

For more information on ELYXYB®, including Full Prescribing Information, refer to www.elyxyb.com.

For more information on Gloperba®, including Full Prescribing Information, refer to www.gloperba.com.

Facebook: https://www.facebook.com/scilex.pharm

LinkedIn: https://www.linkedin.com/company/scilex-holding-company

Email: info@scilexholding.com

About Scilex Holding Company

Scilex Holding Company is an innovative revenue-generating company focused on acquiring, developing and commercializing non-opioid pain management products for the treatment of acute and chronic pain. Scilex targets indications with high unmet needs and large market opportunities with non-opioid therapies for the treatment of patients with acute and chronic pain and are dedicated to advancing and improving patient outcomes. Scilex’s commercial products include: (i) ZTlido® (lidocaine topical system) 1.8%, a prescription lidocaine topical product approved by the U.S. Food and Drug Administration (the “FDA”) for the relief of neuropathic pain associated with postherpetic neuralgia, which is a form of post-shingles nerve pain; (ii) ELYXYB®, a potential first-line treatment and the only FDA-approved, ready-to-use oral solution for the acute treatment of migraine, with or without aura, in adults; and (iii) Gloperba®, the first and only liquid oral version of the anti-gout medicine colchicine indicated for the prophylaxis of painful gout flares in adults, expected to launch in the first half of 2024.

In addition, Scilex has three product candidates: (i) SP-102 (10 mg, dexamethasone sodium phosphate viscous gel) (“SEMDEXA™” or “SP-102”), a novel, viscous gel formulation of a widely used corticosteroid for epidural injections to treat lumbosacral radicular pain, or sciatica for which Scilex has completed a Phase 3 study and has granted Fast Track status from the FDA in 2017; (ii) SP-103 (lidocaine topical system) 5.4%, (“SP-103”), a next-generation, triple-strength formulation of ZTlido, for the treatment of chronic neck pain and for which Scilex has recently completed a Phase 2 trial in low back pain. SP-103 has granted Fast Track status from the FDA in low back pain; and (iii) SP-104 (4.5 mg, low-dose naltrexone hydrochloride delayed-release capsules) (“SP-104”), a novel low-dose delayed-release naltrexone hydrochloride being developed for the treatment of fibromyalgia, for which Phase 1 trials were completed in the second quarter of 2022 and a Phase 2 clinical trial is expected to commence in 2024.

Scilex Holding Company is headquartered in Palo Alto, California.

Forward-Looking Statements

This press release and any statements made for and during any presentation or meeting concerning the matters discussed in this press release contain forward-looking statements related to Scilex and its subsidiaries under the safe harbor provisions of Section 21E of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Forward-looking statements include statements regarding Scilex’s ability to repay the remaining balance of the Oramed Note, Scilex’s belief that it is well-positioned to pursue collaborations, expand commercialization efforts and bring additional innovative products to market, Scilex’s expectation to launch Gloperba® in the first half of 2024 and plans to initiate a Phase 2 clinical trial in 2024 for SP-104.  

Risks and uncertainties that could cause Scilex’s actual results to differ materially and adversely from those expressed in our forward-looking statements, include, but are not limited to: risks associated with the unpredictability of trading markets and whether a market will be established for Scilex’s common stock; general economic, political and business conditions; risks related to COVID-19 (and other similar disruptions); the risk that the potential product candidates that Scilex develops may not progress through clinical development or receive required regulatory approvals within expected timelines or at all; risks relating to uncertainty regarding the regulatory pathway for Scilex’s product candidates; the risk that Scilex will be unable to successfully market or gain market acceptance of its product candidates; the risk that Scilex’s product candidates may not be beneficial to patients or successfully commercialized; the risk that Scilex has overestimated the size of the target patient population, their willingness to try new therapies and the willingness of physicians to prescribe these therapies; risks that the outcome of the trials and studies for SP-102, SP-103 or SP-104 may not be successful or reflect positive outcomes; risks that the prior results of the clinical and investigator-initiated trials of SP-102 (SEMDEXA™), SP-103 or SP-104 may not be replicated; regulatory and intellectual property risks; and other risks and uncertainties indicated from time to time and other risks described in Scilex’s most recent periodic reports filed with the Securities and Exchange Commission, including Scilex’s Annual Report on Form 10-K for the year ended December 31, 2023, including the risk factors set forth in those filings. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release, and Scilex undertakes no obligation to update any forward-looking statement in this press release except as may be required by law.

Contacts:

Investors and Media
Scilex Holding Company
960 San Antonio Road
Palo Alto, CA 94303
Office: (650) 516-4310

Email: investorrelations@scilexholding.com

Website: www.scilexholding.com

SEMDEXA™ (SP-102) is a trademark owned by Semnur Pharmaceuticals, Inc., a wholly-owned subsidiary of Scilex Holding Company. A proprietary name review by the FDA is planned.

ZTlido® is a registered trademark owned by Scilex Pharmaceuticals Inc., a wholly-owned subsidiary of Scilex Holding Company.

Gloperba® is the subject of an exclusive, transferable license to use the registered trademark by Scilex Holding Company.

ELYXYB® is a registered trademark owned by Scilex Holding Company.

All other trademarks are the property of their respective owners.

© 2024 Scilex Holding Company All Rights Reserved.

FAQ

What is the ticker symbol for Scilex Holding Company?

The ticker symbol for Scilex Holding Company is SCLX.

What amount did Scilex pay off under the convertible debentures?

Scilex paid off the remaining balance of approximately $1,300,000 under the convertible debentures.

Who were the convertible debentures previously issued and sold to?

The convertible debentures were previously issued and sold to YA II PN, (Yorkville).

What amount did Scilex voluntarily pay under the senior secured promissory note?

Scilex voluntarily made an early payment of $15,000,000 under the senior secured promissory note issued to Oramed Pharmaceuticals Inc.

What is the website for more information on Scilex Holding Company?

For more information on Scilex Holding Company, refer to www.scilexholding.com.