Navidea Biopharmaceuticals, Inc. (NYSE MKT: NAVB), today
announced that it has entered into a term loan with CRG (formerly
Capital Royalty L.P.), which provides for an initial funding of $50
million at closing. The majority of the funds provided by CRG will
be used by Navidea to retire its debt from Oxford Finance LLC in
its entirety. After repayment of the Oxford debt, this transaction
will provide a net amount of $18 million in capital to Navidea.
Proceeds will be used to support the growth of the Company’s
Manocept™ technology, initially as a state-of-the-art FDA-approved
cancer imaging agent, Lymphoseek® (technetium Tc 99m tilmanocept)
injection, and for general operating purposes.
Lymphoseek received FDA approvals in 2014 that made it the first
and only imaging agent indicated for sentinel lymph node detection
in breast cancer, melanoma and oral cavity head and neck
cancers. This provides surgeons with a tool to determine the
extent a cancer has spread in the body, which may inform accurate
staging and patient management. This is accomplished through
Lymphoseek’s distinct ability to target the cell surface protein
CD206, a marker of disease-associated macrophages.
“As a premier lender that has invested in companies across all
healthcare sectors, CRG is the ideal strategic partner for
providing us with growth capital under attractive terms. Our
relationship with CRG will allow us to execute on our Lymphoseek
commercial plan and advance our Manocept diagnostic and therapeutic
platform development programs," commented Rick Gonzalez, Navidea’s
President and Chief Executive Officer. "Importantly, this provides
us with substantially greater financial flexibility to achieve our
goal for cash flow breakeven in the first quarter of 2016 and with
the options to access additional capital or to accelerate principal
payment. In addition, CRG offers Navidea its breadth of healthcare
experience, deep knowledge of our business, and access to its
impressive network and resources."
“Navidea represents a compelling investment opportunity for CRG
with a first-in-class diagnostic imaging agent, Lymphoseek, and its
Manocept platform, which has the potential to treat cancer and
other conditions in a new way by targeting disease-associated
macrophages,” said Charles Tate, Chairman of CRG. “We believe
that Navidea is poised to become a major player in the oncology
market and CRG is pleased to provide the Company with capital as it
grows Lymphoseek revenues and advances more innovative products to
market.”
Select terms of the transaction include the following:
- Navidea will receive an initial $50
million loan with a term of six years, an interest only period for
the first four years, and a 14% annual interest rate.
- Up to $10 million of additional funding
will be available to Navidea, at its option, through December 2016,
subject to the satisfaction of certain revenue milestones and other
borrowing conditions.
- At the Company's option, during the
first four years, a portion of the interest payments may be
compounded and paid together with the principal in the fifth and
sixth years.
In connection with the CRG financing, the Company also announced
certain amendments to the Company’s existing line of credit
currently in place with Platinum-Montaur Life Sciences LLC
(Platinum) are being made that allow this facility to remain in
place in a subordinated position to the CRG loan. The amendments
will allow Platinum to convert the Company’s $7.7 million debt
during a time period in which the Company’s average stock price has
exceeded $2.53 per share for 10 consecutive trading days.
WBB Securities LLC acted as financial advisor to Navidea in
connection with this transaction.
About Lymphoseek
Lymphoseek® (technetium Tc 99m tilmanocept) injection is the
first and only FDA-approved receptor-targeted lymphatic mapping
agent. It is a novel, receptor-targeted, small-molecule
radiopharmaceutical used in the evaluation of lymphatic basins that
may have cancer involvement in patients. Lymphoseek is designed for
the precise identification of lymph nodes that drain from a primary
tumor, which have the highest probability of harboring cancer.
Lymphoseek is approved by the U.S. Food and Drug Administration
(FDA) for use in solid tumor cancers where lymphatic mapping is a
component of surgical management and for guiding sentinel lymph
node biopsy in patients with clinically node negative breast
cancer, melanoma or squamous cell carcinoma of the oral cavity.
Lymphoseek has also received European approval in imaging and
intraoperative detection of sentinel lymph nodes in patients with
melanoma, breast cancer or localized squamous cell carcinoma of the
oral cavity.
Accurate diagnostic evaluation of cancer is critical, as it
guides therapy decisions and determines patient prognosis and risk
of recurrence. Overall in the U.S., solid tumor cancers may
represent up to 1.2 million cases per year. The sentinel node label
in the U.S. and Europe may address approximately 235,000 new cases
of breast cancer, 76,000 new cases of melanoma and 45,000 new cases
of head and neck/oral cancer in the U.S., and approximately 367,000
new cases of breast cancer, 83,000 new cases of melanoma and 55,000
new cases of head and neck/oral cancer diagnosed in Europe
annually.
Lymphoseek Indication and Important Safety
Information
Lymphoseek is a radioactive diagnostic agent indicated with or
without scintigraphic imaging for:
- Lymphatic mapping using a handheld
gamma counter to locate lymph nodes draining a primary tumor site
in patients with solid tumors for which this procedure is a
component of intraoperative management.
- Guiding sentinel lymph node biopsy
using a handheld gamma counter in patients with clinically node
negative squamous cell carcinoma of the oral cavity, breast cancer
or melanoma.
Important Safety Information
In clinical trials with Lymphoseek, no serious hypersensitivity
reactions were reported, however Lymphoseek may pose a risk of such
reactions due to its chemical similarity to dextran. Serious
hypersensitivity reactions have been associated with dextran and
modified forms of dextran (such as iron dextran drugs).
Prior to the administration of Lymphoseek, patients should be
asked about previous hypersensitivity reactions to drugs, in
particular dextran and modified forms of dextran. Resuscitation
equipment and trained personnel should be available at the time of
Lymphoseek administration, and patients observed for signs or
symptoms of hypersensitivity following injection.
Any radiation-emitting product may increase the risk for cancer.
Adhere to dose recommendations and ensure safe handling to minimize
the risk for excessive radiation exposure to patients or health
care workers. In clinical trials, no patients experienced serious
adverse reactions and the most common adverse reactions were
injection site irritation and/or pain (<1%).
FULL LYMPHOSEEK PRESCRIBING INFORMATION CAN BE FOUND
AT:WWW.LYMPHOSEEK.COM
About Navidea Biopharmaceuticals Inc.
Navidea Biopharmaceuticals, Inc. (NYSE MKT: NAVB) is a
biopharmaceutical company focused on the development and
commercialization of precision diagnostics, therapeutics and
radiopharmaceutical agents. Navidea is developing multiple
precision-targeted products and platforms including Manocept™ and
NAV4694 to help identify the sites and pathways of undetected
disease and enable better diagnostic accuracy, clinical
decision-making, targeted treatment and, ultimately, patient care.
Lymphoseek® (technetium Tc 99m tilmanocept) injection, Navidea’s
first commercial product from the Manocept platform, was approved
by the FDA in March 2013 and in Europe in November 2014. Navidea’s
strategy is to deliver superior growth and shareholder return by
bringing to market novel radiopharmaceutical agents and
therapeutics, and advancing the Company’s pipeline through global
partnering and commercialization efforts. For more information,
please visit www.navidea.com.
About CRG
Founded in 2003, CRG (previously known as Capital Royalty L.P.)
is a healthcare-focused investment firm with over $2 billion of
assets under management that provides capital to healthcare
companies primarily through structured debt and senior secured
loans. CRG works across the spectrum of life science products and
technologies and targets investment sizes ranging between $20
million and $200 million. The firm partners with commercial-stage
healthcare companies to provide flexible financing solutions so
they can achieve their growth objectives. CRG is headquartered in
Houston, Texas with offices in Boulder, Colorado and New York City.
For additional information, please visit www.crglp.com.
The Private Securities Litigation Reform Act of 1995 (the Act)
provides a safe harbor for forward-looking statements made by or on
behalf of the Company. Statements in this news release, which
relate to other than strictly historical facts, such as statements
about the Company’s plans and strategies, expectations for future
financial performance, new and existing products and technologies,
anticipated clinical and regulatory pathways, and markets for the
Company’s products are forward-looking statements within the
meaning of the Act. The words “believe,” “expect,” “anticipate,”
“estimate,” “project,” and similar expressions identify
forward-looking statements that speak only as of the date hereof.
Investors are cautioned that such statements involve risks and
uncertainties that could cause actual results to differ materially
from historical or anticipated results due to many factors
including, but not limited to, the Company’s continuing operating
losses, uncertainty of market acceptance of its products, reliance
on third party manufacturers, accumulated deficit, future capital
needs, uncertainty of capital funding, dependence on limited
product line and distribution channels, competition, limited
marketing and manufacturing experience, risks of development of new
products, regulatory risks and other risks detailed in the
Company’s most recent Annual Report on Form 10-K and other
Securities and Exchange Commission filings. The Company undertakes
no obligation to publicly update or revise any forward-looking
statements.
Navidea BiopharmaceuticalsInvestorsTom Baker,
617-532-0624tbaker@navidea.comorMediaSharon Correia, 978-655-2686Associate
Director, Corporate CommunicationsorCRGLuke Düster,
713-209-7361Managing Directorlduster@crglp.com
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