Amicus received a bunch of good news last month when analysts threw cold water on Sanofi’s late-onset Pompe disease ERT, after a Phase III study essentially paved the way for the competitor candidate for Amicus to be the flag bearer. Today, Amicus is gearing up for a new “path to profitability” with an expected windfall.
New Jersey biopharma today announced it has refinanced its debt to the tune of a $ 400 million loan from Hayfin Capital Management. Amicus will use the credit, which is expected to be fully funded on or around August 4, to refinance existing debt and for other development purposes.
As part of the announcement, Amicus also noted that it remains on track to generate between $ 250 million and $ 260 million in revenue from sales of its drug Galafold, which treats Fabry disease.
Basically for Amicus, the loan allows the payment of current obligations without resorting to the stock market and without diluting its stake. In other words, Amicus did not have to sell shares to subsidize the debt payment.
Amicus will only have to pay interest until mid-2024. Then, starting on the fourth anniversary of the loan withdrawal, the company will repay the principal amount in nine equal quarterly installments until the loan matures in late 2026, according to an SEC filing. Amicus can also reimburse the entire capital at any time.
The mere fact that Hayfin is willing to provide such a large line of credit illustrates the company’s confidence in Amicus’ ability not only to repay in full, but in the future candidate for Pompe disease himself. Since the publication of the Sanofi study last month, Amicus stock has risen by around 40%.
This study showed disappointing data for Sanofi’s neo-GAA program in the treatment of Pompe disease compared to Lumizyme, a previous generation ERT from Sanofi. Although neo-GAA met its primary endpoint of non-inferiority, it did not demonstrate superiority, a Cowen analyst said at the time.
Additionally, a crossover trial comparison of SVB Leerink indicated that Sanofi’s Phase III results showed less efficacy than Amicus’ Phase II results. Amicus is currently conducting its Phase III trial for its candidate for Pompe disease, AT-GAA, and plans to request and complete an ongoing BLA in the first half of next year.
Completion of Phase III of Amicus could provide final and definitive proof that its candidate will establish the market for Pompe disease drugs, if all goes well. But nothing has, for the moment, suggested the contrary.