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Achaogen Declares Chapter 11 with $25MM Financing Commitment from Silicon Valley Bank

April 16, 2019, 09:00 AM
Filed Under: Pharmaceuticals

Achaogen, Inc., a biopharmaceutical company developing and commercializing innovative antibacterial agents to address multi-drug resistant (MDR) gram-negative infections, announced that it has filed a voluntary petition under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware (the Court). Achaogen has also filed a motion seeking authorization to pursue an auction and sale process under Section 363 of the U.S. Bankruptcy Code.

Achaogen has filed a series of motions with the Court seeking to ensure the continuation of normal operations during this process. Achaogen has the support of its secured lender, Silicon Valley Bank, which has made a $25 million financing commitment to fund the Company’s operations through the auction and sale process. The Company believes that this commitment provides it with sufficient liquidity to continue to meet its operational and financial obligations to patients, physicians, suppliers and employees.

“The Achaogen Board of Directors and management team have thoroughly assessed our strategic options and financial situation and unanimously agree that this structured sale process represents the best possible solution for the Company,” said Blake Wise, CEO of Achaogen. “We continue to believe ZEMDRI® (plazomicin) has the potential to be a valuable component of a portfolio of anti-infective or hospital products and an important life-saving medicine for patients.”

The proposed bidding procedures, if approved by the Court, would allow interested parties to submit binding offers to acquire substantially all of Achaogen’s assets, which would be purchased free and clear of the Company’s indebtedness and liabilities. Interested parties could include both strategic and financial buyers, for whom substantial due diligence materials are available.

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