Albireo Pharma, Inc., a clinical-stage orphan pediatric liver disease company developing novel bile acid modulators, today announced it has agreed to terms with Hercules Capital, Inc. on a debt facility to provide up to $80 million of new capital, and will receive $15M under a restructured royalty monetization agreement with HealthCare Royalty Partners (HCR) for elobixibat in the treatment of chronic constipation in Japan. Elobixibat, approved in Japan for the treatment of patients with chronic constipation, is the first ileal bile acid transporter (IBAT) inhibitor approved anywhere in the world.
“These funding arrangements with new and existing partners provide the company additional flexibility and cash runway into the beginning of 2022, past the planned approval and commercial launch of odevixibat for the treatment of progressive familial intrahepatic cholestasis,” said Ron Cooper, President and Chief Executive Officer of Albireo. “This strengthened financial foundation will also enable our continued growth as we deliver on additional odevixibat pivotal trials, NASH clinical development and pre-clinical programs.”
Under the updated terms of the agreement with HCR, the company will receive an additional $15 million on top of the $45 million royalty financing commitment HCR made in 2018 for royalty rights based on sales for elobixibat in the treatment of chronic constipation in Japan. In exchange, the company eliminated the cap on HCR’s rights to receive royalties on sales in Japan and sales milestones for elobixibat in certain other territories that may become payable by the Company’s partner, EA Pharma Co., Ltd.. Elobixibat is marketed and sold in Japan under the trade name GOOFICE.
“HCR’s additional investment reinforces our view that elobixibat’s unique mechanism of action results in a differentiated product that provides a meaningful benefit to patients in Japan”, said John Urquhart, Managing Director of HCR.
Under the terms of the new agreement with Hercules Capital, Albireo may access up to $80 million of new capital, with an initial minimum of $10 million drawn down on a first available tranche of $15M, and additional tranches based on regulatory and other milestones.
“Hercules is pleased to be partnering with Albireo and supporting its clinical efforts which are focused on the development of novel treatments for orphan pediatric liver diseases, and other liver and gastrointestinal diseases and disorders. This structured debt investment represents a significant commitment from Hercules, and it is consistent with our goal of supporting innovative life sciences companies through all stages of development," said Kristen Kosofsky, Senior Managing Director at Hercules.