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Following FDA Approval of YCANTH™ for the Treatment of Molluscum Contagiosum, Verrica Pharmaceuticals Enters into Non-Binding Term Sheet for up to $125 Million Debt Financing; Company to Host Conference Call and Webcast This Morning at 8:30 am ET
Term loan facility would provide for up to $125M in non-dilutive capital; $50M immediately available to Company following close of the transaction, which is
About this update from Verrica Pharmaceuticals Inc.
[{"type":"text","content":"Term loan facility would provide for up to $125M in non-dilutive capital; $50M immediately available to Company following close of the transaction, which is expected to occur by the end of this week –YCANTH™ is now the first FDA-approved treatment for molluscum, a highly contagious viral skin infection affecting approximately 6 million people annually in the United States, primarily children –Verrica to host investor conference call and webcast this morning at 8:30 a.m. ET – WEST CHESTER, Pa., July 24, 2023 (GLOBE NEWSWIRE) -- Verrica Pharmaceuticals Inc. (“Verrica” or “the Company”) (Nasdaq: VRCA), a dermatology therapeutics company developing medications for skin diseases requiring medical interventions, today announced that the Company has entered into a non-binding term sheet for a term loan facility of up to $125 million, which the Company expects to close by the end of this week. Under the terms of the term sheet, Verrica intends to borrow $50 million immediately following the close of the transaction, with additional capital available in tranches based on the achievement of certain revenue milestones. The facility is a five-year term loan that matures in July 2028. The term loan will bear interest at a rate based upon the secured overnight financing rate (SOFR), subject to a SOFR floor of 4%, in addition to a margin of 8% per annum. The Term Sheet also contemplates the issuance to the lender of a warrant to purchase $3.1 million of the Company’s common stock, with an exercise price equivalent to the trailing 10-day volume weight average price of the common stock. Upon close of the transaction, Verrica expects the $50 million upfront, plus the $60 million in cash and cash equivalents on-hand as of March 31, 2023, to extend the Company’s cash runway into the first quarter of 2025. The term sheet does not represent a definitive loan agreement and there is no guarantee that the Company will enter into a definitive loan agreement, close the proposed loan facility with the lender or borrow any funds pursuant to the loan facility. Later this morning, the Company will host a conference call and webcast at 8:30 a.m. ET to discuss the U.S. Food and Drug Administration (FDA) approval of YCANTH™ (cantharidin) topical solution for the treatment of molluscum contagiosum (molluscum) in adult and pediatric patients 2 years of age and old...