NOVATO, Calif., Dec. 20, 2012 (GLOBE NEWSWIRE) -- Raptor Pharmaceutical Corp. ("Raptor" or the "Company") (Nasdaq:RPTP), today announced that it has signed a $50 million loan agreement with HealthCare Royalty Partners ("HC Royalty") to help fund the commercialization of PROCYSBI™, the branded name of RP103 for the potential treatment of nephropathic cystinosis, and advance the Company's development programs.
Under the terms of the agreement, Raptor will receive $25 million (the "First Tranche Loan") at closing and an additional $25 million (the "Second Tranche Loan") upon U.S. Food and Drug Administration approval of PROCYSBI. The First Tranche and Second Tranche Loans, which mature on December 31, 2019, bear interest at an annual fixed rate of 10.75% and a Synthetic Royalty® variable rate, tiered down, based on a percentage of future PROCYSBI sales. The loan is interest-only for the first two years.
"This loan agreement with HC Royalty further validates the growing value of PROCYSBI and Raptor's pipeline. We believe that the proceeds of this financing will provide us with the necessary capital to fund our activities through FDA approval of PROCYSBI, based on our current assumptions for the timing of a potential FDA approval of PROCYSBI, as well as to fund our plans to launch PROCYSBI in the U.S., if approved by the FDA," stated Christopher Starr, Raptor's CEO. "At closing of the first Tranche we will have over $55 million in cash on our balance sheet, with an additional $25 million to be funded under the Second Tranche Loan upon FDA approval of PROCYSBI.""There is significant unmet market need for a more tolerable cystinosis treatment with a less burdensome dosing schedule and we believe PROCYSBI will fill that need for patients once it is approved by the FDA," commented Clarke B. Futch, Founding Managing Director at HC Royalty. "We are pleased to partner with Raptor to help fund the commercialization of this important orphan drug."