SAN DIEGO--(BUSINESS WIRE)--Ignyta, Inc. (Nasdaq: RXDX), a biotechnology company focused on precision medicine in oncology, announced today that it has secured a $42 million term loan facility from Silicon Valley Bank and Oxford Finance. Under the loan facility, the company received initial funding of $32 million, substantially all of which was used to repay the company's prior loan with Silicon Valley Bank, and has a conditional option to receive an additional $10 million.
"This loan facility strengthens our balance sheet, enabling us to aggressively pursue the development of our lead program, entrectinib, and continue the development of the rest of our precision medicine oncology pipeline," said Jacob Chacko, M.D., CFO of Ignyta. "We appreciate the support Silicon Valley Bank and Oxford Finance are providing to us as we continue to grow."
The loan agreement, in addition to customary conditions, provides that the second tranche of $10 million may be drawn down by Ignyta at any time from April 7, 2017 to August 31, 2017, provided that Ignyta has satisfied certain conditions to trigger the second tranche.
Borrowings under the credit facility will bear interest at a rate of Prime + 4.35%, and have interest only payments for twenty-four months, followed by an amortization period of thirty-six months. The interest only period will be extended by an additional six months in the event Ignyta has satisfied certain conditions to trigger the six-month extension. In the event that the interest only period is extended, then the amortization period will be reduced to thirty months. In connection with entering the credit facility, Ignyta also agreed to issue warrants to Silicon Valley Bank and Oxford Finance equal to 1.5% of the funded amount, with an exercise price equal to the lower of the ten-day average price of Ignyta’s common stock prior to funding or the price per share on the day prior to funding.
About Ignyta, Inc.
At Ignyta, we fight cancer – a formidable opponent that manifests as thousands of different molecularly defined diseases and takes away millions of lives globally, every year. In this fight, our vision is not just to shrink tumors but to eradicate residual disease – the source of cancer relapse and recurrence – in precisely defined patient populations by 2030. We will work tirelessly to achieve this vision by pursuing an integrated therapeutic (Rx) and companion diagnostic (Dx) strategy for treating cancer patients. Our Rx efforts are focused on discovering, in-licensing or acquiring, then developing and commercializing, molecularly targeted therapies that, sequentially or in combination, are foundational for eradicating residual disease. Our Dx efforts aim to pair these product candidates with biomarker-based companion diagnostics that are designed to precisely identify, at the molecular level, the patients who are most likely to benefit from the therapies we develop. We believe that only through this integrated Rx/Dx approach can we succeed in this fight.
For more information, please visit: www.ignyta.com.
This press release contains “forward-looking statements” about Ignyta as that term is defined in the Private Securities Litigation Reform Act of 1995. Statements in this press release that are not purely historical are forward-looking statements. Such forward-looking statements include, among other things, references to the potential for Ignyta to draw down the second loan tranche, the potential for Ignyta to extend the interest-only period for the loans, the potential for Ignyta to receive positive interim Phase 2 data in its STARTRK-2 trial of entrectinib, and the ability of Ignyta to aggressively pursue the development of its lead program, entrectinib and continue the development of the rest of its precision medicine oncology pipeline. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the potential for receiving positive clinical trial data; the inherent uncertainties associated with developing new products or technologies and operating as a development stage company; regulatory developments in the United States and foreign countries; Ignyta's ability to develop, complete clinical trials for, obtain approvals for and commercialize any of its product candidates; changes in Ignyta's plans to develop and commercialize its product candidates; Ignyta's ability to raise any additional funding it will need to continue to pursue its business and product development plans; Ignyta's ability to obtain and maintain intellectual property protection for its product candidates; the loss of key scientific or management personnel; competition in the industry in which Ignyta operates; and market conditions. These forward-looking statements are made as of the date of this press release, and Ignyta assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Investors should consult all of the information set forth herein and should also refer to the risk factor disclosure set forth in the reports and other documents the company files with the SEC available at www.sec.gov, including without limitation Ignyta's Annual Report on Form 10-K for the year ended December 31, 2015 and subsequent Quarterly Report on Form 10-Q.