TRACON Pharmaceuticals Inc (NASDAQ:TCON) revealed that the clinical stage biopharmaceutical company had struck an up to $30 million non-recourse financing agreement.
“This non-dilutive funding provides for upfront capital along with potential post-award financing, so we may realize the value of a potential arbitration award once issued,” TRACON Pharmaceuticals CEO Charles Theuer said in a statement.
“We look forward to the announcement of the arbitration award that is expected in the first quarter of 2023,” he added.
According to the company, an initial $3.5 million will be funded before December 31, 2022. The additional $26.5 million, or a lesser amount based on the amount awarded, will be available subject to the award exceeding a threshold and satisfaction of other conditions set forth in the agreement, with 25% of the total being available to be funded after award announcement and the remainder available over a multi-year period.
TRACON said the non-recourse funding will be repaid on collection of any award from I-Mab at varying rates that depend on the time elapsed from funding and certain other matters related to the arbitration.
The San Diego company, which utilizes a capital-efficient product development platform to develop its clinical-stage pipeline of cancer therapies, plans to use the funds to confirm and enforce any award and for working capital and general corporate purposes.
TRACON’s clinical-stage pipeline includes Envafolimab, a PD-L1 single-domain antibody given by rapid subcutaneous injection that is being studied in the pivotal ENVASARC trial for sarcoma; YH001, a potential best-in-class CTLA-4 antibody in Phase 1 development; TRC102, a Phase 2 small molecule drug candidate for the treatment of lung cancer; and TJ004309, a CD73 antibody in Phase 1 development for the treatment of advanced solid tumors.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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