Benzinga | Oct 4, 2021 08:15AM EDT

Centessa Pharmaceuticals Announces $300M Financing Agreement With Oberland Capital

Centessa Pharmaceuticals plc ("Centessa" or "Company") (NASDAQ:CNTA), a clinical-stage company leveraging its innovative asset-centric business model to discover, develop and ultimately deliver impactful medicines to patients, today announced that it has entered into a $300 million financing agreement with funds managed by Oberland Capital Management LLC ("Oberland Capital").



Oberland Capital will purchase up to $300 million of 6-year, interest-only, senior secured notes ("Notes") from the Company under the following terms:

* $75 million funded October 4, 2021 ("First Purchase Date")

* $125 million available to be funded in tranches of $75 million and $50 million within 24 months of First Purchase Date at the option of the Company

* $100 million available to fund M&A, in-licensing, or other strategic transactions, at the option of the Company and Oberland Capital

* The Notes are interest-only for the full 6-year term; principal on the Notes will be due October 4, 2027, with certain contingent and capped payments due up to ten years from First Purchase Date

* Flexible structure with no financial covenants

This $300 million facility, combined with the Company's existing cash balance as of June 30, 2021, provides access to over $900 million to advance the Company's pipeline of clinical and pre-clinical programs and enables the Company to pursue strategic business development opportunities.

"Our ability to secure such a flexible, long-term financing arrangement with a 6-year, interest-only period is directly enabled by our broad portfolio of uncorrelated programs based on compelling biology. On the heels of our recent positive Phase 2 readout of SerpinPC and upcoming registrational trial for lixivaptan, this financing will allow us to further scale up our development activities and provide enhanced balance sheet flexibility for pipeline expansion," said Gregory Weinhoff, MD, MBA, Chief Financial Officer of Centessa.

"We are excited to be partnering with Centessa to help bring their portfolio of innovative product candidates to patients as quickly as possible," said Andrew Rubinstein, Managing Partner of Oberland Capital. "Our flexible financing structure is designed to allow the Centessa team to maintain maximum optionality as their pipeline matures, with two programs entering potential registrational studies next year and multiple INDs expected."

Additional details regarding the financing are available in the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission today. The foregoing summary of certain terms of the financing agreement and related agreements is qualified in its entirety by reference to the full text of such agreements, which will be filed as exhibits to our next Form 10-Q.