AXSM
Axsome Therapeutics, INC
NASDAQ
8-K: Axsome Therapeutics Secures $570 Million Credit Facility with Blackstone, Retires Existing Debt
Sentiment:
8-K Filing
13 May 2025 7:06 AM
Axsome Therapeutics enters into a $570 million term loan and revolving credit facility with Blackstone, retiring its previous debt with Hercules Capital and strengthening its financial position.
Capital raise
Axsome conducted a private placement of 140,000 shares of common stock to Blackstone at a price of $107.14 per share.
The gross proceeds from the private placement were approximately $15 million.
Purchasers agreed to a lock-up period of 120 days from the closing date, restricting the sale or transfer of the securities.
Summary
- Axsome Therapeutics has entered into a $570 million credit facility with Blackstone, consisting of a term loan and a revolving credit facility.
- The company used part of the term loan to retire its previous debt with Hercules Capital.
- The new facility includes a $500 million term loan and a $70 million revolving credit facility.
- Axsome drew down $120 million from the term loan upon closing to retire the Hercules Capital loan.
- An additional $250 million may be drawn at Axsome's option, with another $200 million available subject to Blackstone's approval.
- The term loan bears interest at SOFR plus 4.75%, while the revolving credit facility bears interest at SOFR plus 4.0%.
- The facility matures in May 2030 and has a 60-month interest-only payment period.
- Concurrent with the agreement, Blackstone purchased $15 million of Axsome common stock at $107.14 per share.
- The loan agreement contains a minimum liquidity covenant of $30 million, tested quarterly.
Sentiment
Score: 8
Explanation: The document conveys a positive sentiment due to the improved financial terms of the new credit facility, the partnership with Blackstone, and the expectation of reduced interest expenses. The successful refinancing and capital injection are viewed favorably.
Positives
- The new credit facility expands Axsome's available credit by over $200 million.
- The agreement is expected to significantly reduce interest expenses.
- The partnership with Blackstone provides access to their expertise in the life sciences industry.
- The improved terms of the new facility support accelerating time to profitability and enhancing shareholder value.
- The facility includes a 60-month interest-only payment period, providing flexibility in the near term.
Negatives
- The loan agreement contains a minimum liquidity covenant of $30 million, tested quarterly, which could restrict financial flexibility if not maintained.
- The loans are subject to mandatory prepayment provisions upon certain events like a change of control or asset sales.
Risks
- Failure to maintain the minimum liquidity covenant of $30 million could trigger an event of default.
- Mandatory prepayment provisions could be triggered by unforeseen events, requiring early repayment of the loans.
- The availability of the additional $200 million under the term loan facility is subject to Blackstone's approval.
Future Outlook
The company expects the new facility to result in a significant reduction in interest expense and support its next phase of growth. Axsome aims to accelerate time to profitability and enhance shareholder value.
Management Comments
- 'The improved financial terms and expected use of the new facility are expected to result in a significant reduction in interest expense,' said Herriot Tabuteau, MD, Chief Executive Officer of Axsome Therapeutics.
- 'We are pleased to partner with the Blackstone team given their differentiated expertise in the life sciences industry.'
- 'The improved terms of the new facility underscore our commitment to accelerating time to profitability and enhancing shareholder value, while advancing our mission to improve the lives of patients living with serious CNS disorders.'
Industry Context
This announcement reflects a trend in the biopharmaceutical industry where companies seek flexible financing solutions to support growth and commercialization efforts. Partnering with specialized investors like Blackstone Life Sciences provides not only capital but also industry expertise.
Comparison to Industry Standards
- Comparable companies in the biopharmaceutical sector often utilize term loans and revolving credit facilities to fund clinical trials, commercial launches, and acquisitions.
- The interest rates on the Axsome facility (SOFR plus 4.75% and SOFR plus 4.0%) are within the typical range for similar loans in the current market environment, but the exact rate depends on the company's credit profile and the specific terms negotiated.
- Other companies like Biohaven Pharmaceutical Holding Company Ltd. have secured similar financing arrangements to support their commercial operations and pipeline development.
Stakeholder Impact
- Shareholders are expected to benefit from the reduced interest expenses and improved financial flexibility.
- The company's ability to invest in research and development and commercialization efforts is enhanced, potentially benefiting patients.
- Employees may experience increased job security due to the company's strengthened financial position.
Next Steps
- File the Loan Agreement and Purchase Agreement as exhibits to the company's next periodic report with the SEC.
- Monitor compliance with the minimum liquidity covenant of $30 million.
- Potentially draw down additional funds from the term loan facility as needed, subject to Blackstone's approval.
Related Party Transactions
- Blackstone purchased $15 million of Axsome common stock at $107.14 per share, concurrent with the closing of the credit facility.
Key Dates
- May 08, 2025: Closing Date of the Loan Agreement and Securities Purchase Agreement
- May 13, 2025: Date of the press release announcing the Loan Agreement
- May 31, 2026: $90 million of the senior secured term loan is available until this date
- May 31, 2027: The remaining $90 million of the senior secured term loan is available until this date
- May 2030: Maturity date of the Loans
Keywords
credit facility, term loan, revolving credit, Blackstone, Axsome Therapeutics, financing, debt, CNS disorders, biopharmaceutical
AXSM
Axsome Therapeutics, INC
NASDAQ
Sector: TBD
Filings with Classifications
Delay expected
9 June 2025 7:05 AM
Regulatory Update
- The Refusal to File (RTF) letter from the FDA necessitates an additional controlled trial for AXS-14.
- This new trial is anticipated to be initiated in the fourth quarter of 2025, indicating a delay in the regulatory pathway and potential market entry for AXS-14.
Worse than expected
9 June 2025 7:05 AM
Regulatory Update
- The FDA issued a Refusal to File (RTF) letter for the AXS-14 NDA, indicating the application was not sufficiently complete for substantive review.
- This requires Axsome to conduct an additional controlled trial, delaying the potential approval and commercialization of AXS-14.
Capital raise
13 May 2025 7:06 AM
8-K Filing
- Axsome conducted a private placement of 140,000 shares of common stock to Blackstone at a price of $107.14 per share.
- The gross proceeds from the private placement were approximately $15 million.
- Purchasers agreed to a lock-up period of 120 days from the closing date, restricting the sale or transfer of the securities.
Capital raise
5 May 2025 4:47 PM
Quarterly Report
- The Company may use a combination of public and private equity offerings, debt financings, other third-party funding, strategic alliances, licensing arrangements or marketing and distribution arrangements if market conditions are favorable or as a result of other strategic considerations to finance its future cash needs.
Better than expected
5 May 2025 4:47 PM
Quarterly Report
- Revenue increased significantly year over year.
- Net loss decreased year over year.
Delay expected
5 May 2025 4:47 PM
Quarterly Report
- If Subtenant is delayed in completing the New Premises Subtenant Work and vacate the Original Premises within four (4) months of the New Premises Commencement Date, subject to Force Majeure, then, notwithstanding anything to the contrary contained herein, Subtenant shall not be required to pay holdover rent as set forth in Section 3 above for the amount of time that Prime Landlords actions delayed Subtenant in completing the New Premises Subtenant Work (such amount of time, the Prime Landlord Delay) and the Original Premises Termination Date shall be extended by such period of Prime Landlord Delay; provided however that maximum amount of time for the delay in Subtenant paying holdover rent pursuant to Section 3 hereof shall be an additional thirty (30) days so that if Subtenant has not vacated the Original Premises and delivered possession of the Original Premises to Sublandlord due to Prime Landlord Delay within five (5) months of the New Premises Commencement Date, for whatever reason whatsoever, Subtenant shall pay such holdover rent pursuant to Section 3 hereof.
Better than expected
5 May 2025 7:33 AM
Quarterly Report
- The company's revenue growth exceeded expectations, driven by strong sales of AUVELITY and SUNOSI.
- The approval of SYMBRAVO and positive clinical trial results for solriamfetol in ADHD and SYMBRAVO in migraine patients were better than expected.
Worse than expected
1 April 2025 7:06 AM
Press Release
- The PARADIGM Phase 3 trial did not meet its primary endpoint in the overall patient population, indicating worse than expected results.
Better than expected
25 March 2025 7:06 AM
Clinical Trial Results
- The FOCUS Phase 3 trial achieved both its primary and key secondary endpoints, demonstrating statistically significant improvements in ADHD symptoms and disease severity compared to placebo.
Worse than expected
18 February 2025 5:10 PM
Annual Results
- The company's net loss increased from 2023 to 2024.
- Research and development expenses increased from 2023 to 2024.
- Selling, general, and administrative expenses increased from 2023 to 2024.
Capital raise
18 February 2025 5:10 PM
Annual Results
- The company may need to raise additional financing to support its continuing operations.
- The company may seek to fund its operations through public or private equity, debt financings, or other sources.
Delay expected
18 February 2025 7:06 AM
Annual Results
- Topline results from the ENGAGE Phase 3 trial of solriamfetol in BED are now anticipated in 2026.
Better than expected
18 February 2025 7:06 AM
Annual Results
- The company's revenue growth exceeded expectations, driven by strong sales of Auvelity and Sunosi.
- The FDA approval of Symbravo was a positive development, expanding the company's commercial portfolio.
- The successful completion of Phase 3 trials for AXS-05 and AXS-12 positions the company for potential NDA submissions and future product launches.
Better than expected
30 January 2025 5:55 PM
Press Release
- SYMBRAVO demonstrated statistically significant superiority compared to rizatriptan on sustained pain freedom from 2 to 24 hours.
Better than expected
30 December 2024 7:56 AM
Clinical Trial Results
- The ACCORD-2 trial met its primary endpoint with a statistically significant result, demonstrating a 3.6-fold lower risk of relapse compared to placebo, which is better than expected.
- The ACCORD-2 trial also met its key secondary endpoint, showing statistically significant prevention of relapse of agitation, which is better than expected.
- AXS-05 reduced the worsening of overall Alzheimer's disease severity compared to placebo in the ACCORD-2 trial, which is better than expected.
Better than expected
26 November 2024 7:05 AM
Clinical Trial Results
- The trial met its primary endpoint with statistically significant results, showing a reduction in cataplexy attacks compared to placebo.
- The drug also demonstrated statistically significant improvements in cognition and overall narcolepsy symptoms, exceeding expectations.
Worse than expected
12 November 2024 9:43 AM
Quarterly Report
- The company's net loss increased compared to the same period last year, indicating worse than expected results.
Capital raise
12 November 2024 9:43 AM
Quarterly Report
- The company may use a combination of public and private equity offerings, debt financings, other third-party funding, strategic alliances, licensing arrangements or marketing and distribution arrangements if market conditions are favorable or as a result of other strategic considerations to finance its future cash needs.
Better than expected
12 November 2024 7:07 AM
Quarterly Report
- The company's revenue growth significantly exceeded expectations, with Auvelity sales growing by 113% year-over-year.
- The company is progressing its pipeline faster than expected with multiple topline results expected in the near term.
- The company has sufficient cash to fund operations into cash flow positivity, which is better than expected.
Better than expected
1 October 2024 5:24 PM
Loan Agreement Amendment
- The loan amendment provides better terms for Axsome, including an increased tranche commitment, extended availability periods, and more flexible performance covenants.
Worse than expected
5 August 2024 4:30 PM
Quarterly Report
- The company reported a net loss of $79.3 million for the quarter, which is worse than the net loss of $67.2 million reported for the same period in the previous year.
Capital raise
5 August 2024 4:30 PM
Quarterly Report
- The company may use a combination of public and private equity offerings, debt financings, other third-party funding, strategic alliances, licensing arrangements or marketing and distribution arrangements if market conditions are favorable or as a result of other strategic considerations to finance its future cash needs.
Better than expected
5 August 2024 7:05 AM
Quarterly Report
- The company's revenue growth of 87% year-over-year and Auvelity sales growth of 135% year-over-year significantly exceeded expectations.
Delay expected
5 June 2024 7:38 AM
Settlement Announcement
- The settlement delays the entry of a generic version of Sunosi until at least June 30, 2042.
Worse than expected
6 May 2024 5:20 PM
Quarterly Report
- The company's net loss increased significantly compared to the same period last year, indicating worse than expected financial performance.
Capital raise
6 May 2024 5:20 PM
Quarterly Report
- The company may use a combination of public and private equity offerings, debt financings, other third-party funding, strategic alliances, licensing arrangements or marketing and distribution arrangements if market conditions are favorable or as a result of other strategic considerations to finance its future cash needs.
Worse than expected
6 May 2024 7:05 AM
Quarterly Report
- The company's net loss of $68.4 million for the quarter was significantly worse than the $11.2 million loss in the same period of 2023.
Worse than expected
25 March 2024 9:06 AM
Patient Survey Results Announcement
- The survey results show that a high percentage of patients continue to experience symptoms despite being on treatment, indicating that current treatments are not as effective as expected.
Better than expected
25 March 2024 9:02 AM
Clinical Trial Results
- The results of the SYMPHONY trial were better than expected, as AXS-12 demonstrated statistically significant improvements across multiple endpoints compared to placebo.
Better than expected
20 February 2024 7:05 AM
Annual Results
- The company's revenue growth of 309% year-over-year significantly exceeded expectations.
- Auvelity's sales of $130.1 million in its first full year of launch surpassed initial projections.
- Sunosi's 67% year-over-year revenue growth was also better than anticipated.
Delay expected
20 February 2024 7:05 AM
Annual Results
- The completion of the ADVANCE-2 trial for Alzheimer's disease agitation is now anticipated in the second half of 2024, due to enrollment trends and market dynamics, which is a delay from previous expectations.
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