- The $10 million loan agreement, carrying a 12% interest rate and secured by all assets of Clene, was signed with three lenders affiliated with the company.
- The funds will be used to repay the remaining $7.9 million debt of an Avenue Capital Group loan, and will improve the company’s cash position, enabling it extra runway to generate additional data to support the new drug application of CNM-Au8 for ALS.
- The FDA earlier suggested that Clene leverage additional neurofilament light (“NfL”) data from the company’s three Expanded Access Protocols (compassionate use programs) and the HEALEY ALS Platform Trial to support earlier clinical trial findings, with a follow-up meeting with the FDA to be held in early 2025.
Clene (NASDAQ: CLNN) and its wholly owned subsidiary, Clene Nanomedicine Inc., is a late clinical-stage biopharmaceutical company focused on improving mitochondrial health and protecting neuronal function to treat neurodegenerative diseases, including amyotrophic lateral sclerosis (“ALS”) and multiple sclerosis (“MS”). The company has now secured a new $10 million debt facility, enabling the pay-off of another loan at higher interest rates to significantly improve its cash position as well as finance operations to generate of additional data to support the new drug application of lead drug candidate CNM-Au8 for ALS (https://ibn.fm/Maor9).
The new debt facility was signed with three entities affiliated with Clene and was closed on Dec. 20, 2024. Under the terms of the deal, the three lenders provided the aggregate principal amount of $10 million for the secured, partially convertible debt facility, with a fixed interest rate of 12% and a maturity eighteen months after closing. The first 12 twelve months are interest-only. Sixty-five percent of the debt facility is convertible into shares at a fixed conversion price of $5.67, a 130% premium to Clene’s closing stock price on the day of signing.
The funding will be used to pay off the remaining debt of an existing senior loan taken with Avenue Venture Opportunities Fund, L.P., a fund of the Avenue Capital Group, in May 2021. Over the course of the loan agreement, Clene borrowed $20 million. Repayment under the loan agreement began in July 2024 with $7 million of principal outstanding as of December 2024 plus a final payment fee of $0.85 million, for a total payoff of approximately $7.9 million, including a prepayment penalty.
The new loan will help improve the company’s cash position, enabling the cash runway to generate additional biomarker data to support the new drug application of CNM-Au8 for ALS via an accelerated regulatory pathway. The company met with the U.S. Food and Drug Administration (“FDA”) to discuss a potential accelerated regulatory pathway in November and has since received additional guidance from the regulatory body to gather further clinical trial data.
CNM-Au8, an oral suspension of gold nanocrystals, works by improving cellular energy production and utilization, which is critical for maintaining neuronal health. The drug candidate has already been shown to improve central nervous system cells’ survival and function via a mechanism that targets mitochondrial function and the nicotinamide adenine dinucleotide (“NAD”) pathway while reducing oxidative stress. Phase 2 clinical trial data, as presented to the FDA, revealed significant improvement in survival rates, functional status and combined assessment of function and survival.
The FDA recommended that Clene leverage additional NfL data from its three expanded access protocols (“EAPs”) and the HEALEY ALS Platform Trial to support earlier findings. Clene will have another meeting with the FDA in early 2025 to review and finalize its analysis plan for the EAP NfL biomarker analyses.
Commenting on the new debt facility, Clene CEO and President Rob Etherington said the company was grateful for the trust of its long-standing investors who remain supportive of the company’s efforts to provide potentially lifesaving therapies for ALS and other neurodegenerative diseases.
“We believe that the proceeds from this new debt facility, including an extended interest-only period, will allow Clene the cash runway to generate the additional data the U.S. Food and Drug Administration has requested from our expanded access programs,” Etherington added. “The data are being gathered to support the existing clinical study data for inclusion in an application seeking approval of CNM-Au8 for ALS through the accelerated regulatory pathway.”
For more information, visit the company’s website at www.Clene.com.
NOTE TO INVESTORS: The latest news and updates relating to CLNN are available in the company’s newsroom at https://ibn.fm/CLNN
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