UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 10, 2022 (March 8, 2022 )
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | |||||||||||||||
(Address of principal executive offices, including zip code)
(844 ) 445-5704
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | ||||||||||||||||||||||||||
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||||||||||||||||||||||||
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||||||||||||||||||||||||
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||||||||||||||||||||||||
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | ||||||||||||||||||||||||||
| Securities registered pursuant to Section 12(b) of the Act: | ||||||||||||||||||||||||||
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter). | ||||||||||||||||||||||||||
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry Into a Material Definitive Agreement.
On March 8, 2022, Xeris Biopharma Holdings, Inc. (the “Company”), Xeris Pharmaceuticals, Inc. (“Xeris Pharma”) and certain subsidiaries of the Company parties thereto entered into a Credit Agreement and Guaranty (the "Credit Agreement") with the lenders from time to time parties thereto (the “Lenders”) and Hayfin Services LLP, as administrative agent for the Lenders, pursuant to which the Company and its subsidiaries parties thereto granted a first priority security interest in substantially all of their assets, including intellectual property, subject to certain exceptions. The Credit Agreement provides for the Lenders to extend $100.0 million in term loans (the “Initial Loan”) to the Company initially and up to an additional $50.0 million in delayed draw term loans during the one year period immediately following the closing date (the “Delayed Draw Term Loans” and, together with the Initial Loan, the “Loans”) in no more than three drawings of no less than $10.0 million per drawing subject to the Company being in pro forma compliance with the financial covenants and other conditions set forth therein. In conjunction with the execution of the Credit Agreement, the Amended and Restated Loan and Security Agreement by and among the Company, Xeris Pharma, certain subsidiaries of the Company, Silicon Valley Bank and Oxford Finance LLC (as amended, the “A&R LSA”), was repaid in full and the final payment of $45.8 million was paid. In addition to utilizing the proceeds to repay the obligations under the A&R LSA in full, the proceeds will otherwise be used for general corporate purposes. After repayment, the Loans may not be re-borrowed.
The Lenders also received warrants to purchase 1,315,789 shares of common stock of the Company at a price of $2.28 per share (the “Warrants”). The Warrants are (i) exercisable until the seventh (7th) anniversary of the closing date; (ii) freely transferable and detachable from the Loans; and (iii) subject to customary warrant holder rights and protections, including structural-based anti-dilution protection and adjustments for stock dividends, splits, combinations, reclassifications and the like.
All of the Loans incur interest at a floating per annum rate in an amount equal to the sum of (i) 9.0% (or 8.0% per annum if the replacement rate in effect is the Wall Street Journal Prime Rate) plus (ii) the greater of (x) (1) CME Group Benchmark Administration Limited (CBA) Term SOFR (or the replacement rate, if applicable) if CBA Term SOFR is greater than 1.00% plus 0.26161% or (2) 1.00% if CME Term SOFR is less than 1.00% and (y) one percent (1.00%) per annum (or 2.0% per annum if the replacement rate in effect is the Wall Street Journal Prime Rate).
The Credit Agreement allows the Company to voluntarily prepay the outstanding amounts thereunder. The Company is subject to an early prepayment fee equal to (i) for any prepayment that occurs prior to the second anniversary of the closing date, the applicable make-whole amount, (ii) for any prepayment that occurs after the second anniversary of the closing date but on or prior to the fourth anniversary of the closing date: (x) the amount of any principal so prepaid, multiplied by (y) for any prepayment that occurs (A) after the second anniversary of the closing date and on or prior to the third anniversary of the closing date, five percent (5.0%), and (B) after the third anniversary of the closing date and on or prior to the fourth anniversary of the closing date, three percent (3.0%), and (iii) after the fourth anniversary of the closing date, zero percent (0.0%).
The Credit Agreement contains customary representations and warranties, events of default (including an event of default upon a material adverse change of the Company) and affirmative and negative covenants, including, among others, covenants that limit or restrict the Company’s ability to incur additional indebtedness, grant liens, merge or consolidate, make acquisitions, pay dividends or other distributions or repurchase equity, make investments, dispose of assets and enter into certain transactions with affiliates, in each case subject to certain exceptions.
The foregoing descriptions of the Credit Agreement and Form of Warrant are qualified in their entirety by reference to the complete text of the Credit Agreement and Form of Warrant, which the Company intends to file with the Securities and Exchange Commission (“SEC”) as exhibits to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2022.
Item 2.02. Results of Operations and Financial Condition.
On March 10, 2022, the Company issued a press release containing information about the Company’s results of operations and business highlights for the three and twelve months ended December 31, 2021. A copy of this press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information in this Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 above is incorporated herein by reference.
Item 8.01 Other Events.
On March 10, 2022, the Company issued a press release announcing the signing of the Credit Agreement. A copy of such press release is attached hereto as Exhibit 99.2 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
| Exhibit Number | Description | |||||||
| 99.1 | ||||||||
| 99.2 | ||||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: March 10, 2022 | Xeris Biopharma Holdings, Inc. | |||||||||||||
| By: | /s/ Steven M. Pieper | |||||||||||||
| Name: Steven M. Pieper | ||||||||||||||
Title: Chief Financial Officer | ||||||||||||||
Exhibit 99.1
XERIS BIOPHARMA REPORTS FOURTH QUARTER AND FULL-YEAR 2021 FINANCIAL RESULTS AND RECENT EVENTS
Acquisition and integration of Strongbridge Biopharma completed; $50M in synergies to be realized by year-end 2022
Recorlev® approved by FDA
FY ‘21 pro forma net product revenues of $79M – a 56% increase from prior year
Well-capitalized with cash, cash equivalents, and short-term investments of $102.4M at YE 2021
Double-digit net product revenues growth expected in 2022 to be $105M - $120M
Cash position further strengthened with a recent PIPE and the restructuring of debt with Hayfin Capital; 2022 year-end cash, cash equivalents, and short-term investments of $90M-$110M expected
Cash flow breakeven expected by year-end 2023
Conference call and webcast today at 8:30 a.m. ET
CHICAGO, IL; March 10, 2022 – Xeris Biopharma Holdings, Inc. (Nasdaq: XERS), a biopharmaceutical company developing and commercializing unique therapies for patient populations in endocrinology, neurology, and gastroenterology, and Xeris Pharmaceuticals, Inc., today announced financial results for the fourth quarter and full-year 2021 and recent highlights.
“During 2021, we made significant progress toward achieving critical mass and becoming a fully integrated pharmaceutical company with the acquisition of Strongbridge, the continued growth of Gvoke and Keveyis, and the recent approval and launch of our third commercial product, Recorlev,” said Paul R. Edick, Chairman and CEO of Xeris Biopharma. “2022 is all about execution and building long-term shareholder value. With three commercial products in large addressable markets and a strong cash position, we believe we can achieve 2022 net product revenues in the range of $105 million to $120 million and drive to cash flow breakeven by year-end 2023.”
Fourth Quarter and Full-year 2021 Highlights and Recent Events
Marketed Products
•Gvoke®: Fourth quarter 2021 prescriptions topped 29,000 for the first time, growing more than 85% compared to the same period in 2020. Gvoke’s market share of the retail TRx glucagon market grew to approximately 17% at year-end. In June, the FDA approved the extension of room temperature shelf-life of the Gvoke 1mg HypoPen and PFS from 24 months to 30 months. In August, the FDA approved the sNDA for the Gvoke Kit®, which will be available in March 2022.
•Keveyis®: Full-year pro forma 2021 net revenues for Keveyis were at the high end of the previously announced guidance of $38-40 million.
•Ogluo®: In December, Xeris’ commercialization partner, Tetris Pharma launched Ogluo® in the UK. Tetris plans to launch Ogluo in several European countries in 2022.
•Recorlev®: On December 30, 2021, The U.S. Food and Drug Administration (FDA) approved Recorlev for the treatment of endogenous hypercortisolemia in adult patients with Cushing’s syndrome for whom surgery is not an option or has not been curative. In February 2022, Xeris launched Recorlev and is now exclusively available through a specialty pharmacy. The Company has established Xeris CareConnection™, a comprehensive support program, which includes $0 co-pay for commercially insured patients, one-on-one support and education for patients, and reimbursement and access support.
Pipeline Programs
•Levothyroxine: Xeris anticipates having data from its Phase 1 single ascending dose study in the third quarter 2022.
•Exercise-induced Hypoglycemia (EIH): Xeris submitted an IND in February 2022 and recently received FDA clearance. The Company is actively planning a new phase 2 clinical program by the end of 2022 to further address the management of EIH in people with diabetes who use insulin.
•XeriJect™ Technology Platform Collaborations: Xeris has four ongoing evaluation projects with large pharmaceutical companies, which includes Merck, for the purpose of engineering ultra-high concentration, ready-to-use formulations.
Corporate Highlights
•On October 5, 2021, Xeris completed its acquisition of Strongbridge Biopharma plc.
•On January 2, 2022, Xeris entered into a Securities Purchase Agreement with Armistice Capital Master Fund Ltd. for $30.0 million and the issuance of 10,238,908 shares of common stock and warrants to purchase 5,119,454 shares of common stock at an exercise price of $3.223 per share.
•On March 8, 2022, Xeris entered into a senior secured term loan agreement with Hayfin Capital Management LLP to provide the Company with $150.0 million. On the closing date, Xeris drew down $100.0 million to repay its existing debt facility of $43.5 million with Oxford Finance LLC and Silicon Valley Bank and provide additional working capital to fund the Company’s business plan. An additional $50.0 million will be available during the 12-month period following the closing date.
Fourth Quarter and Full-year 2021 Financial Results
Net product revenues increased by $14.3 million or 201% and $29.1 million or 145% for the three and twelve months ended December 31, 2021, respectively, compared to December 31, 2020. The increases were due to an increased demand and the acquisition of a new product, Keveyis.
Cost of goods sold increased by $1.5 million or 43% and $4.0 million or 43% for the three and twelve months ended December 31, 2021, respectively, compared to December 31, 2020. The increases were due to increased sales, primarily offset by lower excess and obsolete.
Research and development expenses increased by $5.0 million or 97% and $4.2 million or 20% for the three- and twelve-months ended December 31, 2021, respectively, compared to December 31, 2020. Higher pharmaceutical process development and clinical service costs accounted for $3.7 million and $4.3 million of the increase for the three- and twelve-months ending December 31, 2021.
Selling, general and administrative expenses increased by $36.2 million or 201% and $52.0 million or 71% for the three- and twelve-months ending December 31, 2021, respectively, compared to December 31, 2020. The increases are primarily driven by costs associated with the Strongbridge acquisition of approximately $18.3 million and $24.4 million for the three-and twelve-months ending, respectively. Additionally, increases in sales force and commercial related expenses accounted for approximately $15.7 million and $16.8 million for the three- and twelve-months ending, respectively.
Net Loss for the fourth quarter ended December 31, 2021, was $50.8 million, or $0.42 per share, compared to a net loss of $21.9 million, or $0.41 per share, for the same period in 2020. For the full year ended December 31, 2021, the Company reported a net loss of $122.7 million, or $1.55 per share, compared to a net loss of $91.1 million, or $2.14 per share, for the same period in 2020.
Cash, cash equivalents, and short-term investments at December 31, 2021, was $102.4 million compared to $133.8 million at December 31, 2020. Total shares outstanding at February 28, 2022, was 135,523,511.
Financial Outlook
The Company is providing the following financial guidance:
•Net product revenue of $105 million to $120 million for full-year 2022
•Year-end 2022 cash, cash equivalents, and short-term investments in the range of $90 million to $110 million
•Cash flow breakeven by year-end 2023, which assumes performance is consistent with annual net product revenues guidance
Expectations for growth assume full access to health care provider facilities, as a continuation or escalation of access restrictions or lockdown orders resulting from the ongoing COVID-19 pandemic would adversely affect financial results.
Conference Call and Webcast Details
Xeris will host a conference call and webcast today, Thursday, March 10, 2022, at 8:30 a.m. Eastern Time. To pre-register for the conference call please use this link: https://www.incommglobalevents.com/registration/q4inc/9809/xeris-biopharma-fourth-quarter-2021-financial-results-conference-call-and-webcast/. After registering, a confirmation email will be sent, including dial-in details and a unique code for entry. The Company recommends registering a minimum of ten minutes prior to the start of the call. Following the conference call, a replay will be available until Thursday, March 24, 2022, at US:1 929 458 6194, US Toll Free: 1 866 813 9403, UK: 0204 525 0658, Canada: 1 226 828 7578, or all other locations: +44 204 525 0658 Access Code: 872042. To join the webcast, please visit “Events” on investor relations page of the Company’s website at www.xerispharma.com.
About Xeris
Xeris (Nasdaq: XERS) is a biopharmaceutical company developing and commercializing unique therapies for patient populations in endocrinology, neurology, and gastroenterology. Xeris has three commercially available products; Gvoke®, a ready-to-use liquid glucagon for the treatment of severe
hypoglycemia, Keveyis®, the first and only FDA-approved therapy for primary periodic paralysis, and Recorlev® for the treatment of endogenous Cushing’s syndrome. Xeris also has a robust pipeline of development programs to extend the current marketed products into important new indications and uses and bring new products forward using its proprietary formulation technology platforms, XeriSol™ and XeriJect™, supporting long-term product development and commercial success.
Xeris Biopharma Holdings is headquartered in Chicago, IL. For more information, visit www.xerispharma.com, or follow us on Twitter, LinkedIn, or Instagram.
Forward-Looking Statements
Any statements in this press release about future expectations, plans and prospects for Xeris Biopharma Holdings, Inc. including statements regarding the financial outlook for the full-year 2022, including projections regarding year-end 2022 cash estimates, the Company’s expectations regarding its cash flow breakeven projection, estimates and projections about the potential synergies in fiscal year 2022 resulting from the Strongbridge Biopharma acquisition, the availability of up to $50 million of additional funding under our credit agreement with Hayfin, the market and therapeutic potential of its products and product candidates, the expected launch by Tetris Pharma of Ogluo in several European countries in 2022, the expected availability of the Gvoke Kit® in March 2022, expectations regarding clinical data or results from planned clinical trials, including from the Phase 1 single ascending dose study in the third quarter 2022, the timing of clinical trials, including a new phase 2 clinical program to further address the management of EIH in people with diabetes who use insulin expected by the end of 2022, estimates and expectations regarding potential collaborations, including collaborations on the XeriJect™ Technology Platform, the timing or likelihood of regulatory approval and commercialization of its product candidates, the timing or likelihood of expansion into additional markets, the timing or likelihood of identifying potential development and commercialization partnerships, the potential utility of its formulation platforms and other statements containing the words “will,” “would,” “continue,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward-looking statements. Such risks and uncertainties include, but are not limited to, reliance on third-party suppliers for Gvoke®, Ogluo®, Keveyis and Recorlev, the regulatory approval of its product candidates, its ability to market and sell its products, failure to realize the expected benefits of the acquisition of Strongbridge Biopharma, the impact of the COVID-19 pandemic on Xeris, including impact on access to health care provider facilities, as a continuation or escalation of access restrictions or lockdown orders, changes in global, political, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax laws, regulations, rates and policies, future business acquisitions or disposals and competitive developments and the other risks described in our Quarterly Report on Form 10-Q and other reports we file from time to time with the SEC. These forward-looking statements are based on numerous assumptions and assessments made in light of Xeris’ experience and perception of historical trends, current conditions, business strategies, operating environment, future developments, and other factors it believes appropriate. By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. The factors described in the context of such forward-looking statements in this communication could cause Xeris’ plans with respect to Strongbridge, Xeris’ plans with respect to its products and product candidates, Xeris’ actual results, performance or achievements, industry results and developments to differ materially from those expressed in or implied by such forward-looking statements. Although it is believed that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct and persons reading this communication are therefore cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this communication. Additional information about economic, competitive, governmental, technological, and other factors that may affect Xeris is set forth in Item 1A, “Risk Factors,” in Xeris’ most recently filed Quarterly Report on Form 10-Q filed with the SEC, the contents of which are not incorporated by reference into, nor do they form part of, this communication. Any forward-looking statements in
this communication are based upon information available to Xeris, as of the date of this communication and, while believed to be true when made, may ultimately prove to be incorrect. Subject to any obligations under applicable law, Xeris does not undertake any obligation to update any forward-looking statement whether as a result of new information, future developments or otherwise, or to conform any forward-looking statement to actual results, future events, or to changes in expectations. All subsequent written and oral forward-looking statements attributable to Xeris or any person acting on behalf of any of them are expressly qualified in their entirety by this paragraph.
Investor Contact
Allison Wey
Senior Vice President, Investor Relations and Corporate Communications
awey@xerispharma.com
312-736-1237
XERIS BIOPHARMA HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(unaudited)
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Product revenues, net | $ | 21,359 | $ | 7,089 | $ | 49,280 | $ | 20,155 | |||||||||||||||
| Royalty, contract and other revenue | 70 | 83 | 310 | 280 | |||||||||||||||||||
| Total revenue | 21,429 | 7,172 | 49,590 | 20,435 | |||||||||||||||||||
| Costs and expenses: | |||||||||||||||||||||||
| Cost of goods sold, excluding amortization of intangible assets | 4,889 | 3,407 | 13,318 | 9,328 | |||||||||||||||||||
| Research and development | 10,082 | 5,110 | 25,160 | 20,921 | |||||||||||||||||||
| Selling, general and administrative | 54,179 | 17,998 | 125,718 | 73,732 | |||||||||||||||||||
| Amortization of intangible assets | 550 | — | 550 | — | |||||||||||||||||||
| Total costs and expenses | 69,700 | 26,515 | 164,746 | 103,981 | |||||||||||||||||||
| Loss from operations | (48,271) | (19,343) | (115,156) | (83,546) | |||||||||||||||||||
| Other income (expense) | (2,519) | (2,514) | (7,569) | (7,704) | |||||||||||||||||||
| Net loss before benefit from income taxes | (50,790) | (21,857) | (122,725) | (91,250) | |||||||||||||||||||
| Benefit from income taxes | — | — | — | 110 | |||||||||||||||||||
| Net loss | $ | (50,790) | $ | (21,857) | $ | (122,725) | $ | (91,140) | |||||||||||||||
| Net loss per common share - basic and diluted | $ | (0.42) | $ | (0.41) | $ | (1.55) | $ | (2.14) | |||||||||||||||
| Weighted average common shares outstanding - basic and diluted | 121,548,995 | 53,505,197 | 79,027,062 | 42,642,901 | |||||||||||||||||||
XERIS BIOPHARMA HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
| December 31, 2021 | December 31, 2020 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 67,271 | $ | 37,598 | |||||||
| Short-term investments | 35,162 | 96,190 | |||||||||
| Trade accounts receivable, net | 17,456 | 6,875 | |||||||||
| Inventory | 18,118 | 8,353 | |||||||||
| Prepaid expenses and other current assets | 4,589 | 3,196 | |||||||||
| Total current assets | 142,596 | 152,212 | |||||||||
| Property and equipment, net | 6,627 | 6,707 | |||||||||
| Goodwill | 22,859 | — | |||||||||
| Intangible assets, net | 131,450 | — | |||||||||
| Other assets | 829 | 232 | |||||||||
| Total assets | $ | 304,361 | $ | 159,151 | |||||||
| Liabilities and Stockholders’ Equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 8,924 | $ | 3,117 | |||||||
| Other accrued liabilities | 49,088 | 15,895 | |||||||||
| Accrued trade discounts and rebates | 15,041 | 5,984 | |||||||||
| Accrued returns reserve | 4,000 | 2,889 | |||||||||
| Other current liabilities | 1,987 | 322 | |||||||||
| Total current liabilities | 79,040 | 28,207 | |||||||||
| Long-term debt, net of unamortized debt issuance costs | 88,067 | 87,021 | |||||||||
| Contingent value rights | 22,531 | — | |||||||||
| Supply agreement liability, less current portion | 5,991 | — | |||||||||
| Deferred rent | 6,883 | 6,629 | |||||||||
| Deferred tax liabilities | 4,942 | — | |||||||||
| Other liabilities | 1,676 | 3,533 | |||||||||
| Total liabilities | 209,130 | 125,390 | |||||||||
| Total stockholders’ equity | 95,231 | 33,761 | |||||||||
| Total liabilities and stockholders’ equity | $ | 304,361 | $ | 159,151 | |||||||
Exhibit 99.2
XERIS ANNOUNCES $150M SENIOR SECURED TERM LOAN FACILITY WITH HAYFIN CAPITAL
$100M drawn down at close; repayment of existing term loan; near-term access to an additional $50M
Provides significant operating and financial flexibility
Cash flow breakeven expected by year-end 2023
CHICAGO, IL; March 10, 2022 – Xeris Biopharma Holdings, Inc. (“Xeris” or “the Company”) (Nasdaq: XERS), a biopharmaceutical company developing and commercializing unique therapies for patient populations in endocrinology, neurology, and gastroenterology, today announced it has entered into a senior secured term loan agreement ("debt facility") with funds managed by Hayfin Capital Management LLP (“Hayfin”) to provide Xeris with up to a total of $150 million of capital.
“We are very pleased to be partnering with Hayfin. This debt facility increases our financial strength and provides us with substantial resources by securing access to non-dilutive capital on attractive terms without over encumbering our balance sheet,” said Steven Pieper, Xeris’ Chief Financial Officer. “Together with the recent equity financing, which closed in January, Xeris has now added approximately $80 million of cash to the greater than $102 million of cash and investments already on our balance sheet at year-end 2021.”
Mr. Pieper continued, “This capital base and, if needed, the additional $50 million available for the next 12 months, provides the Company with significant operating flexibility to drive our rapidly growing commercial business as currently constructed to cash flow breakeven by year-end 2023, and thereafter produce increasing operating cashflow.”
Under the terms of the debt facility, Xeris drew down $100 million on the closing date to repay its existing term loan of $43.5 million with Oxford Finance LLC and Silicon Valley Bank, and the net proceeds will provide additional working capital to fund the Company’s business plan. An additional $50 million of the debt facility is available during the 12-month period following the closing date, which may be drawn by Xeris in up to three draws of no less than $10 million each, contingent upon, among other things, continued compliance with the financial covenants contained in the loan agreement. The maturity of the debt facility is five (5) years from the closing date, provided that such maturity date will be January 15, 2025 in the event that Xeris’ 5.0% outstanding convertible notes due 2025 are not extended, converted or refinanced prior to such date. Amounts borrowed under the debt facility bear interest at an annual rate equal to 9.00% plus the greater of (i) CME Term SOFR, subject to a credit spread adjustment, and (ii) one percent (1.00%) per annum. Xeris is entitled to make interest-only payments on a quarterly basis until the maturity date or earlier prepayment of the loan. During the term of the loan, Xeris is required to maintain certain minimum liquidity and revenue requirements.
On the closing date, Hayfin received warrants to purchase 1,315,789 shares of common stock of the Company at an exercise price of $2.28 per share, which will be exercisable until the seventh (7th) anniversary of the closing date.
Andrew Merrill, Managing Director of Healthcare at Hayfin said, “We are pleased to be supporting Xeris Biopharma through this senior secured loan agreement. The transaction is a testament to Hayfin’s specialist coverage and extensive lending relationships in the healthcare sector that enable us to provide capital and help businesses, like Xeris, meet their commercial objectives.”
Evercore acted as sole financial advisor to Xeris on this transaction.
About Xeris Biopharma
Xeris Biopharma Holdings, Inc. (“Xeris”) (Nasdaq: XERS) is a biopharmaceutical company developing and commercializing unique therapies for patient populations in endocrinology, neurology, and
gastroenterology. Xeris has three commercially available products; Gvoke®, a ready-to-use liquid glucagon for the treatment of severe hypoglycemia, Keveyis®, the first and only FDA-approved therapy for primary periodic paralysis, and Recorlev® for the treatment of endogenous Cushing’s syndrome. Xeris also has a robust pipeline of development programs to extend the current marketed products into important new indications and uses and bring new products forward using its proprietary formulation technology platforms, XeriSol™ and XeriJect™, supporting long-term product development and commercial success.
Xeris is headquartered in Chicago, IL. For more information, visit www.xerispharma.com or follow us on Twitter, LinkedIn, or Instagram.
About Hayfin Capital Management LLP
Founded in 2009, Hayfin Capital Management (“Hayfin”) is a leading alternative asset management firm with over €23 billion of assets under management. Hayfin focuses on delivering best-in-class risk-adjusted returns for its investors across its private credit, liquid credit and private equity solutions businesses.
Hayfin has a diverse international team of over 165 experienced industry professionals with offices globally, including headquarters in London and offices in Frankfurt, Madrid, Milan, New York, Paris, Luxembourg, San Diego, Singapore and Tel Aviv.
Further information can be found at hayfin.com.
Forward-Looking Statements
Any statements in this press release about future expectations, plans and prospects for Xeris Biopharma Holdings, Inc., including statements regarding plans, projections and estimates regarding the use of proceeds from the term loan facility, the Company's expectations regarding its cash flow break-even projection, the timing or likelihood of funding additional tranches under the term loan facility and other statements containing the words “will,” “would,” “continue,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the commercialization, marketing and manufacturing of Recorlev®, reliance on third-party suppliers for Gvoke®, Ogluo®, Keveyis®, and Recorlev®, the regulatory approval of its product candidates, its ability to market and sell its products, the impact of the COVID-19 pandemic on Xeris, changes in global, political, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax laws, regulations, rates and policies, future business acquisitions or disposals and competitive developments and the other risks described in Xeris’ Quarterly Report on Form 10-Q and other reports we file from time to time with the SEC. These forward-looking statements are based on numerous assumptions and assessments made in light of Xeris’ experience and perception of historical trends, current conditions, business strategies, operating environment, future developments, and other factors it believes appropriate. By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. The factors described in the context of such forward-looking statements in this communication could cause Xeris’ plans with respect to its products and product candidates, Xeris’ actual results, performance or achievements, industry results and developments to differ materially from those expressed in or implied by such forward-looking statements. Although it is believed that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct and persons reading this communication are therefore cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this communication. Additional information about economic, competitive, governmental, technological, and other factors that may affect Xeris is set forth in Item 1A, “Risk Factors,” in Xeris’ most recently filed Quarterly Report on Form 10-Q filed with the SEC, the contents of which are not incorporated by reference into, nor do they form part of, this communication. Any forward-looking statements in this communication are based upon information available to Xeris, as of the date of this communication and, while believed to be true when made, may ultimately prove to be incorrect. Subject to any obligations under applicable law, Xeris does not undertake any obligation to update any forward-looking statement whether as a result of new information, future developments or otherwise, or to conform any forward-looking statement to actual results, future events, or to changes in expectations. All subsequent written and oral forward-looking statements attributable to Xeris or any person acting on behalf of any of them are expressly qualified in their entirety by this paragraph.
Investor Contact:
Allison Wey
Senior Vice President, Investor Relations and Corporate Communications
awey@xerispharma.com
(312) 736-1237