Filing
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM
CURRENT REPORT
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| Item 1.01. | Entry into a Material Definitive Agreement. |
On March 26, 2025 (the “Closing Date”), Savara Inc. (the “Company”) announced that it had entered into a Loan and Security Agreement (the “Loan Agreement”) with the lenders party thereto (the “Lenders”) and Hercules Capital, Inc., as administrative agent and collateral agent (the “Agent”). The Loan Agreement provides for the Company to borrow up to $200 million of term loans (the “Term Loan”) that may be advanced in multiple tranches.
The initial advance of $30 million under the Loan Agreement was drawn on the Closing Date and used to repay all outstanding obligations under the Company’s prior term loan with Silicon Valley Bank, to pay the Company’s expenses in connection with the Loan Agreement and for general corporate purposes. Further draws may be made by the Company as follows:
| • | Subject to FDA approval of the Company’s MOLBREEVI product candidate for the treatment of aPAP (the “Approval Milestone”), (a) up to $40 million on or prior to March 15, 2026, and (b) up to $40 million on or prior to December 15, 2026. |
| • | Subject to the Company achieving a trailing six months’ net product revenue from the sale of MOLBREEVI of at least 75% of an agreed upon revenue plan for any reporting period following March 31, 2027 (the “Revenue Milestone”), up to $20 million on or prior to December 31, 2027. |
| • | Subject to approval by the Lenders’ investment committees, up to $70 million. |
The Term Loan will mature on April 1, 2030 (the “Maturity Date”). Amounts outstanding under the Term Loan bear interest at a floating rate equal to (i) the greater of (a) the prime rate reported in The Wall Street Journal or (b) 6.0%, plus (ii) 1.45%, or, subject to the Company meeting the Revenue Milestone, 1.20% after the full fiscal quarter following such achievement. The Term Loan has an interest-only monthly payment through March 2028 (the “Interest-Only Period”) and beginning April 1, 2028, requires equal monthly installments of principal plus interest until the Maturity Date. If the Company achieves the Approval Milestone, the Interest-Only period will extend until the Maturity Date.
The Company’s obligations under the Loan Agreement are secured, subject to customary permitted liens and other agreed-upon exceptions, by a first-priority perfected security interest in all of the tangible and intangible assets of the Company, other than intellectual property, on which there is a negative pledge. The Loan Agreement includes customary affirmative and negative covenants, repayment and prepayment terms, representations and warranties, and events of default.
The Loan Agreement contains an affirmative covenant requiring the Company to maintain unrestricted cash under an account control agreement equal to 50% of the outstanding principal of the Term Loan beginning April 1, 2026 (the “Cash Requirement”), which will decrease to 35% upon achievement of the Revenue
Milestone and compliance with the Conditional Minimum Revenue Covenant (defined below). However, if the Approval Milestone has not been achieved, the Cash Requirement increases to 70% of the outstanding principal until the Approval Milestone is achieved. Notwithstanding the foregoing, the Cash Requirement will not apply during any period when the Company’s market capitalization exceeds $600 million.
Additionally, if the Company draws more than $50 million under the Term Loan, beginning nine months after achievement of the Approval Milestone, the Company will be required to have achieved, and to maintain, trailing six months of net product revenue of at least (i) 65% of a provided sales forecast or (ii) $100 million (“Conditional Minimum Revenue Covenant”). If the Company raises at least $75 million in net cash proceeds from the issuance of equity and/or upfront business development proceeds before June 30, 2026, the Conditional Minimum Revenue Covenant will not apply until 15 months after achievement of the Approval Milestone. Notwithstanding the foregoing, the Conditional Minimum Revenue Covenant will not apply during any period when the Company’s market capitalization exceeds $500 million, and the Company maintains minimum unrestricted cash under an account control agreement equal to 50% of the outstanding principal amount of the Term Loan.
The foregoing description of the Loan Agreement is qualified in its entirety by reference to the full text of the Loan Agreement, which the Company plans to file with its Form 10-Q for the period ended March 31, 2025.
| Item 1.02. | Termination of a Material Definitive Agreement. |
In connection with the initial draw under the Loan Agreement on March 26, 2025 and the use of proceeds for the full repayment of the Company’s obligations thereunder, the Company terminated that certain Amended and Restated Loan and Security Agreement, dated April 21, 2022, between the Registrant and its subsidiary, Aravas Inc., as borrowers, and Silicon Valley Bank.
| 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 under Item 1.01, “Entry into a Material Definitive Agreement,” is incorporated herein by reference.
| Item 7.01. | Regulation FD Disclosure. |
On March 26, 2025, the Company issued a press release announcing entry into the Loan Agreement. A copy of the press release is furnished as Exhibit 99.1 to this report.
The information in Item 7.01 in this Current Report on Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that Section, nor shall it be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits |
| Exhibit No. |
Description | |
| 99.1 | Press release dated March 26, 2025 | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL) | |
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 26, 2025 |
SAVARA INC. a Delaware corporation | |||
| By: | /s/ Dave Lowrance | |||
| Dave Lowrance Chief Financial & Administrative Officer | ||||
Exhibit 99.1
SAVARA ENTERS INTO NON-DILUTIVE DEBT FINANCING FOR UP TO $200M WITH HERCULES CAPITAL
— Includes $30M at Close to Refinance Existing Debt Facility —
LANGHORNE, PA – March 26, 2025 – Savara Inc. (Nasdaq: SVRA) (the Company), a clinical stage biopharmaceutical company focused on rare respiratory diseases, today announced that it has entered into a loan and security agreement with Hercules Capital, Inc. (NYSE: HTGC), for up to $200 million. Access to the additional capital strengthens Savara’s balance sheet following the submission of the Biologics License Application (BLA) to the U.S. Food and Drug Administration (FDA) for MOLBREEVI* as a treatment for autoimmune pulmonary alveolar proteinosis (aPAP). If priority review is granted by the FDA, MOLBREEVI could potentially be approved by the end of the year. The Company remains on track to file the Marketing Authorization Application for MOLBREEVI in Europe by the end of the year.
“We’re pleased to partner with Hercules Capital as we work to get MOLBREEVI, a potential first-in-class therapy for aPAP, approved in the U.S. and Europe,” said Matt Pauls, Chair and Chief Executive Officer, Savara. “This low-cost capital strategic financing further strengthens our financial position and provides additional flexibility following the BLA submission and as we prepare for a potential commercial launch of MOLBREEVI in the U.S.”
“We are proud to support Savara during this transformative time for the company,” said Tom Hertzberg, Managing Director, Hercules Capital. “As Savara approaches their first potential approval with MOLBREEVI, providing this capital underscores our dedication and commitment to helping bring novel and life-changing therapies to market.”
Under the terms of this loan agreement, $30 million was funded on the execution of the agreement and will be used to repay the Company’s existing $26.5 million debt facility. An additional $100 million will become available upon FDA approval of MOLBREEVI and certain other milestones. The final $70 million may be made available upon request by the Company and at the discretion of Hercules Capital. The loan agreement has a maturity of five years, with a 36-month interest-only period that can be extended to 60 months upon achieving FDA approval for MOLBREEVI. There are no warrants in connection to the agreement.
About Autoimmune Pulmonary Alveolar Proteinosis (aPAP)
aPAP is a rare lung disease characterized by the abnormal build-up of surfactant in the alveoli of the lungs. Surfactant consists of proteins and lipids and is an important physiological substance that lines the alveoli to prevent them from collapsing. In a healthy lung, excess surfactant is cleared and digested by immune cells called alveolar macrophages. Alveolar macrophages need to be stimulated by granulocyte-macrophage colony stimulating factor (GM-CSF) to function properly in clearing surfactant, but in aPAP, GM-CSF is neutralized by antibodies against GM-CSF, rendering macrophages unable to adequately clear surfactant. As a result, an excess of surfactant accumulates in the alveoli, causing impaired gas exchange, resulting in clinical symptoms of shortness of breath, often with cough and frequent fatigue. Patients may also experience episodes of fever, chest pain, or coughing up blood, especially if secondary lung infection develops. In the long-term, the disease can lead to serious complications, including lung fibrosis and the need for a lung transplant.
About Savara
Savara is a clinical stage biopharmaceutical company focused on rare respiratory diseases. Our lead program, MOLBREEVI, is a recombinant human granulocyte-macrophage colony-stimulating factor (GM-CSF) in Phase 3 development for autoimmune pulmonary alveolar proteinosis (aPAP). MOLBREEVI is delivered via an investigational eFlow® Nebulizer System (PARI Pharma GmbH) specifically developed for inhalation of a large molecule. Our management team has significant experience in rare respiratory diseases and pulmonary medicine, identifying unmet needs, and effectively advancing product candidates to approval and commercialization. More information can be found at www.savarapharma.com and LinkedIn.
| * | MOLBREEVI is the FDA and EMA conditionally accepted trade name for molgramostim inhalation solution. It is not approved in any indication. MOLBREEVI is a trademark of Savara Inc. |
Forward-Looking Statements
Savara cautions you that statements in this press release that are not a description of historical fact are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words referencing future events or circumstances such as “expect,” “intend,” “plan,” “anticipate,” “believe,” and “will,” among others. Such statements include, but are not limited to, statements related to the impact of Priority Review and the timing of FDA approval for MOLBREEVI, the anticipated timing of our MAA submission, that MOLBREEVI is a potential first-in-class therapy for aPAP, and statements related to the potential impact of the debt financing. Savara may not actually achieve any of the matters referred to in such forward-looking statements, and you should not place undue reliance on these forward-looking statements. These forward-looking statements are based upon Savara’s current expectations and involve assumptions that may never materialize or may prove to be incorrect. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties, which include, without limitation, the risks associated with our ability to
successfully develop, obtain regulatory approval for, and commercialize MOLBREEVI for aPAP; the risks and uncertainties related to the impact of widespread health concerns or changing economic or geopolitical conditions; the ability to project future cash utilization and reserves needed for contingent future liabilities and business operations; the availability of sufficient resources for Savara’s operations and to conduct or continue planned clinical development programs; and the timing and ability of Savara to raise additional capital as needed to fund continued operations. All forward-looking statements are expressly qualified in their entirety by these cautionary statements. For a detailed description of our risks and uncertainties, you are encouraged to review our documents filed with the SEC including our recent filings on Form 8-K, Form 10-K and Form 10-Q. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they were made. Savara undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as may be required by law.
Media and Investor Contact:
Savara Inc.
Temre Johnson, Executive Director, Corporate Affairs
ir@savarapharma.com
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