Mast Therapeutics amends terms of $15 million Hercules debt facility

Company delays payment dates to coincide with clinical study results

By Devika Patel

Knoxville, Tenn., Feb. 29 – Mast Therapeutics, Inc. said it revised its $15 million debt facility agreement with Hercules Capital, Inc.

The amendment modified the loan to delay key dates in the agreement until after the company completes its phase 3 clinical study of vepoloxamer in patients with sickle cell disease. The prepayment condition now requires that $10 million be repaid on July 31 if positive results from the study have not been demonstrated by that date.

The capital raise requirement was eliminated and the amortization date was extended to July 1 from June 1 and, if the company gets positive data from the study by July 31, the amortization date will be extended to March 1, 2017. The company expects top-line data from the study in the second quarter.

In connection with the amendment, the company paid Hercules a $37,500 fee and amended the warrants held by Hercules so that the strike price has been reduced to $0.275.

The biopharmaceutical company is based in San Diego.

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