{"id":646725,"date":"2018-11-08T13:48:52","date_gmt":"2018-11-08T13:48:52","guid":{"rendered":"https:\/\/www.pm360online.com\/?guid=86d6f1a43fdb26f9fc63848081665df6"},"modified":"2018-11-08T13:48:52","modified_gmt":"2018-11-08T13:48:52","slug":"novelion-therapeutics-subsidiary-enters-into-term-loan-agreement-and-novelion-provides-business-update","status":"publish","type":"post","link":"https:\/\/www.pm360online.com\/novelion-therapeutics-subsidiary-enters-into-term-loan-agreement-and-novelion-provides-business-update\/","title":{"rendered":"Novelion Therapeutics Subsidiary Enters Into Term Loan Agreement and Novelion Provides Business Update"},"content":{"rendered":"

– New Aegerion loan facility, provided by existing bondholders, strengthens balance sheet and is expected to provide bridge to a potential comprehensive long-term capital restructuring<\/em><\/p>\n

– Company expects to achieve positive cash flow at Aegerion level by 2Q 2019 on full-year net product sales of between $145 and $160 million\u00a0<\/em><\/p>\n

– Financial advisors retained to advise on strategic process and capital structure review<\/em><\/p>\n

VANCOUVER, British Columbia, Nov. 08, 2018 (GLOBE NEWSWIRE) — Novelion Therapeutics Inc.\u00a0<\/strong>(NASDAQ:NVLN),\u00a0a biopharmaceutical company dedicated to developing new standards of care for individuals living with rare\u00a0metabolic\u00a0diseases (\u201cNovelion\u201d), announced that its subsidiary, Aegerion Pharmaceuticals, Inc. (\u201cAegerion\u201d), after soliciting third party lenders, has entered into a new secured financing facility with certain funds managed by Athyrium Capital Management (Athyrium) and Highbridge Capital Management, LLC (Highbridge) (the \u201cNew Lenders\u201d).<\/p>\n

The facility consists of $50.0 million in new secured first lien term loans that were funded to Aegerion in cash and $22.5 million of new secured term loans that were used, on behalf of Aegerion, to retire an equal amount of Aegerion\u2019s 2% convertible notes due August 2019, at par, held by certain funds managed by each of Athyrium and Highbridge. Additionally, approximately $21.2 million of the proceeds from the financing facility were used by Aegerion to repay in full the indebtedness outstanding under a secured loan facility entered into in March 2018, and $3.5 million of the proceeds from the financing facility were used to repay, in part, the existing secured loan facility made by Novelion to Aegerion. The remaining proceeds of approximately $25.3 million from the new secured financing facility, less approximately $3.5 million in fees and expenses required to be paid by Aegerion in connection with such facility, will be available to Aegerion for general corporate purposes.<\/p>\n

Jeff Hackman, Interim Chief Executive Officer, said, \u201cThe operational improvement and cost reduction initiatives that we executed throughout 2018 have made an impact on the stability of our business, and position Aegerion to become cash flow positive by the second quarter of 2019. This financing, which was sized to provide adequate runway to bridge to cash generation at the Aegerion level, also sets us on a path to a more comprehensive capital restructuring – our primary near-term goal. \u00a0We are encouraged by an ongoing productive dialogue with Aegerion\u2019s convertible debtholders to help us meet this goal, and are pleased that some of our largest bondholders showed further support for the Company by providing us with this new capital. As always, we will strive to continue to serve our patients and ensure that our important therapies continue to be made available to those in need.\u201d<\/p>\n

Hondo Sen, a Partner at Athyrium, said, \u201cWe believe that with a portfolio of important rare disease therapies there is a fundamental business opportunity to pursue.\u201d<\/p>\n

Jonathan Segal, Managing Director and Portfolio Manager at Highbridge, added, \u201cWe believe\u00a0 that through this financing we can help bridge the Company to a comprehensive long-term capital restructuring and allow it to take advantage of that business opportunity.\u201d<\/p>\n

Aegerion has engaged Moelis & Company LLC and AlixPartners, both of whom advised on the capital raise, to continue the comprehensive review of Aegerion\u2019s capital structure. Novelion and Aegerion have also engaged Evercore and Moelis & Company, respectively, to explore and advise the companies on all available financial and strategic options, such as a restructuring of Aegerion\u2019s outstanding convertible notes (including a restructuring that would likely involve a debt for equity swap), a possible sale or merger of Novelion or Aegerion, or the sale or other disposition of certain businesses or assets, including territorial licensing deals. The New Lenders engaged Ducera Securities LLC to advise on the capital raise. \u00a0<\/p>\n

The new facility has a maturity date of February 15, 2019, however, the maturity date may be extended, at Aegerion\u2019s option, to June 30, 2019 subject to the payment of a fee to the New Lenders under the new facility, the delivery to such lenders of a term sheet contemplating a sale of Aegerion or its assets that may be acceptable to Aegerion and its board of directors, the bring-down of certain representations and warranties of Aegerion, and the satisfaction of certain other conditions.\u00a0 While the funds received from the new facility allow the Company to meet its immediate operational needs and obligations, Aegerion may not be able to successfully refinance its approximately $36.8 million secured loan from Novelion, its remaining approximately $302.5 million principal amount of 2.0% convertible senior notes due August 15, 2019, or the new facility with an aggregate principal amount of $72.5 million.\u00a0 Effecting such a refinancing, or other wholesale recapitalization or other strategic alternative (and some of these alternatives could potentially lead Novelion and\/or Aegerion to seek certain protections afforded under law, including U.S. or Canadian bankruptcy codes) will be critical for us to continue to execute on our commercial strategy and pursue our goals and objectives, and we may not be successful in doing so.\u00a0<\/p>\n

The new facility was unanimously approved by the members of the board of directors of Novelion, all of whom are independent, and a special committee of Aegerion\u2019s board of directors, comprised solely of independent directors, each of which received advice from separate legal and financial advisors.<\/p>\n

Financial Update<\/strong><\/p>\n