Axsome Therapeutics, Inc. (NASDAQ: AXSM) has announced a significant financial development, entering into a $570 million term loan and revolving credit facility with funds managed by Blackstone Life Sciences and Blackstone Credit & Insurance. This new facility represents an increase of over $200 million from the previous one, providing the company with enhanced financial flexibility.
The $570 million facility comprises a $500 million term loan facility and a $70 million revolving credit facility. At the closing of the agreement, Axsome drew down a total of $120 million from the term loan facility, which was utilized to retire the previous term loan with Hercules Capital.
Under the terms of the new term loan facility, the company has the option to draw an additional $250 million, with a further $200 million available subject to the approval of Blackstone. The facility bears interest at a calculated SOFR variable rate plus 4.75% for the term loan and SOFR variable rate plus 4.0% for the revolving credit facility. It matures in May 2030 and includes an interest-only payment period of 60 months.
Additionally, Blackstone has invested $15 million in Axsome common stock at a price calculated based on the 30-day volume weighted average, further solidifying their partnership.
Furthermore, Axsome Therapeutics announced the retirement of its previous term loan with Hercules Capital, highlighting the improved financial terms and the expected reduction in interest expense.
The company's CEO, Dr. Herriot Tabuteau, expressed enthusiasm about the new agreement with Blackstone, emphasizing the expanded total available credit facility and the significant reduction in the cost of capital. This development underscores Axsome's commitment to accelerating time to profitability and enhancing shareholder value, while advancing its mission to improve the lives of patients living with serious CNS disorders.
Axsome's partnership with Blackstone reflects the latter's confidence in the former's operational and financial agility to support its next phase of growth. The investment is designed to reinforce the company's strategic objectives and provide customized and flexible financing solutions to help leading biopharma companies achieve their goals.
The company has emphasized its commitment to advancing its mission of solving some of the brain’s biggest problems to enable patients and their loved ones to flourish. This significant financial development is a testament to Axsome's continued progress and growth within the biopharmaceutical industry. Following these announcements, the company's shares moved 2.23%, and are now trading at a price of $110.16. For more information, read the company's full 8-K submission here.
