Regulus Therapeutics Inc. (RGLS) recently announced restructuring of a term loan by Oxford LLC. With a condition to pay $10 million against loan principal before April 30, 2021, company will have to pay only the interest for up to seven months. The Principal Paydown Event is subject to be adjusted through proceeds from Sanofi against product sales and achievement of certain goals.
If the company fails to comply with this condition, it has to pay principal as well as accrued interest. That will be according to previously agreed terms and will be payable as arrears from May 1, 2021.
In case of company succeeds to comply with the Principal Paydown Event on or before July 31, 2021. It is eligible for an interest only period through December 31, 2021. In that case company will recommence payment of principal and accrued interest from January 1, 2022.
At the same time, Regulus also came amending its terms with Sanofi about incentives to achieve certain business goals. Those potential milestones are around the development of its miR-12 compound program. Regulus has sold additional material related to that compound to Sanofi for an amount of $1 million.
As previously agreed terms, Regulus was eligible to receive $10 million subject to achievement of enrollment milestone. After the amendment, the company will get additional $4 million if it completely transfers the material sold to Sanofi and gets verification thereon. The company will also be eligible to get additional $5 million upon completion of enrollment process of that.
In case of enrollment milestone occurs before transfer and verification milestone, then the company will get collective additional amount of $9 million for both milestones. Achieving additional development milestone will make Regulus eligible to receive $25 million. The milestone is related to make Sanofi able to develop miR-12 compounds.