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Faced with the slow adoption of Trulance, his constipation medication, Synergy Pharmaceuticals $ SGYP has practically thrown in the towel, claiming that he was not planning to receive bids of purchase consistent with his current market value and that he hoped to renegotiate his important loan agreement.
According to Synergy, two years before the approval and launch of Trulance in 2017, the company was evaluating strategic options, including partnerships and a sale. Having received no offers that matched his expectations, the New York-based drug manufacturer chose to go it alone. In May, however, Synergy announced that it was conducting a strategic review and was also seeking to renegotiate its term loan agreement with CRG, announced in September 2017 in the form of a $ 300 million debt financing. dollars structured in senior secured loans.
Until now, Synergy has not managed to modify its agreement with CRG. The loan agreement contains "a minimum liquidity commitment stating that the absence of relief from MAFs may not be satisfied. Synergy is continuing its discussions with CRG to obtain relief from its commitments and at the same time the company is seeking financing solutions … but there is no guarantee that the company will be able to obtain CRG's consent or obtain such financing … in which case the company could default under the term loan. agreement and may have to continue or accelerate strategic alternatives, including the possibility of seeking bankruptcy protection, "Synergy said in a statement released on Friday.
Shares plunged 67% after Synergy released the press release at market close on Thursday.
By January 2017, Trulance had obtained FDA approval for Chronic Idiopathic Constipation (CIC) and had reported $ 16.8 million during the year. Synergy had also launched Poop Troop, a series of animated emoticons designed to encourage conversation about CIC's impact.
After getting approval for the Irritable Bowel Syndrome with Constipation (IBS-C) in January, sales are expected to increase. But Lizness, approved by Ironwood Pharma's $ IRWD 2012, stayed in its lead position, and Trulance did not achieve the expected results, in line with Synergy's expectations.
Synergy now expects Trulance's net revenue for 2018 to be in the range of $ 42 million to $ 47 million, well below the $ 61 million minimum revenue covenant stipulated in its term loan agreement. MAF. In fact, the situation could be worse for Synergy starting in 2019, when Ardelyx's drug tenapanor $ ARDX, currently under review by the FDA, is expected to hit the market.
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