On October 1, 2014 Ignyta reported that it has secured a $31 million term loan facility from Silicon Valley Bank (Press release Ignyta, OCT 1, 2014, View Source [SID:1234500806]). Under the loan facility, the company received initial funding of $21 million, approximately $11 million of which was used to repay the company’s existing loan with Silicon Valley Bank, and has a conditional option to receive an additional $10 million.
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"This loan facility strengthens our balance sheet as we aggressively expand the clinical development of our highly promising lead program, RXDX-101, and continue the development of the rest of our precision medicine oncology pipeline," said Jonathan Lim, M.D., Chairman and CEO of Ignyta. "We appreciate the support Silicon Valley Bank has provided to us as we have grown."
The loan agreement, in addition to customary conditions, provides that the second tranche of $10 million may be drawn down by Ignyta at any time prior to September 30, 2015, provided that Ignyta has initiated the Phase IIa portion of the ongoing STARTRK-1 Phase I/IIa clinical study of its lead product candidate RXDX-101.
Ignyta will be required to pay interest on borrowings at the fixed, per-annum rate of 8.56% on a monthly basis through October 31, 2015. Thereafter, the company will be required to repay the principal plus interest in 30 equal monthly installments. The number of months of interest-only payments and the number of months over which the principal will be amortized will each be increased by six months if the second tranche has been drawn down or the company has raised sufficient funds through the offering of its capital stock, in each case prior to October 31, 2015.