NEW YORK (GenomeWeb News) – BG Medicine today announced it has entered into a secure loan facility for up to $15 million.
The loan facility is with GE Capital's Healthcare Financial Services and Comerica Bank. An initial $10 million was funded to the Waltham, Mass.-based company on Feb. 10. Subject to certain revenue milestones and other conditions being met, BG Medicine may draw an additional $5 million term loan on or before Feb. 10, 2013.
In a statement, Eric Bouvier, president and CEO of BG Medicine, said the loan facility will provide the firm with the financial flexibility to aid in the development and commercialization of the automated versions of the BGM Galectin-3 test for heart failure in the US and overseas, as well as the potential commercialization of the CardioScore diagnostic test for identifying patients at near-term risk of heart attack and stroke.
The company today also announced positive results from its pivotal validation study for CardioScore, which previously went by the name AMIPredict.
The funding will also go toward the development of additional indications for the BGM Galectin-3 test, Bouvier said.
Michael Rogers, executive vice president and CFO of the firm, said, "In evaluating several financing options relative to our business needs, we concluded that this loan facility was well-suited to provide the capital necessary to further our product development and commercialization plans while minimizing dilution to our current shareholders."
The initial term loan accrues interest at a rate of 8 percent, plus the higher of the three-month LIBOR rate or 1.25 percent per annum, and has a term of 42 months, BG Medicine said. No principal repayment is due for the first 12 months of the term.
In connection to the $10 million initial term loan, the company has issued warrants to purchase 36,657 shares of its common stock with an exercise price of $6.82 per share. If it draws the additional $5 million term loan, BG Medicine will have to issue additional warrants to the lenders, it said.
Also, BG Medicine today announced a study that found that CardioScore testing at baseline "significantly" predicted high risk of major cardiovascular events in both men and women during the study's median 2.5 year follow-up period, independent of cholesterol, blood pressure, or other conventional risk factors.
The company submitted a 510(k) application to the US Food and Drug Administration in December for CardioScore.