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Response Secures $12M Credit Facility

NEW YORK (GenomeWeb) – Response Genetics and SWK Funding today announced a credit agreement to provide Response with a term loan of up to $12 million.

Response has drawn the first tranche of $8.5 million of the new credit facility. A second tranche is conditional on the Los Angeles-based molecular diagnostics firm achieving a certain revenue milestone.

In a statement, Response Chairman and CEO Thomas Bologna said the proceeds from the financing will go toward growth initiatives including the commercialization of the newly launched ResponseDX: Tissue of Origin test, which the company acquired through its purchase last year of certain assets of Pathwork Diagnostics; its technical component/professional component testing service, in which Response processes a patient's sample while a pathologist interprets the results; and the Comprehensive Lung Profile service, which incorporates next-generation sequencing with fluorescence in situ hybridization and RNA biomarkers.

In connection with the closing of the first tranche, Response issued to SWK Funding, a wholly owned subsidiary of SWK Holding, a warrant to purchase an aggregate of 681,090 shares of common stock at an exercise price of $.936 per share. The loan matures on July 29, 2020, and accrues interest at an annual rate of 12.5 percent plus the Libor Rate.