Egalet Corporation (Nasdaq: EGLT), a fully integrated specialty pharmaceutical company focused on developing, manufacturing and commercializing innovative treatments for pain and other conditions, today announced the closing of the second $40 million tranche of the $80 million secured debt financing announced August 31, 2016. The second tranche was triggered by the approval from the U.S. Food and Drug Administration of ARYMO™ ER (morphine sulfate) abuse-deterrent, extended-release (ER) tablets C-II on January 9, 2017. In addition, the company announced that it will issue options to purchase stock to employees in Egalet's recently internalized salesforce.
Egalet plans to use the net proceeds from this transaction to support commercialization of ARYMO ER and for general corporate purposes. Morgan Stanley & Co. LLC acted as sole placement agent for the transaction. Additionally, Egalet has sold a royalty right to the note purchasers, representing a right to receive an aggregate 1.5% royalty on net sales of ARYMO ER.
"With the additional $40 million, we believe we are well positioned to commercialize ARYMO ER and continue our momentum with SPRIX® Nasal Spray and OXAYDO®," said Bob Radie, president and chief executive officer. "In addition, the options issued provide further incentive to our salesforce as we transition them in as Egalet employees to market our three products."
Inducement Grants
On January 16, 2017 the compensation committee of the company's board of directors approved a grant to 62 new employees, as a result of internalizing the salesforce, of inducement options to purchase an aggregate of 160,000 shares of Egalet common stock, with a grant date of February 1, 2017. The stock options were granted as inducement equity awards pursuant to the company's 2017 Inducement Plan, which was approved by the company's board of directors in December 2016, and the equity grants were made as inducements material to the new employees entering into employment with the company under Rule 5635(c)(4) of the Nasdaq Global Market.
Each stock option will have an exercise price per share equal to the closing trading price on the effective date of grant, will have a ten-year term and will vest over four years, with 25% vesting on the one-year anniversary of the effective date of the grant and 1/48 of the shares vesting monthly thereafter, subject to the new employee's continued employment with the company on such dates.
About Egalet
Egalet, a fully integrated specialty pharmaceutical company, is focused on developing, manufacturing and commercializing innovative treatments for pain and other conditions. Egalet has three approved products: ARYMO™ ER (morphine sulfate) extended-release tablets for oral use only –CII, developed using Egalet's proprietary Guardian™ Technology, OXAYDO® (oxycodone HCI, USP) tablets for oral use only –CII and SPRIX® (ketorolac tromethamine) Nasal Spray. Using Guardian Technology Egalet is developing a pipeline of clinical-stage, product candidates including Egalet-002, an abuse-deterrent, extended-release, oral oxycodone formulation for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate. Guardian Technology can be applied broadly across different classes of pharmaceutical products and can be used to develop combination products that include multiple active pharmaceutical ingredients with similar or different release profiles. For full prescribing information on ARYMO ER, including the boxed warning and medication guide, please visit arymoer.com. For full prescribing information on SPRIX, including the boxed warning and medication guide, please visit sprix.com. For full prescribing information on OXAYDO, please visit oxaydo.com. For additional information on Egalet, please visit egalet.com.
