" I would love to know the details behind Galeras financing. It would help investors value our bom drug."
There are enough details provided to at least support the notion that the investors have a firm belief that the market for the Galera drug is adequate to justify their investment and that it will be approved. The $70M in equity won't provide a return unless Galera goes public. The $80M in debt won't be paid back unless and until the drug is approved and marketed. Single digit royalties will require sales of over $800M to pay back that debt (and the "multiple" term suggests that they expect more).
"The financing includes a $70 million equity raise and an $80 million royalty financing payable from future sales. Per the terms of the royalty purchase agreement, Clarus will receive single-digit future commercial royalties from the sales of GC4419 and a related pipeline asset until the total royalty amount achieves an undisclosed multiple of the initial $80 million, upon which the royalty terminates."
They put up $150M and it's all at risk. I'm not sure if knowing that should "help investors value our bom drug" in a positive way or otherwise. We've heard opinions here suggesting that a simple swish and spit should easily trump an intravenous alternative and the common sense logic of that is undeniable, but the Galera investors appear not to be afraid of it.
I'd like to read the deal but as a private company we're stuck with the details in the PR.
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