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Jun 5, 2008

Exelixis Secures $150M Commitment

  • Deerfield Management will provide Exelixis with up to $150 million in financing through a flexible credit facility. The funds can be drawn at any time over the next 18 months in $15 million increments.

    Funds drawn will be repayable five years after signing of the facility agreement and can be repaid in common stock, subject to certain restrictions, or cash at any time during the term of the agreement.

    Exelixis will pay a quarterly commitment fee at a rate of 2.25% per annum, and amounts drawn will accrue interest until maturity at a rate of 6.75% per annum. Deerfield was issued warrants to acquire 1,000,000 shares of Exelixis common stock at an exercise price of $7.40 per share, representing a 20% premium to the average closing stock price over the last 10 business days, the companies report.

    Exelixis is under no obligation to draw on the facility and can terminate the facility agreement without penalty at any time. In the event that Exelixis draws on the facility agreement, Exelixis would be required to issue warrants to acquire up to an additional 10,000,000 shares of its common stock.

    “We expect that the next few months will provide key insights into our pipeline, the future of our existing collaborations, and potential new collaborations,” George A. Scangos, Ph.D., president and CEO. “The Deerfield facility gives us the time to see our way through this period of major pipeline and business milestones and puts us in a position of strength as we advance our various partnering discussions.”

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Scientifically Studying Ecstasy

MDMA (commonly known as the empathogen “ecstasy”) is classified as a Schedule 1 drug, which is reserved for compounds with no accepted medical use and a high abuse potential. Two researchers from Stanford, however, call for a rigorous scientific exploration of MDMA's effects to identify precisely how the drug works, the data from which could be used to develop therapeutic compounds.

Do you agree that ecstasy should be studied for its potential therapeutic benefits?

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