GENFIT's Strategic Moves: Royalty Financing and Debt Overhang Resolution

GENFIT, a late-stage biopharmaceutical company dedicated to improving the lives of patients with rare and life-threatening liver diseases, has recently announced two significant strategic moves: a non-dilutive royalty financing agreement with HealthCare Royalty (HCRx) and a plan to repurchase its outstanding 2025 OCEANE bonds. These moves aim to strengthen the company's financial outlook, extend its cash runway, and eliminate its convertible debt overhang.



The royalty financing agreement with HCRx provides GENFIT with up to €185 million in non-dilutive capital, consisting of an upfront payment of €130 million and two additional instalments of €30 million and €25 million, respectively, based on near-term milestones being met. HCRx will be compensated and repaid out of a portion of the royalties that GENFIT is eligible to receive from its partner Ipsen. The cumulative payment to HCRx is capped at a maximum value and subject to time-limits, after which all future royalties will revert back to GENFIT.

GENFIT retains the right to receive any regulatory, commercial, and sales-based milestone payments under the Ipsen agreement, including the €26.55 million milestone expected in 2025 pending a third pricing and reimbursement approval of Iqirvo® (elafibranor) in a major European market. The proceeds from the royalty financing agreement will further strengthen the development of GENFIT's Acute-on-Chronic Liver Failure (ACLF) pipeline.

Concurrently, GENFIT plans to propose a repurchase of the outstanding 2025 OCEANE bonds, aiming to completely eliminate its convertible debt overhang. This move will provide GENFIT with more financial flexibility, improve its shareholder confidence, and enhance its ability to execute its strategic plans.

In conclusion, GENFIT's strategic moves, including the non-dilutive royalty financing agreement with HCRx and the plan to repurchase its outstanding 2025 OCEANE bonds, demonstrate the company's commitment to strengthening its financial position, extending its cash runway, and eliminating its convertible debt overhang. These moves will enable GENFIT to further develop its ACLF pipeline and deliver on its R&D pipeline objectives.