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Akebia Therapeutics, Inc. (NASDAQ:AKBA), a biopharmaceutical company with a market capitalization of $471 million and annual revenue of $170 million, has amended its existing loan agreement with Kreos Capital VII (UK) Limited, extending the maturity date of its final loan tranche and drawing down $9.3 million in net proceeds. The amendment and financial transaction took place on Monday, February 3, 2025. According to InvestingPro data, the company has shown strong momentum with a 95% price return over the past six months, though analysts anticipate sales decline in the current year.
The original loan agreement, dated January 29, 2024, provided Akebia with a senior secured term loan facility totaling up to $55.0 million. This facility was divided into three tranches, with the first two tranches already funded in 2024. The final tranche of $10.0 million, initially set to expire on December 31, 2024, has now been extended to February 3, 2025, under the same terms, but with interest accruing from the original expiry date. With a current ratio of 1.52, InvestingPro analysis indicates the company maintains adequate liquidity despite challenging market conditions. Subscribers can access 5 additional ProTips and comprehensive financial analysis in the Pro Research Report.
In connection with the drawdown of the extended tranche, Akebia issued a warrant to Kreos Capital VII Aggregator SCSp, an affiliate of the lender, to purchase 1,153,846 shares of Akebia’s common stock at an exercise price of $1.30 per share. The warrant is exercisable for eight years from the date of issuance. With the stock currently trading at $2.16 and analyst price targets ranging from $4 to $10, this warrant issuance represents a significant potential opportunity for the lender.
The issuance of the warrant and the common stock upon its exercise were not registered under the Securities Act of 1933, as amended. They were offered pursuant to an exemption and are subject to resale restrictions under the Act. The details of the warrant are outlined in the form filed with Akebia’s annual report for the fiscal year ended December 31, 2023.
The transaction provides Akebia with additional capital that, after accounting for debt issuance costs, interest, fees, and expenses, totals $9.3 million. This financial move by Akebia Therapeutics is based on a press release statement and is part of the company’s broader financial strategy as it continues to operate within the pharmaceutical preparations industry.
In other recent news, Akebia Therapeutics has reported Q3 results, with total revenue decreasing to $37.4 million from $42 million in the same quarter of the previous year. The company’s net loss for the quarter was $20 million, attributed to increased spending on Vafseo’s prelaunch activities and a decline in revenue from its existing product, AURYXIA. The company has begun shipping Vafseo, an anemia treatment, in the U.S. for adult patients with chronic kidney disease (CKD) on dialysis. H.C. Wainwright has reiterated its Buy rating and $7.50 price target for Akebia, following the U.K.’s National Institute for Health and Care Excellence (NICE) endorsement of Vafseo as a treatment for symptomatic anemia caused by CKD in adult patients on maintenance dialysis. The firm is closely monitoring the potential regulatory pathway for Vafseo’s label expansion into non-dialysis CKD patients in the U.S., which depends on a Phase 3 cardiovascular outcome study of vadadustat expected to start enrolling around 1,500 patients in mid-2025. Akebia’s management estimates that current cash reserves and projected income will fund operations for at least the next two years.
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