scPharmaceuticals Secures Up to $125 Million in Non-Dilutive Financing from Perceptive Advisors

BURLINGTON, Mass., Aug. 12, 2024 — Pharmaceutical company scPharmaceuticals Inc. (Nasdaq: SCPH) has announced the completion of non-dilutive financings worth up to $125 million with Perceptive Advisors, a prominent investor in the life sciences sector. The funds will be used to refinance existing debt and support the continued commercialization of FUROSCIX, the company’s proprietary formulation of furosemide. This drug is used to treat congestion due to fluid overload in adult patients, including those with New York Heart Association (NYHA) Class IV chronic heart failure.

John Tucker, CEO of scPharmaceuticals, expressed enthusiasm about the financing, stating, “We have a unique opportunity with FUROSCIX to positively impact heart failure patient outcomes while reducing preventable healthcare costs, and these non-dilutive financings provide us with ample resources to continue to pursue those goals. We are excited to partner with Perceptive and look forward to working with them as we continue to grow as a company.”

Sam Chawla, Portfolio Manager of Perceptive Advisors' credit funds, echoed Tucker's sentiments, emphasizing the potential impact of FUROSCIX on the healthcare system. “By leveraging intervention opportunities both pre-hospital admission and post-discharge, FUROSCIX has the potential to reduce unnecessary hospital utilization, thereby improving patient quality of life while driving significant cost savings for healthcare payers. It is this kind of innovation that we strive to support, and we look forward to a long and mutually beneficial partnership.”

The financing package includes a $75 million senior secured term loan and a $50 million capped revenue interest financing agreement. The $75 million loan from Perceptive will provide an initial $50 million to refinance existing debt, with favorable terms including no mandatory principal repayments for five years and a reduced minimum cash requirement of $5 million. Interest on the loan accrues at the Secured Overnight Financing Rate (SOFR) plus 6.75%, with a SOFR floor of 3.25%.

In addition to the term loan, scPharmaceuticals also secured a $50 million revenue interest financing deal. Under this agreement, Perceptive will receive single-digit royalties on global net sales of FUROSCIX, capped initially at 1.6 times the purchase price and potentially up to 2.0 times under specific conditions. There are no “make whole” or “catch up” payments required, and the company retains the option to buy out the royalty agreement at 1.4 times the purchase price within the first two years, and at the cap thereafter.

“FUROSCIX® (furosemide injection) 80 mg/10mL for subcutaneous use is indicated for the treatment of congestion due to fluid overload in adult patients with chronic heart failure,” the company noted. It's critical to monitor patients for fluid, electrolyte, and metabolic abnormalities, especially those on higher doses, with inadequate oral electrolyte intake, or who are elderly. Potential side effects include dehydration, blood volume reduction, circulatory collapse, tinnitus, and hearing impairment.

scPharmaceuticals is committed to reducing healthcare costs and improving health outcomes by developing and commercializing products aimed at optimizing the delivery of infused therapies. Their lead programs include self-administration of IV-strength treatments for heart failure and infectious diseases.

Perceptive Advisors, founded in 1999, manages approximately $8 billion in assets and focuses on identifying and supporting promising healthcare technologies.

TD Cowen acted as the exclusive financial advisor for scPharmaceuticals, while legal advisories were provided by Latham & Watkins for scPharma and Morrison Foerster for Perceptive Advisors.

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