Galectin Therapeutics (NASDAQ:GALT), the leading developer of therapeutics that target galectin proteins, today announced it entered into a $10 million unsecured line of credit facility with stockholder and new director Richard E. Uihlein.
"I have been a shareholder and supporter of Galectin Therapeutics for many years, and I am very encouraged by the Company’s positive efficacy results in its NASH-CX trial for patients with cirrhosis due to NASH. My desire to provide this credit line was to assist the Company with favorable financing while it continues to progress the drug towards the goal of bringing therapy and hope to a large number of patients who have no currently approved treatment options," said Richard E. Uihlein.
Borrowings under the credit line are at the Company’s discretion through December 31, 2018. Advances under the line of credit bear interest at the applicable Federal Rate for short term loans, which is currently 1.51%. Principal and interest are due on December 31, 2019 unless prepaid sooner in the sole discretion of the Company. The Company granted one million stock purchase warrants exercisable at $5.00 per share in connection with entering the line of credit. Half of the warrants vested at signing and half vest ratably with borrowings under the facility.
Richard E. Uihlein was elected to the board of directors of the Company at its annual meeting of stockholders on December 14, 2017. Mr. Uihlein also owns directly or indirectly more than 5% of the outstanding common stock in the Company.
"Mr. Uihlein is a tremendous supporter of the Company. We very much appreciate his commitment to serve on our board, and we thank him for this additional investment. By eliminating pressure to potentially consummate a very dilutive financing, we now believe we have financing resources to cover currently planned expenditures through 2018 and can focus on strategic plans regarding advancing GR-MD-02 for treatment of NASH patients with cirrhosis without varices," said Dr. Peter G. Traber, M.D., CEO and CMO of Galectin Therapeutics.
About NASH Cirrhosis
NASH cirrhosis is the final stage in the progression of non-alcoholic steatohepatitis (NASH), a disease of the liver which affects millions of people in the U.S. and worldwide. The liver inflammation and cell death seen in NASH eventually causes progressive scarring the liver, which eventually can result in liver cirrhosis. While the early stages of NASH can be treated by changes in lifestyle, such as losing weight and exercising, once the disease progresses to NASH cirrhosis there is no treatment available short of a liver transplant. Of the total number of individuals in the world felt to have NASH, it is predicted that NASH cirrhosis will eventually kill 20 million of those people.
One of the results of NASH cirrhosis is an increase in blood pressure in the portal vein that brings blood and nutrients from the digestive tract through the liver and then out to the rest of the body. As the scarring effect of cirrhosis on the liver progresses, blood flow through the liver becomes more difficult, increasing the blood pressure in the portal vein, creating varying degrees of portal hypertension. Eventually, this increase in blood pressure causes the veins connected to the liver to dilate and form varices, similar to what is seen in varicose veins. In the NASH-CX clinical trial GR-MD-02 was seen to have a statistically significant effect of portal vein pressure on patients who had NASH cirrhosis but had yet to develop portal pressure severe enough to form esophageal varices.
About the NASH-CX Trial
The aim of the NASH-CX clinical trial was to evaluate the safety and efficacy of GR-MD-02 in patients with well-compensated NASH cirrhosis. The trial was a randomized, double-blind, placebo-controlled Phase 2b clinical trial which enrolled 162 NASH cirrhosis patients into the treatment phase; NASH-cirrhosis was confirmed both by liver biopsy and by confirmation of an elevated hepatic venous pressure gradient (HVPG). Enrolled patients received either 8 mg/kg or 2 mg/kg of GR-MD-02 or placebo every other week for 52 weeks, for a total of 26 doses. The primary study endpoint was a reduction in HVPG. Patients treated with GR-MD-02 were evaluated to determine the change in HVPG as compared to patients treated with placebo...
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