Zealand Pharma Announces Seven-Year, $200 Million Financing Agreement with Oberland Capital

On Dec 15, 2021

Zealand Pharma A/S a biotechnology company focused on the discovery, development and commercialization of innovative peptide-based medicines, announced a financing agreement with Oberland Capital Management LLC (“Oberland Capital”). The agreement includes an upfront payment of $100 million in exchange for a 7-year, interest-only secured note (the “Secured Note”).

In addition to the $100 million upfront payment, Zealand will receive the following:

$50 million in exchange for an additional note with terms and conditions consistent with the Secured Note, available at Zealand’s option any time prior December 31, 2023, following receipt of approval of glepaglutide for the treatment of short bowel syndrome (SBS) by the Food and Drug Administration;
Up to $50 million in exchange for an additional note on terms to be mutually agreed upon, available at Zealand’s option any time prior to June 30, 2023, to acquire products and/or companies;
The interest rate for the Secured Note is 6.0% plus 3-month LIBOR or 0.25%, whichever is greater
Oberland Capital will also receive a low single-digit royalty obligation on net sales during the term of the agreement.

“This new funding from Oberland Capital enables us to continue to selectively invest in our robust clinical-stage pipeline, which includes multiple programs in Phase 3 trials across a range of metabolic and gastrointestinal diseases, as well as in our pre-clinical pipeline,” said Matthew Dallas, Senior Vice President and Chief Financial Officer at Zealand Pharma. “Importantly, in addition to the initial $100 million upfront payment, a further $50 million becomes available on the potential approval of glepaglutide for the treatment of SBS, where we anticipate Phase 3 pivotal trial results in Q3 of 2022.”

“We are delighted to support Zealand in its mission to develop and commercialize medicines for patients in need of new treatments for metabolic and gastrointestinal diseases,” said William Clifford, Partner at Oberland Capital. “The Zealand team has a clear mission of delivering five commercialized products by 2025, aiming to change the lives of patients, and we are excited to partner with them on this path forward.”