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  • 28 July 2020
    Sequana Medical announces 7.3 million debt financing and provides clinical update

    Sequana Medical NV (Euronext Brussels: SEQUA) (the “Company” or “Sequana Medical“), an innovator in the management of fluid overload in liver disease, malignant ascites and heart failure, today announces it has secured a €7.3 million debt financing through subordinated loan agreements, of which €1.4 million will be convertible for new shares of the Company.

    The funding extends the cash runway into H2 2021 and enables the Company to reach key clinical milestones in its North American liver and global heart failure programmes. A detailed financial update will be provided in the half year results which will be announced on 3 September 2020.

    “We are pleased to have successfully secured this additional funding at attractive terms, especially given the current volatile financial markets”, said Kirsten Van Bockstaele, Chief Financial Officer at Sequana Medical. “With this financing in place, we are well-placed to continue to execute on our strategy and to reach our next value inflection points, expected in the coming months.”

    The Company also announces an update on timings of its clinical development programmes, following the impact of the ongoing COVID-19 global health crisis.

    The POSEIDON North American pivotal study of the alfapump in recurrent and refractory ascites due to liver cirrhosis has resumed its recruitment activities in Canada. In the U.S., while travel restrictions and restrictions on non-essential hospital visits and procedures are still in place, patients continue to be screened for recruitment into the study. Subject to further developments related to the COVID-19 pandemic, patient recruitment in the U.S. is expected to resume early in Q4 2020 with interim results expected in Q1 2021. The Company anticipates to complete enrolment by the end of 2020 with a primary endpoint read-out by the end of 2021. The POSEIDON study aims to support the approval of the alfapump in the U.S. and Canada, with an FDA submission expected in H1 2022.

    Enrolment of the RED DESERT repeated dose proof-of-concept study of the alfapump DSR (Direct Sodium Removal) for the treatment of diuretic-resistant heart failure patients has also resumed and the Company now expects to report interim results in Q4 2020 and top-line results in Q1 2021. The RED DESERT interim results in Q4 2020 are intended to support the discussions with the U.S. FDA to reach agreement on the plans for a U.S. feasibility study of the alfapump DSR in patients with volume overload due to heart failure, which is expected to be initiated in H2 2021.

    Ian Crosbie, Chief Executive Officer at Sequana Medical, said: “As Sequana Medical swiftly resumes its operations following the clinical trial enrolment delays related to COVID-19, we are pleased to report that the interest from patients and the medical community in our innovative treatment approaches remains extremely high. The quality of our team and of our products, combined with this new financing, will enable us to continue the strong momentum in our development programs. We are excited at the prospect of bringing these breakthrough devices to patients as soon as possible and to continue to deliver strong value to all our stakeholders.”

    Details of the €7.3 million debt financing

    The Company entered into subordinated loan agreements with several shareholders, including PMV/z-Leningen, for an aggregate principal amount of €7.3 million, of which €1.4 million can be converted by the lenders into new shares of the Company in the event of a future equity financing or sale of the Company.

    The loans have a term of 36 months and are repayable in full upon expiry of the term. The loans bear an interest of 6% per annum, except that the convertible portion of the loans bear an interest of 5% per annum. The interest is payable only upon expiry of the term of the loans. The price per share at which the convertible portion of the loans can be converted in the event of an equity financing or sale of the Company will be equal to 75% of the price of the Company’s shares as will be reflected in the equity financing or sale.

    The loan by PMV/z-Leningen is part of the action plan of the Flemish Region to support businesses as a result of the COVID-19 crisis.