SEATTLE, Feb. 9 /CNW/ - Oncothyreon Inc. (NASDAQ: ONTY) announced that
it has entered into a $12.5 million secured loan facility from GE
Capital, Healthcare Financial Services. An initial term loan with an
aggregate principal amount of $5.0 million was funded February 8,
2011. The remaining $7.5 million may be drawn at Oncothyreon's option
at any time prior to November 1, 2011, subject to the achievement of
certain clinical milestones and other customary conditions.
Oncothyreon intends to use the funds to support clinical development
activities, primarily the Phase 2 trials of PX-866, Oncothyreon's
irreversible inhibitor of the PI-3 kinase pathway. Oncothyreon
currently anticipates that the loan facility, if fully utilized,
together with existing cash and short term investments, will be
sufficient to fund the Company's operations into the second half of
"This loan facility will provide us with significant financial
flexibility to carry out our planned development of both PX-866 and
ONT-10, while we await the results of the START trial of Stimuvax®,"
said Robert L. Kirkman, M.D., President and Chief Executive Officer of
Oncothyreon. "We have already initiated two of four planned Phase 1/2
and Phase 2 trials of PX-866 and remain on track to file an
Investigational New Drug application for ONT-10 in the second half of
START is a randomized, controlled trial of Stimuvax, a therapeutic
vaccine targeting the tumor-associated antigen MUC1, in patients with
Stage III non-small cell lung cancer. The trial, initiated in early
2007, is being conducted by Merck KGaA and affiliates under an
exclusive license agreement with Oncothyreon.
The initial term loan accrues interest at a rate of 10.57% per year and
has a term of 42 months. During the first nine months of the initial
term loan, Oncothyreon is required to pay interest only. Oncothyreon
may prepay the initial term loan without penalty at any time during the
nine-month interest only period. In connection with funding of the
initial $5.0 million term loan, Oncothyreon issued warrants to purchase
48,701 shares of Oncothyreon common stock with an exercise price of
$3.08 per share.
Oncothyreon is a biotechnology company specializing in the development
of innovative therapeutic products for the treatment of cancer.
Oncothyreon's goal is to develop and commercialize novel synthetic
vaccines and targeted small molecules that have the potential to
improve the lives and outcomes of cancer patients. For more
information, visit www.oncothyreon.com.
About GE Capital, Healthcare Financial Services
With over $17 billion invested, GE Capital, Healthcare Financial
Services is a premier provider of capital and services to the
healthcare industry, with investments in more than 30 sub-sectors
including senior housing, hospitals, pharmaceuticals, and medical
devices. The Life Science Finance team has worked with more than 500 companies
throughout the United States, Canada and Europe. With a dedicated focus
on assisting life science companies large and small, from the first
venture round to post-IPO, the team has provided over $2.5 billion in
financing to the market. For more information, visit www.gecapital.com/healthcare.
In order to provide Oncothyreon's investors with an understanding of our
current intentions and future prospects, this release may contain
statements that are forward-looking. Any statements contained in this
press release that are not statements of historical fact may be deemed
to be forward-looking statements. Words such as "believes,"
"anticipates," "plans," "expects," "will," "intends," "potential,"
"possible" and similar expressions are intended to identify
forward-looking statements. These forward-looking statements include
our expectations regarding future expenses, clinical development
activities, the timing of clinical trial results and the use and
adequacy of cash resources.
Forward-looking statements involve risks and uncertainties related to
our business and the general economic environment, many beyond our
control. These risks, uncertainties and other factors could cause our
actual results to differ materially from those projected in
forward-looking statements, including the risks associated with the
costs and expenses of developing our product candidates, the adequacy
of financing and cash reserves on hand, changes in general accounting
policies, general economic factors, achievement of the results we
anticipate from clinical trials with our products and our ability to
adequately obtain and protect our intellectual property rights.
Although we believe that the forward-looking statements contained herein
are reasonable, we can give no assurance that our expectations are
correct. All forward-looking statements are expressly qualified in
their entirety by this cautionary statement. For a detailed
description of our risks and uncertainties, you are encouraged to
review the official corporate documents filed with the securities
regulators in the United States on U.S. EDGAR and in Canada on SEDAR.
Oncothyreon does not undertake any obligation to publicly update its
forward-looking statements based on events or circumstances after the
Additional information relating to Oncothyreon can be found on U.S.
EDGAR at www.sec.gov and on SEDAR at www.sedar.com.
SOURCE Oncothyreon Inc.
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