Lexington, Mass.-based T2 Biosystems signed a maximum $69 million funding deal with the Health and Human Services Office of the Assistant Secretary for Preparedness and Response’s Biomedical Advanced Research & Development Authority for the development of its MR-based diagnostic for sepsis-causing pathogens and antibiotic-resistance genes.
The cost-sharing contract calls for BARDA to an initial $6 million during the initial base period and up to $63 million more if the remaining seven option periods are exercised to August 2024.
The agreement also covers T2’s direct-from-blood panel to detect biothreat pathogens, according to an SEC filing.
In separate releases, the company also announced the refinancing of a term loan and a contract with a group purchasing organization. The interest-only payment period on a term loan agreement with CRG Servicing was extended by a year, with principal payments slated to begin in March 2022. The restructuring also reduced the minimum revenue targets for 2020-2022 to below T2’s own forecast, the company said.
T2 issued additional warrants to CRG for more than 568,000 shares at $1.55 apiece, exercisable anytime before Sept. 9, 2029, and reduced the exercise price to $1.55 on previously issued CRG warrants for some 529,000 shares exercisable before Dec. 30, 2026.
“The restructuring of our term loan agreement with CRG is an important financial update that provides increased balance sheet flexibility and supports our ability to execute on our growth strategy,” chairman & CEO John McDonough said in a news release. “We believe the updated agreement provides sufficient runway to continue driving adoption of T2Bacteria and T2Candida in the near-term, while also executing on our development pipeline to further expand our market opportunity. We are pleased with ongoing support from CRG and for their collaborative partnership.”
TTOO shares opened down -5.8% at $2.83 apiece today.