BACTERIN INTERNATIONAL HOLDINGS, INC. ("the "Company" or "Bacterin") develops, manufactures and markets biologics products to domestic and international markets. Bacterin's proprietary methods optimize the growth factors in human allografts to create the ideal stem cell scaffold and promote bone and other tissue growth. These products are used in a variety of applications including enhancing fusion in spine surgery, relief of back pain with a facet joint stabilization, promotion of bone growth in foot and ankle surgery, promotion of skull healing following neurosurgery and cartilage regeneration in knee and other joint surgeries.
Bacterin International seals $25 mln non-dilutive financing with OrbiMed
The maker of bone graft material and anti-microbial coatings for medical applications said the financing will allow the company to execute its growth strategy through anticipated profitability.
Under the terms of the deal, Bacterin has initially received $20 million, and can draw down another $5 million based on "mutually agreed" revenue objectives prior to December 31, 2013.
The company said it got net proceeds of around $10 million after repayment of existing debt, as well as other transaction-related fees and expenses.
The new funds will be used for general working capital. No equity securities or warrants were issued as part of the deal, Bacterin added.
"Today's funding marks an important milestone for the company as we entered into a financing agreement with OrbiMed," said Bacterin chairman and CEO Guy Cook.
"With this financing, we don't anticipate the need for additional working capital in our pursuit of achieving profitability.
"OrbiMed's recognition of Bacterin's unique technology and strong growth profile enabled us to secure this non-dilutive financing option. The future and long-term opportunity for Bacterin products, in multi-billion dollar addressable markets, is today stronger than ever."
Bacterin's proprietary methods optimize the growth factors in human allografts to create a stem cell scaffold to promote bone, subchondral repair and dermal growth.
These products are used in a number of applications including enhancing fusion in spine surgery, relief of back pain, bone growth in foot and ankle surgery, cranial healing following neurosurgery, and subchondral repair in knee and other joint surgeries.
The company's medical device unit also develops and licenses bioactive coatings for medical device applications, designed to inhibit biofilm formation and microbial contamination.
"We are very pleased to partner with Bacterin and offer a non-dilutive capital solution to help the company execute its growth strategy," said a managing director on the royalty opportunities team at OrbiMed, Tadd Wessel.
For the second quarter, Bacterin's revenue increased nine per cent to $8.2 million, compared to $7.5 million in the same period a year ago.
The company said hospital accounts increased to 768 facilities, compared to 756 facilities in the first quarter of 2011.
Bacterin reported earlier this month it swung to a profit of $730,517, or two cents per share for the quarter, compared to a net loss of $405,297, or one cent per share, a year earlier.
In early July, it signed its fourth national government pharmaceutical organization (GPO) contract, a three-year agreement with Premier Healthcare Alliance, one of the nation's largest GPOs, serving over 2,600 hospitals and more than 84,000 other healthcare sites that represent over $43 billion in annual purchasing power.
It also exited its backorder status on a large production push, and expects increased production to continue throughout the second half of 2012. The company reiterated its 2012 revenue guidance of $35 to $40 million.