CAMBRIDGE, Mass.– Seres Therapeutics, Inc. (Nasdaq: MCRB), a leading microbiome therapeutics company, today announced that it has entered into a new $250 million senior secured debt facility (“Term Loan Facility”) provided by funds managed by Oaktree Capital Management, L.P. (“Oaktree”). The Company drew the first tranche of $110 million at closing, with three additional tranches available. These additional tranches include $90 million that will be available in two tranches of $45 million each based upon the achievement of certain applicable VOWST sales targets, and an additional $50 million will be available to the Company at Oaktree’s discretion to support potential future business development activities.
Of the $110 million advanced by Oaktree at closing, approximately $53 million retires outstanding debt, and after deducting fees and expenses, the net proceeds to the Company are approximately $50 million. The Term Loan Facility carries an interest rate equal to the three-month secured overnight financing rate (“SOFR”) plus 7.875%, with the interest rate capped at 12.875% per annum. The Term Loan Facility is expected to mature six years from funding and carries an initial interest only period for the first three years, which may be extended to six years based upon the achievement of certain VOWST sales targets.
“This flexible debt offering from Oaktree provides Seres with support for the upcoming commercial launch of VOWST, the first orally administered microbiota-based therapeutic to prevent recurrence of C. difficile Infection (CDI) in adults following antibacterial treatment for recurrent CDI (rCDI), as well as for the advancement of Seres’ additional microbiome therapeutic candidates, including SER-155. Oaktree is one of the top capital providers for innovative biopharma companies, and we look forward to working closely together,” said David Arkowitz, Chief Financial Officer at Seres.
“With the approval of VOWST, Seres has firmly established itself as a leader in the exciting microbiome therapeutics field. We see a tremendous opportunity for VOWST and Seres’ multiple innovative pipeline programs to fill significant unmet medical needs across a variety of therapeutic areas. We are delighted to be collaborating with the Company during its next phase of growth and playing a role in bringing an entirely new treatment modality to patients,” said Aman Kumar, Co-Portfolio Manager of Life Sciences Lending at Oaktree.
Oaktree is a leading provider of debt and royalty financing for the global life sciences industry. Since 2020, funds managed by Oaktree have committed over $3.0 billion across 31 investments for companies across the healthcare spectrum.
Morgan Stanley & Co. LLC acted as sole structuring agent to the Company. Latham & Watkins LLP served as legal counsel to Seres. Sullivan & Cromwell LLP served as legal counsel to Oaktree.
