Trinity Biotech plc (Nasdaq: TRIB) (the “Company”) today announced
it has entered into a definitive agreement to acquire the biosensor
and Continuous Glucose Monitoring (“CGM”) assets of privately held
Waveform Technologies, Inc. (“Waveform”) for $12.5 million in cash,
9 million American Depositary Shares (“ADSs”) of the Company and
additional contingent consideration.
“This acquisition marks the first step for
Trinity Biotech towards capitalizing on attractive new technology
horizons as we pursue a global leadership position in accessible
wearable biosensor technology and related data-driven wellness
analytics under our revised strategy, with an initial focus on
CGM,” said John Gillard, Chief Executive Officer. “We plan to begin
our journey in a de-risked manner, by using a CGM device that has
already received regulatory approval as our platform sensor
technology, which we intend to redesign and optimize for broad
adoption and then evolve this platform technology to measure and
analyse other valuable biomarkers and related datapoints. Our
vision is to develop a portfolio of technologies that can offer
users and clinicians valuable actionable health and wellness
insights based upon what is happening in, on and around the
body. The acquired technology permits needle-free
administration of the sensor resulting in built-in affordability
and we believe that our commercial partnership with Bayer will
facilitate market entry across key diabetes markets around the
globe. We feel confident in this strategy as Trinity has an over
twenty five year history of providing broad access to vital, high
quality, diagnostics across the globe, including
point-of-care HIV tests in Africa, and can leverage its extensive
experience in working with health systems, the World Health
Organization (“WHO”), non-governmental organizations (“NGOs”) and
global health funds to increase adoption of innovative diabetes
care tools worldwide,” he concluded.
Approved CGM offers differentiated
benefits versus main commercially available systems
Waveform, a developer of novel and proprietary
new technologies for diabetes care, received a CE Mark for its
Cascade CGM in 2019, which has since been commercially available in
Europe. Waveform will no longer sell the Cascade device and
the Company will not sell that device in its current form.
The Company intends to design a next generation CGM sensor using
Waveform’s platform technology and has secured additional funding
from Perceptive Advisors (“Perceptive) for the next stage of the
product’s development, further details of which are set out
below.
The Waveform CGM technology contains innovative
and proprietary aspects with important user benefits that include
needle-free insertion, which reduces pain and trauma at the
injection site, and a reusable applicator and transmitter, which
reduces the biological waste concerns associated with the currently
marketed single-use disposable systems. Notably, the reusable
nature of the applicator and transmitter should allow for a lower
cost of production of the redesigned CGM product compared to the
principal CGM market players, enabling the Company to target
additional markets where the existing CGM products are financially
prohibitive, which prevents broader adoption of this critical
technology.
Additionally, this innovative platform
technology should allow the Company to develop a broader suite of
wearable biosensors to measure and analyse important health and
wellness information, and the Company expects to further evolve its
biosensor to target other analytes and data points that represent
markers of health and function and make these devices available
more broadly around the globe.
The CGM technology acquired from Waveform has
been developed over many years and Waveform has granted a
perpetual, worldwide, non-exclusive license to DexCom, Inc. and its
affiliates, for some of the patents now being acquired by the
Company, but to which the Company retains the right to use and
exploit.
Amended credit agreement – greater
liquidity and lower interest rates
To fund the acquisition, the Company has entered
into an amended credit agreement (the “Amended Term Loan”) with its
existing main lender, Perceptive, an investment manager with
healthcare expertise. Under the Amended Term Loan, an
additional $22 million of funding has been made available to the
Company, with $12.5 million being used to acquire the Waveform
assets. The remaining $9.5 million is available for general
corporate purposes including for the further development of the CGM
and biosensor technologies. In addition, the Amended Term Loan
provides for additional liquidity of up to $6.5 million, that may
be drawn down by the Company between April and December 2024, and
can be used for general corporate purposes, thereby providing
further liquidity to fund the development of the CGM and biosensor
technologies.
The Amended Term Loan also immediately reduces
the annual rate of interest on the loan by 2.5% to 8.75% (the “Base
Rate”) plus the greater of (a) Term Secured Overnight Financing
Rate (SOFR) or (b) 4.0% per annum, and allows for a further 2.5%
reduction in the Base Rate to 6.25% once the outstanding principal
under the Amended Term Loan falls below $35 million. Additionally,
the Amended Term Loan reduces the early repayment penalty from a
range of 8% to 7% to 4.0% to 3.5%, dependent on timing of early
repayment, and also reduces the revenue covenants. The Amended Term
Loan matures in January 2026.
Waveform is part of a portfolio company of
Perceptive and the 9 million ADS being issued by the Company as
partial consideration for the acquisition of the Waveform assets
will be issued to Perceptive. In addition, in connection with
the Amended Term Loan, Perceptive will receive new warrants to
purchase an additional 2.5 million ADSs and the Company has agreed
to price these additional warrants and reprice the existing
warrants to purchase 2.5 million ADSs that were issued to
Perceptive under the original term loan, with an exercise price of
$0.44 per ADS.
As a result of these transactions, Perceptive
will be the largest investor in the Company, now with an additional
significant equity investment (together with an increased debt
investment).
Commenting, Sam Chawla of Perceptive stated that
“We are very excited to partner with the new Trinity Biotech
management team in developing a disruptive technology for CGM and
the broader biosensor and analytics markets. We believe that
Trinity Biotech’s plans, coupled with the Waveform technology, will
deliver a highly scalable and innovative biosensor business, with
an initial focus on the already well established and ever expanding
CGM market.”
Potential Additional Contingent
Consideration
Additional contingent consideration of up to $20
million may be payable upon the occurrence of certain events,
including:
- a $5 million payment if the (i) closing price of the Company’s
ADSs does not equal or exceed US$1.50 per ADS for at a least 20
consecutive trading days over the next twelve months and (ii)
average daily trading volume of the Company’s ADSs does not equal
or exceed 100,000 ADSs for 20 consecutive trading days over the
next twelve months, and
- 50% of certain proceeds received by our Company (up to a
maximum payment of additional consideration of $15 million) on our
entering into certain commercial partnering agreements with
certain insulin pump manufacturers in the next 24
months.
Conference Call
The Company will host a conference call on Wednesday, January 31
at 8:30 a.m. EST to discuss its recent Waveform acquisition. To
access the call, please dial 1-877-407-0784 (domestic) or
1-201-689-8560 (international) and use conference ID 13744109.
A live webcast and replay of the conference call is available
at:
https://viavid.webcasts.com/starthere.jsp?ei=1654009&tp_key=270fbd0272
Forward-Looking Statements
This release includes statements that constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995 (the “Reform Act”),
including but not limited to statements related to Trinity
Biotech’s cash position, financial resources and potential for
future growth, market acceptance and penetration of new or planned
product offerings, and future recurring revenues and results of
operations. Trinity Biotech claims the protection of the
safe-harbor for forward-looking statements contained in the Reform
Act. These forward-looking statements are often characterised by
the terms “may,” “believes,” “projects,” “expects,” “anticipates,”
or words of similar import, and do not reflect historical facts.
Specific forward-looking statements contained in this presentation
may be affected by risks and uncertainties, including, but not
limited to, our ability to capitalize on our purchase of the assets
of Waveform, our continued listing on the Nasdaq Stock Market, our
ability to achieve profitable operations in the future, the
impact of the spread of COVID-19 and its variants, potential excess
inventory levels and inventory imbalances at the company’s
distributors, losses or system failures with respect to Trinity
Biotech’s facilities or manufacturing operations, the effect of
exchange rate fluctuations on international operations,
fluctuations in quarterly operating results, dependence on
suppliers, the market acceptance of Trinity Biotech’s products and
services, the continuing development of its products, required
government approvals, risks associated with manufacturing and
distributing its products on a commercial scale free of defects,
risks related to the introduction of new instruments manufactured
by third parties, risks associated with competing in the human
diagnostic market, risks related to the protection of Trinity
Biotech’s intellectual property or claims of infringement of
intellectual property asserted by third parties and risks related
to condition of the United States economy and other risks detailed
under “Risk Factors” in Trinity Biotech’s annual report on Form
20-F for the fiscal year ended December 31, 2022 and Trinity
Biotech’s other periodic reports filed from time to time with the
United States Securities and Exchange Commission. Forward-looking
statements speak only as of the date the statements were made.
Trinity Biotech does not undertake and specifically disclaims any
obligation to update any forward-looking statements.
The foregoing description of the transaction
does not purport to be complete and is qualified in its entirety by
reference to the transaction documents which will be included in a
Form 6-K to be filed with the U.S. Securities and Exchange
Commission.
About Trinity Biotech
Trinity Biotech develops, acquires, manufactures
and markets diagnostic systems, including both reagents and
instrumentation, for the point-of-care and clinical laboratory
segments of the diagnostic market. The products are used to detect
infectious diseases and to quantify the level of Haemoglobin A1c
and other chemistry parameters in serum, plasma and whole blood.
Trinity Biotech sells direct in the United States, Germany, France
and the U.K. and through a network of international distributors
and strategic partners in over 75 countries worldwide. For further
information, please see the Company's website:
www.trinitybiotech.com
Contact: |
Trinity Biotech plcDes
Fitzgerald(353)-1-2769800 |
LifeSci Partners, LLCEric
Ribner(1)-646-751-4363E-mail
investorrelations@trinitybiotech.com |
Trinity Biotech (NASDAQ:TRIB)
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