Newron secures 30M SwFr long-term standby equity line

Newron Pharmaceuticals, an Italian R&D company focused on novel central nervous system and pain therapies, has entered into an equity funding agreement with YA Global Investments to support the continued longer term development of its product candidates. Under the terms of the deal, Newron has the option to take up YA Global's commitment to subscribe and pay for newly-issued Newron shares to a total value of up to 30.0 million Swiss francs ($24.8 million) over a period of 36 months at the sole and exclusive discretion of the Italian company.

The accord enables Newron to ask YA Global, at any given time during the 36 month term, to subscribe to newly-issued shares in regular tranches of up to 400,000 francs, as well as advance tranches of up to 2.0 million francs. YA Global can either accumulate these shares up to a maximum holding in Newron of 9.99% or place them in the market, and is committed not to short sell or enter into any hedging transactions related to Newron stock.

Luca Benatti, Newron's chief executive, stated: "management believes that this instrument provides us with sensible financial flexibility in the current market environment. As our product pipeline progresses towards commercialization, a strengthened financial position increases our strategic options to create value. The control and flexibility afforded by this additional source of financing will give Newron the option to raise significant funds over a period of three years entirely at our discretion."