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PRESS RELEASE
11 April 2024
Press Release
Media Contacts:
IB Communications
BioSenic and its restructuring practitioner (Me Yves Brulard) submit a global restructuring plan covering the years 2024-2030 to the Enterprise Court of Nivelles
A final circular of the creditors on the basis of XX 83/23 of the Economic Law Code (ELC) will take place before the Court grants authorisation, in accordance with article XX 83/26 of the ELC, to submit the plan to the vote of each class of creditors and to homologation. The creditors will be aware of the plan, which by law contains information that could be privileged.
Mont-Saint-Guibert, Belgium, April 11, 2024 – BioSenic (Euronext Brussels and Paris: BIOS), the clinical-stage company specializing in serious autoimmune and inflammatory diseases and cell therapy announces that it has finalised a draft plan with the request referred to in Article XX 83/26 ELC with the Enterprise Court of Nivelles. Creditors will be notified to register their claims in RegSol. They will be able to consult this plan in order to then vote on the proposals made.
The proposed plan provides for differentiated treatment of creditors by class:
The plan does not affect the recent financing provided through the convertible bond facilities.
Some obligators have been offered to replace their outstanding loans granted to BioSenic for a total principal amount of EUR 7.5 million with new convertible bonds to be issued by BioSenic. The convertible bonds would be unsecured and would have a maturity date of 31 December 2030, which could be further extended by BioSenic for up to 24 months depending on its cash balance. An interest rate of 5% per year, payable annually, with an additional non-compounding interest of 3% per year that would be added to the principal amount upon conversion or repayment of a convertible bond. Under this proposal, which has already been agreed in principle, 200,000 outstanding warrants would be cancelled. The plan, if approved, would remove the conditions precedent previously agreed.
The plan provides that an outstanding EUR 8 million principal loan would be replaced by new convertible bonds to be issued by BioSenic. The convertible bonds would be unsecured and would have a maturity date of 31 December 2030, which could be further extended by BioSenic for up to 24 months depending on its cash balance. An interest rate of 5% per year, payable annually, with an additional non-compounding interest of 3% per year that will be added to the principal amount upon conversion or repayment of a convertible bond. If the plan is approved, 800,000 outstanding warrants would also be cancelled.
With regard to the ordinary creditors, the plan provides for a payment by BioSenic of 5% of the claim on the last day of the 5th year of the plan.
With respect to the lessor, the plan provides for the extraordinary part 100% immediately and the balance in ordinary.
Regarding the strategic creditors, the plan provides for 90% over 5 years depending on cash inflows and no later than the last day of the 5th year of the plan.
For the accessories employee, the plan provides for 99% immediately.
The plan provides, for the very useful creditors, for 50% within 2 years.
Regarding the InterCos debts, the plan provides for 5% immediately.
Finally, with regard to the shareholders, the plan provides for the allocation of subscription rights, the terms of which will be determined at a later date by BioSenic.
The plan includes a participation clause at the reorganisation value, due on the last day of the 5th year following the homologation of the plan on the basis of the average share price over the preceding 90 days. This participation amount – to be deducted from the company's own financing capacity for projects in the 5th year, with trials to be started or even maintained on new indications – will be due on the last day of the 5th year following the homologation of the plan, and will be assessed on the basis of the average share price over the preceding 90 days: the average share price will have to reach the level observed for the shares of BioSenic in 2017 while a Phase III was ongoing (JTA004). At that time, the share price stood at EUR 10. If this level is reached, the participation of every creditor will be increased by 10% of the debt written off.
The increase/participation could reach 20 % of the debt written off if the price reaches EUR 18, 30% if the price reaches EUR 25 and 50% if the price reaches EUR 50, which is highly unlikely for a biotech with no turnover, as indicated in a 2022 MIT study (Singh et al 2022, PloS-ONE, open access article, "The reaction of sponsor stock prices to clinical trial outcomes: An event study analysis").
The plan is based on the non-binding offer of funding from a fund, in particular, to finance a Phase 3 clinical trial on Graft versus Host disease (as announced by BioSenic, via press release, on 8 December 2023). BioSenic will announce, by way of a new press release, the results of the votes of the creditors and after the terms and conditions that will be decided by the Court, as well as the Court's decisions as soon as they are known. This judgement would significantly reduce the debt.
François Rieger, PhD, President of the Board and CEO of the BioSenic Group, said:
"An effort to reorganise the assets of BioSenic has now been accompanied by a proposed adjustment to the company's liabilities. This should enable our biotech to regain momentum by focusing its efforts on its most promising projects, in particular a Phase 3 clinical trial for the treatment of chronic Graft versus Host disease. These projects, now at the clinical trial stage, will generate value for all those who have invested financially in the adventure that is now taking shape. We expect decisive results for patients suffering from chronic diseases of the immune system, for which there is currently no medical need.".
About BioSenic
BioSenic is a leading biotech company specializing in the development of clinical assets issued from its Medsenic’s arsenic trioxide (ATO) platform. Key target indications for the autoimmune platform include graft-versus-host-disease (GvHD), systemic lupus erythematosus (SLE), and now systemic sclerosis (SSc).
Following the merger in October 2022, BioSenic combined the strategic positionings and strengths of Medsenic and Bone Therapeutics. The merger specifically enables Medsenic/Biosenic to develop an entirely new arsenal of various anti-inflammatory and anti-autoimmune formulations using the immunomodulatory properties of ATO/oral ATO (OATO).
BioSenic is based in the Louvain-la-Neuve Science Park in Mont-Saint-Guibert, Belgium. Further information is available at http://www.biosenic.com.
About BioSenic's technology platforms
The ATO platform has immunomodulatory properties with fundamental effects on the activated cells of the immune system. One direct application is its use in autoimmunity to treat in its chronic, established stage. Chronic GvHD is one of the most common and clinically significant complications affecting long-term survival of allogeneic hematopoietic stem cell transplantation (allo-HSCT), a curative treatment for patients with serious blood diseases, including cancers.
BioSenic’s intravenous ATO formulation, Arscimed(R), has orphan drug designation status by FDA and EMA, and it has shown good safety and significant clinical efficacy for skin, mucosae, and the gastrointestinal tract in an early Phase 2a study. The company is planning a confirmatory international Phase 3 study with its oral ATO (OATO) formulation. OATO will also target moderate-to-severe forms of SLE. BioSenic is also developing a new IP-protected composite ATO formulation for the treatment of SSc, a serious chronic disease that affects skin, lungs or vascularization, and has no current effective treatment. Preclinical studies on pertinent animal models support the launch of a Phase 2 clinical trial.
ALLOB is an allogeneic cell therapy platform made of differentiated, bone marrow-sourced mesenchymal stromal cells (MSCs), which can be stored at the point-of-use in hospitals. ALLOB represents a unique and proprietary approach to organ repair, and specifically to bone regeneration, by turning undifferentiated MSCs from healthy donors into bone-forming cells at the site of injury. BioSenic is studying the results of a recent Phase 2b trial, to optimise the efficacy of ALLOB by determining the best timing for therapeutic intervention and seeking partners to continue the development of promising underlying therapy strategies.
The company is also exploring partnerships at all levels for its JTA-004viscosupplement for a severe inflammatory subtype of osteoarthritis, following a positive post hoc analysis of Phase 3 data demonstrating safety and efficacy in selected osteoarthritic patients in support of any possible licensing