[Funding] iCure Raises Funds for Early CB Redemption through Rights Offering to Shareholders

Allocation of 0.65 New Shares per 1 Old Share in Europe... Plan to Raise 80 Billion KRW
Early Redemption Request Possible for 4th CB in February Next Year
Sales Increase Expected Following Full-Scale Sales of Dementia Treatment 'Donerion'

[Asia Economy Reporter Hyungsoo Park] iQure is raising funds to repay convertible bond (CB) debt through a rights offering. Since the stock price has significantly declined compared to when the '4th Convertible Bond (CB)' was issued in February last year, the possibility of early redemption request (put option) has increased.

According to the Financial Supervisory Service's electronic disclosure system on the 23rd, iQure will conduct a rights offering followed by a general public offering of forfeited shares by issuing 12.33 million new shares. The planned issue price of the new shares is 6,490 KRW, and it is expected to raise a total of 80 billion KRW. New shares will be allocated at 0.655 shares per existing share. The subscription date for existing shareholders is December 5, and the issue price will be finalized on December 1.

Among the funds raised through the rights offering, 47.7 billion KRW will be allocated for CB repayment. The conversion price of the 4th CB is 20,842 KRW, which is higher than iQure’s current stock price. Bondholders can exercise the put option starting February 2 next year.

Previously, in February last year, iQure issued 50 billion KRW worth of 4th CB to secure funds for U.S. clinical trials and research and development (R&D) costs for the donepezil patch, as well as factory expansion. At that time, the conversion price was 61,890 KRW, and it was allowed to be adjusted down to 80% of the initial conversion price in case of stock price decline. Subsequently, the conversion price was adjusted reflecting stock price drops and bonus issues, and just before the submission of the securities report, the conversion price was lowered to 20,842 KRW. Considering the current stock price is below 10,000 KRW, the likelihood of conversion request is low.

Among the raised funds, 22.3 billion KRW will be used to expand the pharmaceutical factory. Through facility investment, the company plans to enhance overall quality and cost competitiveness in the pharmaceutical business. The remaining funds will be used as operating capital for clinical trial expenses, R&D for candidate substances, audit and advisory fees, among others.

iQure has continued R&D to develop donepezil, an Alzheimer's dementia treatment, in patch form. It completed Phase 3 clinical trials in February last year and obtained domestic and export product approval in November last year. Last month, it launched the product under the name 'Donerion' through Celltrion Pharm. It is expected that sales will increase once full-scale sales begin next year.

On a consolidated basis for the first half of the year, the debt ratio was 147.3%, up 29 percentage points from 118.3% at the end of last year. Borrowings stood at 74.1 billion KRW, with a borrowing dependency ratio of 36.1%.

Chairman Youngkwon Choi, the largest shareholder, will acquire 30% of the allocated new shares. The participation scale of related parties has not yet been determined. After the rights offering, the shareholding ratio of the largest shareholder and related parties may decrease from 17.44% to 12.49%.

This content was produced with the assistance of AI translation services.