Mainstay Medical secures €13m in debt financing

Dublin-based medical devices firm, Mainstay Medical has received a boost to its attempts to commercialise a breakthrough treatment for chronic back pain by securing $15m (€13m) in debt financing.

The fresh funding will go towards further pushing Mainstay’s ReActiv8 implantable device product for sufferers of chronic back pain, towards market.

The money is being provided by IPF Partners, a leading financier focused on the European healthcare market, and will be available in three tranches.

The terms of the overall agreement included a requirement for Mainstay to hold a minimum cash balance of $2m until it achieves revenue targets, initially $1m.

An initial $4.5m tranche is immediately available, with the Dublin firm free to draw down the second and third installments after meeting certain test and regulatory milestones for its product.

Each tranche has a repayment term of 60 months from drawdown, with interest-only payments for the first 12 months.

The facility does not include any preferential right to participate in a future financing of Mainstay.

Speaking yesterday, Mainstay’s chief executive, Peter Crosby said management is pleased to have secured the new facility.

“These funds strengthen our financial position and allow us to continue building momentum towards commercialisation of ReActiv8,” he added.

Mainstay took a dual listing on the ESM market in Dublin, and Paris’ Euronext exchange last year.

As of the end of last December, the company had cash on hand of $18.3m; but an expanding workforce and money spent on further clinical trial testing of the ReActiv8 product pushed operating costs up by nearly $3m to just over $11m for the last year.