NASDAQ-listed pharma business collapses into administration
NASDAQ-listed 4D Pharma collapsed into administration on Friday after its American funder called in its loans.
Joint administrators James Clark and David Pike from Interpath Advisory said they will “try to stabilise” the pharmaceuticals business while assessing options.
Leeds-based 4D Pharma had a secured credit facility in place for up to $30m with global life sciences funder Oxford. It had drawn down $12.5m when the facility was agreed last July with further tranches dependent on the achievement of certain milestones.
But 4D Pharma needed significant amounts of cash to fund its day-to-day trading and had been unsuccessful in trying to secure additional funding for several months, blaming the “significant uncertainty currently affecting the global capital markets”.
4D Pharma had discussed “a potential funding alternative” with Oxford on Thursday evening but on Friday morning the funder demanded immediate repayment of the outstanding balance of $13.86m, which included interest and fees.
The company, which is dual-listed on the Alternative Investment Market and NASDAQ, was unable to make the repayment and suspended trading. Within hours, Oxford had put 4D Pharma into administration.
4D Pharma’s subsidiaries – 4D Pharma Research, 4D Pharma Cork, 4D Pharma León, and 4D Pharma Delaware – which run its facilities in Scotland, Ireland, Spain, and the US, are not part of the administration.
The group employs more than 100 people, although the plc company is directly responsible for about 15 employees.
Clark, managing director at Interpath Advisory, said: “Since its inception, 4D Pharma has been at the forefront of innovation around the development and use of live biotherapeutic products, but unfortunately has been impacted by the growing uncertainty gripping the capital markets.
“Our intention is to try to stabilise the company in the immediate term whilst we assess options for the business.”
4D Pharma focuses on the development of live biotherapeutics, an emerging class of medicines which contain a live organism – such as a bacterium – applicable to prevention, treatment or cure of a disease.
The company has six clinical programs underway, including therapeutic trials for conditions including cancer, asthma and Parkinson’s disease.
4D Pharma’s share price had already fallen 90% since September 2020, reducing its market value to £30m when its shares were suspended.