Join our daily newsletter At The Bell to receive exclusive market insights
- AdAlta (1AD) is set to pocket a $4 million low-interest loan from the investment arm of the Victorian State Government
- The funding comes as part of Invest Victoria’s Research and Development (R&D) Cash Flow Loan initiative
- AdAlta will receive the $4 million loan in two tranches, with $2.4 million to be paid before the end of September and the rest in the March quarter of 2022
- The loan facility announced today is separate from the facility signed with Radium Capital back in June
- Shares in AdAlta close 6.38 per cent higher this afternoon at 10 cents each
Biotech business AdAlta (1AD) is set to pocket a $4 million low-interest loan from the investment arm of the Victorian State Government.
The funding comes as part of Invest Victoria’s Research and Development (R&D) Cash Flow Loan initiative, which is designed to support small to medium enterprises investing in R&D work that could be vital to Victoria’s future economy.
In AdAlta’s case, the loan will support the company’s lead AD-214 product, which is designed to treat fibrosis in different parts of the body using 1AD’s unique “i-body” technology.
AdAlta Managing Director and CEO Dr Tim Oldham said the company was “extremely grateful” to the Victorian Government for launching the R&D Cash Flow Loan initiative.
“This is an important contribution to the Victorian biotechnology
ecosystem, in which we are proud to be very active participants,” Dr Oldham said.
“Bringing forward funds from our R&D Tax Incentive rebate, and on attractive terms, enables us to materially extend our near-term cash runway to significantly progress value-adding research projects and reach value-driving inflection points.”
AdAlta will receive the $4 million loan in two tranches.
Under the first tranche, $2.4 billion will hit the company’s bank before the end of September. The second tranche of $1.6 million will be paid during the first quarter of 2022.
Under the R&D Cash Flow Loan initiative, interest rates on loans are variable at the Treasury Corporation of Victoria’s (TCV’s) 11am rate, which currently sits at 0.265 per cent.
The nature of the funding means it is non-dilutive for 1AD shareholders.
What’s more, the timing of the loan repayment will coincide with AdAlta’s R&D Tax Incentive (RDTI) rebate for the 2023 financial year. According to the company, the government loans are secured by the FY22 and FY23 RDTI refunds.
The loan facility announced today is separate from the facility signed with Radium Capital back in June.
According to AdAlta, the company’s i-body tech is built on the scaffold of a human protein but engineered with two loops that mimic the shape of antibodies found in sharks.
The result is an antibody that has better access to groves and cavities in the human body compared to traditional human antibodies.
Shares in AdAlta closed 6.38 per cent higher this afternoon at 10 cents each. The company has a $25.6 million market cap.
