Sparks - IRLAB Therapeutics

IRLAB Therapeutics has renegotiated its loan terms with FENJA Capital, allowing it to extend duration of the SEK55m loan from May 2025 to 31 December 2025 and potentially to 30 June 2026 (for an additional fee of 2% of the loan amount). Furthermore, the loan value can be enhanced by an additional SEK20m under certain pre-defined conditions. Financing terms are similar to the previous loan (set-up fee of 5% with an annual interest rate of STIBOR+10%), with certain obligatory conditions, such as issue to warrants to the lender and potentially a rights issue to service the debt. In addition, the company has also raised SEK22.4 in shareholder loans, from four major shareholders, which carry a 5% set-up fee and a 1.5% monthly interest rate. Loan maturity is 31 December 2025, with the right to extend to 30 June 2026 for an additional fee of 3% of the outstanding loan amount.

Despite the high servicing costs, we see this recent financing as practical, as it allows the company with non-dilutive funding and additional liquidity to manage operations past key upcoming inflection points (including the Phase IIb top-line data for pirepemat), as well as greater flexibility to negotiate terms with potential partners for mesdopetam. Should both the shareholder loan and additional SEK20m loan from Fenja Capital be fully utilised, we estimate IRLAB will have an operational runway into Q425 (versus end-Q125 previously).