InhaleRx Pens AU$38.5 Million Funding Agreement with Clendon Biotech Capital

Australian healthcare company InhaleRx (ASX:IRX) has entered into a AU$38.5 million funding facility with Melbourne-based Clendon Biotech Capital to cover clinical trial costs for its key projects.

InhaleRx currently has two main projects: its pain asset IRX-211 and its mental health asset IRX-616a.

According to the company, IRX-211 is designed to target breakthrough cancer pain, while IRX-616a focuses on offering fast and effective relief for individuals suffering from panic disorder.

“This partnership ensures that InhaleRx can move forward with the next stages ... including the associated non-clinical work and trial drug manufacturing costs for the IRX-211 and IRX-616a drug development plans through to the completion of Phase 2 clinical trials,” the company said in a press release on October 18.

InhaleRx will use the AU$38.5 million from Clendon to sustain both of its projects until they reach the pivotal Phase 3 stage within the next two to three years. During this time, the company will remain responsible for covering operational and corporate overhead costs that are not included in the scope of its agreement with Clendon.

Repayment terms are tied to project completion, and the funding facility has an interest rate of 15 percent per year.

“(InhaleRx) must repay the money owed in cash, but may use the proceeds from the exercise of the options to make the repayments,” InhaleRx says in its release. Clendon will also receive options in InhaleRx as part of the deal.

InhaleRx received the final clinical study report for a Phase 1 trial of IRX-211 in July. The company was encouraged by the results and is set to commence a Phase 2 trial for the drug toward the end of this year.

Also in July, the US Food and Drug Administration temporarily suspended InhaleRx's investigational new drug application for a Phase 1 trial involving IRX-616a. The company said it is working address the concerns identified.

Investigational new drug status isn't required for Phase 1 and 2 clinical trials in Australia.

Don’t forget to follow us @INN_Australia for real-time news updates!

Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.