IRLAB Therapeutics - SEK55m loan enhances headroom past key catalysts

IRLAB Therapeutics has announced a new loan facility of up to SEK55m with Formue Nord to support its development programmes. Provided the facility is fully drawn down, we estimate it will extend IRLAB's cash runway through Q324, past key inflection points (top-line results from the pirepemat Phase IIb trial and the results from the end of Phase II meeting with the FDA, both expected in H124). Considering the market environment, we view the transaction as practical as it provides increased liquidity with limited potential dilution. The first tranche (SEK30m) is paid out on signing the agreement and the second (SEK25m) can be drawn down at IRLAB's discretion between 22 May and 22 August 2024, provided the company's market cap exceeds SEK550m (c 40% premium over the current SEK389m market cap). The facility is due for repayment on 22 May 2025 and SEK10m of the loan can be converted to equity. We will update our estimates for this new funding but anticipate no material changes to our valuation.

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