Achaogen Inc. (NASDAQ: AKAO) is in the middle of a critical product development program. It is developing a compound called plazomicin to help treat serious bacterial infections that arise from multi-drug resistance (MDR). This plazomicin program and several others require proper R&D financing to be successful. But, does AKAO have what it takes?
Fundraising for R&D and working capital
In a move to eliminate potential cash shortage problems, Achaogen Inc. (NASDAQ: AKAO) recently announced that it was raising additional capital through a private placement of securities that include equities and warrants to purchase shares.
As such, AKAO agreed with the investors that they will purchase about 8 million common shares of the company and warrants to purchase additional 2 million common shares. The transaction was targeted to raise about $25 million.
The management of Achaogen Inc. (NASDAQ: AKAO) said they were raising the amount to help with financing R&D program related to plazomicin and also for general corporate purposes that include working capital.
The completion of the securities fundraiser is expected to pave way for additional financing for Achaogen Inc (NASDAQ: AKAO). For example, the company entered into a $10 million loan funding arrangement with Solar Capital Ltd that was subject to the outcome of the recently completed securities fundraising.
Additionally, AKAO received a $20 million financing from Biomedical Advanced Research and Development Authority (BARDA) as part of their prior agreement.
CFO shakeup at Achaogen Inc. (NASDAQ: AKAO)
Achaogen Inc. (NASDAQ: AKAO) is not only adding more funds, but also talents. The company recently hired Tobin Schilke from Roche to be its CFO. Schilke will replace Derek Bertocci, who left the company late last year.
AKAO said that Schilke will receive a salary of $315,000 and bonus of 35% of the salary. Other benefits to the CFO include $35,000 signing bonus, $60,000 to cover relocation expenses and options to buy more than 126,000 shares in the company.
Looking at the latest development, it is evident that Achaogen Inc. (NASDAQ: AKAO) has what it takes to achieve its dreams.