Acura Pharmaceuticals Inc., a specialty pharmaceutical company focused on innovating abuse deterrent drugs, said that on Oct. 5, it restructured debt obligations by receiving an additional $1.8 million loan from John Schutte.
The Palatine company also and said it's retiring in full its senior secured debt with Oxford Finance for a payment of $1.5 million.
Schutte's loans to the company total $4 million. Pursuant to the terms of the debt, after the retirement of the Oxford Finance debt, the company is required to grant him a security interest in its assets. The balance of Schutte's loan will extend operations into November 2018 while the company remains focused on licensing its lead asset LTX-03.
In the absence of closing a licensing agreement upon acceptable terms or securing additional funding, Acura will be required to scale back or terminate operations and/or seek protection under applicable bankruptcy laws. This could result in a complete loss of shareholder value in the company. Even assuming Acura is successful in securing additional sources of financing to fund continued operations, there can be no assurance that the proceeds of such financing will be sufficient to fund operations until such time, if at all, that Acura generates sufficient revenue from its products and product candidates to sustain and grow its operation.
Schutte is the largest shareholder at the company, owning approximately 47.5 percent of the common stock, as well as controlling MainPointe Pharmaceuticals LLC, or MainPointe.