Medicalgorithmics and the company’s dominant shareholder, BioFund Capital Management LLC, have signed an agreement to establish a loan line of up to $3 million. The agreement confirms the company’s comfort in implementing its 2023-2026 strategy and expands its development opportunities. Currently, Medicalgorithmics does not plan to use the line, financing its operations with its own funds and operating cash flows.
The agreement between BioFund Capital Management LLC and the medtech company, part of the sWIG80 index at Polish Warsaw Stock Exchange, fulfills the fund’s declaration from the 2022 investment agreement, under which it invested in Medicalgorithmics and acquired a controlling stake. The fund committed to supporting the company’s further development, including providing financing in the form of loans up to $3 million.
“The financial line created by BioFund confirms Medicalgorithmics’ financial resources and fulfills the provisions of the investment agreement and the financial assumptions of the development strategy. It gives us access to funds available for immediate use in implementing the strategy, including R&D projects, acquisition of technology and commercialization on the global market. It’s important to remember that the primary source of financing for the company’s business model transformation is our own funds and the 2022 capital investment from BioFund,” commented Maciej Gamrot, CFO of Medicalgorithmics.
As of the end of March 2024, the company’s cash balance was PLN 16.4 million. “This clearly shows that we won’t need additional financing in the near future. Of course, like any growing company with a good financial standing, we engage in market discussions to secure grant projects, R&D project funding, or bank loans,” added Maciej Gamrot.
“Our main goal, as the largest shareholder, is to consistently increase the company’s value by supporting the implementation of the development strategy, aiming to make it a leader in the global market for non-invasive diagnostic technologies. We are deeply convinced of the immense growth potential of Medicalgorithmics. Therefore, we are providing the company with a loan line that increases its comfort in executing the strategy and undertaking new initiatives arising from it, such as additional R&D projects,” said Paul Lewicki, partner and co-owner of BioFund Capital Management LLC.
The agreement stipulates that Medicalgorithmics can use the BioFund financial line in tranches of up to $1 million for specific projects in technology development or mergers and acquisitions. The line’s value is set at a maximum of $3 million. The loans will bear market interest (SOFR rate plus a 2.2% margin), and repayment will be made – unless otherwise agreed – in 24 monthly installments, with the first repayment no earlier than October 2025.