Lexicon Pharmaceuticals announced a $100 million senior secured loan facility with Hercules Capital, providing the company with up to $100 million in borrowing capacity. The initial $55 million tranche was funded at closing on May 4, 2026, and the remaining $45 million will be available in two subsequent tranches of $20 million and $25 million, each subject to Hercules’ consent and the achievement of specified milestones.
The facility carries a floating interest rate equal to the prime rate plus 3.1%, with a floor of 9.85%. It includes an 18‑month interest‑only period and the option for two six‑month extensions, giving Lexicon flexibility to support upcoming regulatory and commercial milestones for its late‑stage cardiometabolic programs. The loan matures on or before May 4, 2030, is secured by a first lien on Lexicon’s assets, and includes customary covenants such as a minimum cash covenant beginning June 1, 2027.
Lexicon’s chief financial officer, Scott Coiante, said the $55 million tranche will be used to repay an existing loan facility with Oxford Finance, thereby reducing debt and improving liquidity. The new facility provides non‑dilutive capital that can be deployed as the company advances its pipeline, including programs for metabolic diseases, neuropathic pain, rare genetic disorders, and cardiometabolic conditions.
Hercules Capital’s managing director, Adam Soller, noted that the partnership underscores the firm’s commitment to funding innovative therapies that address significant unmet medical needs. Hercules, which focuses on high‑growth biotech and life‑sciences companies, sees this deal as an expansion of its exposure in the sector and a reinforcement of its strategy to provide flexible, non‑dilutive financing.
The loan arrangement positions Lexicon to navigate the next phases of clinical development and regulatory review without diluting shareholder equity, while giving Hercules a secured, first‑lien position in a company with a growing pipeline and a clear path to commercialization. The financing is expected to support the company’s strategic objectives and enhance its balance sheet strength as it moves toward potential approvals and market entry for its cardiometabolic therapies.
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