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Keryx Biopharmaceuticals Announces $125 Million Private Placement Of

The following excerpt is from the company's SEC filing.

Convertible Senior Notes with The Baupost Group, L.L.C.

Keryx implements plan to significantly reduce its annual cash operating expenses, beginning in 2016

Increased cash position expected to take Auryxia (ferric citrate) franchise to cash flow positive

BOSTON, MA

, October 15, 2015 Keryx Biopharmaceuticals, Inc. (Nasdaq: KERX), a biopharmaceutical company focused on bringing innovative therapies to market for people with renal disease, today announced that it has entered into an agreement to raise $125 million through the private placement of Convertible Senior Notes (the Notes), due 2020, with funds managed by The Baupost Group, L.L.C. With the additional capital, Keryx has a pro-forma cash position of approximately $225 million as of September 30, 2015. In conjunction with the financing, Keryx will increase the number of directors on its Board to eight, as Baupost will have the right to appoint a director to Keryxs Board by the end of 2015. Baupost will also appoint an observer to Keryxs board.

The company also announced the implementation of a cost reduction plan to re-align its operating expense structure. The plan is expected to significantly decrease the companys cash operating expenses, excluding cost of goods sold, in 2016 to between $87 million and $92 million. Keryx plans to provide further 2016 financial guidance in early 2016.

We have a significant opportunity with Auryxia and, as we previously outlined, have adapted our strategy to improve the launch of Auryxia in the U.S., including the planned increase of our field-based sales force by approximately 50 percent, said Greg Madison, chief executive officer of Keryx. We continue to be focused on critical activities to drive increased revenue from Auryxia and to advance our label expansion efforts, with data expected early in the second quarter of 2016 from our phase 3 trial in pre-dialysis patients with iron deficiency anemia.

We recently completed a comprehensive review of our financial and business objectives and determined that we should strengthen our balance sheet and implement a plan to...


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