Jeremy L. Dillon
RW Monitor
10/10/2014
SHINE Medical Technologies has entered into a $125 million term sheet with Deerfield Management Company to provide debt and equity financing for its production of molybdenum-99, the company announced this week. SHINE is one of several companies trying to get through the regulatory hurdles to begin the production of the medical isotope used in millions of medical procedures annually. “The momentum we’ve gained in just the past year demonstrates that SHINE is positioned to become North America’s preeminent supplier of medical isotopes,” SHINE CEO Greg Piefer said in a statement. “This is an important step toward complete financing of our North American plant. Deerfield’s reputation in the healthcare industry is unparalleled and I’m thrilled they share SHINE’s vision for a reliable, domestic supply of medical isotopes. We could not have found a better partner to move SHINE forward.”
Under the terms of the agreement, Deerfield will provide debt financing in milestone-driven phases while also committing to participate in SHINE’s concurrent equity financing. This equity funding will also be matched up to $25 million by the National Nuclear Security Administration under the terms of a cost-sharing cooperative agreement. This flush of funding will then go toward completing the design and construction of SHINE’s manufacturing plant and covering ramp-up costs as the company increases operating staff prior to commencing commercial production, the company said. SHINE is currently waiting for Nuclear Regulatory Commission construction authorization on its design of a production facility before breaking ground in Janesville, Wis.
With Canada set to stop government spending in 2016 on the National Research Universal (NRU) reactor, one of the world’s largest suppliers of moly-99 and technetium-99m, the medical isotope industry is expecting a shortage in the market in the coming years. This shortage had led to a slew of startups –eight-to-nine companies have already sent the NRC letters of intent to submit construction authorization licenses for a potential Moly-99 production facility—looking to fill the lucrative void. Most, if not all, of these companies have a timeline for the end of 2016/beginning of 2017 for reaching production capabilities, but regulatory hurdles lie ahead. The NNSA has been helping to jump start domestic production of medical isotopes through a cost-sharing cooperative agreement with four companies to develop technology to produce Moly-99.
