Outset Medical secures debt financing of up to $300 million


Medical start (Nasdaq: OM) today announced two senior secured credit facilities with investment affiliates managed by SLR Capital Partners.

Collectively, the facilities allow up to $300 million to be borrowed by the manufacturer of the Tablo Hemodialysis System. The facilities include a term loan facility of up to $250 million and an asset-based revolving credit facility of up to $50 million.

At closing, Outset drew $100 million under the term loan facility. It has another $100 million available to borrow under credit facilities at closing. With SLR’s new credit facilities, Outset withdrew its existing, cash-backed credit facility from Silicon Valley Bank.

“We are pleased to have entered into this non-dilutive debt financing on favorable terms, allowing us to further strengthen our balance sheet,” Outset Medical CEO Leslie Trigg said in a press release. “This agreement provides additional support and flexibility as we advance our mission to bring a technology-based, patient-centric approach to dialysis in both acute and home settings.”

Outset Medical will report its third quarter results after the market closes on November 8.

More competition for Outset Medical?

Outset Medical may face increased competition in the home dialysis space after the recent FDA clearance Liberty Select cycler upgrade from Fresenius. Clearance enables remote therapy with Fresenius’ Kinexus therapy management platform. Fresenius plans to make upgrades available to Liberty Select cyclers in the market to enable remote therapy management.

Fresenius officials say the clearance will allow them to improve the home therapy experience for peritoneal dialysis (PD) patients and clinicians.

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