Case Study: Verenium Corporation

verenium corporation logo

"The Athyrium team understood our capital needs and thoughtfully created a flexible financing solution for Verenium."

– James Levine, President and CEO,
Verenium Corporation


Verenium Corporation was a NASDAQ–listed public industrial biotechnology company headquartered in San Diego, CA. The Company engaged in the discovery, design and manufacturing of industrial enzymes used in various markets spanning animal health & nutrition, grain processing and oilfield services.

Athyrium initiated an exclusive dialogue with Verenium in September 2012 to better understand the Company and its financing needs. In early December 2012, Athyrium and Verenium closed the financing transaction.

Structured Investment – Less Dilutive, Long-term Growth Capital

The Company was looking for a long-term financing partner to accelerate the development and commercialization of its deep pipeline of industrial enzymes in new and existing markets. However, at that time, Verenium felt that its stock price was too low and that an equity financing would be too costly and dilutive. In addition, due to NASDAQ listing rules, an equity financing of a similar size would have required an immediate shareholder vote.

Athyrium was able to offer the Company a compelling financing structure that provided long-term capital while minimizing equity dilution. The financing was structured as a $22.5M five-year bullet repay senior secured term loan with warrants. The key covenant was a minimum revenue threshold, with no limitations on operational metrics such as capital expenditures, R&D spending, etc. Athyrium believed that this financing framework would give the management team operating latitude and ample runway to fully expand the business.

At the time of financing, Verenium had an existing secured credit line with Comerica Bank, which the Company wished to maintain. Ultimately, Athyrium’s collateral package included a first lien on the intellectual property and other Company assets and a second lien to Comerica Bank on the working capital. Athyrium agreed to subordinate its lien on certain collateral in order to maximize operating flexibility for Verenium.

Verenium’s Growth

With a well-capitalized balance sheet, Verenium was able to further develop its pipeline and partner with blue-chip industry players.

In February 2013, Verenium launched Pyrolase® HT cellulase, its next-generation enzyme that acts as a biocatalyst to break down the guar-based gel used in hydraulic fracturing in oilfield services.

Less than six months later, in July 2013, Novus International and Verenium announced their new phytase enzyme product, Cibenza® Phytaverse™.

In addition, during the first half of 2013, Verenium launched Deltazym® APS protease for use in corn ethanol operations to reduce cost and chemical usage and entered into a collaboration with Colgate-Palmolive Company to research innovative enzyme-based manufacturing processes to potentially replace traditional chemical processes that are standard in the manufacturing of certain consumer products.


On September 20, 2013, Verenium announced that it had entered into an agreement to be acquired by BASF Corporation. The all-cash tender offer of $4.00 per share represented a 56% premium to the volume-weighted average closing price of Verenium’s common stock in the previous six months.

Athyrium’s term loan was repaid, warrants exercised, and shares tendered.