Synergy Pharmaceuticals Secures $300 Million Debt Financing

NEW YORK–(BUSINESS WIRE)– Synergy Pharmaceuticals Inc. (NASDAQ: SGYP), announced today that the
Company has closed on a $300 million debt financing structured as senior
secured loans from CRG LP, a healthcare focused investment firm, and its
lender syndicate.

“This non-dilutive financing enhances our cash position and provides us
with financial flexibility to continue to execute on the launch of
TRULANCE and achieve our business objectives, which we are confident
will ultimately maximize long-term shareholder value,” said Gary
Gemignani, EVP and Chief Financial Officer of Synergy Pharmaceuticals
Inc. “The structure of this financing provides us with access to capital
for support of our commercialization of TRULANCE and funds our current
plans for the Company through 2019 when, based on our current
assumptions, we expect to be cash flow breakeven.”

“We are excited for the opportunity to support Synergy at this important
stage in the commercialization of TRULANCE,” said Luke Düster, Managing
Director of CRG. “As part of our investment process at CRG, we performed
extensive due diligence on TRULANCE, the market opportunity and
Synergy’s overall business and commercial strategy. The results
confirmed that TRULANCE has a substantial opportunity to serve the GI
community and that there is tremendous potential to add significant
value to the Company. This transaction demonstrates our confidence in
Synergy’s product, commercial strategy and its team’s ability to
optimize TRULANCE and successfully capitalize on this large and growing
market.”

“We are pleased to partner with CRG, an investment partner that is known
for its strategic investments in healthcare,” said Gary S. Jacob,
Chairman and Chief Executive Officer of Synergy, “We remain committed to
maximizing the potential benefit of TRULANCE and bringing this important
new treatment option to healthcare providers and patients.”

Transaction Terms

The first tranche of $100 million was funded upon execution of the loan
documents. The loan agreement provides for future borrowings, subject to
the satisfaction of certain financial and revenue milestones and other
borrowing conditions as follows: (i) an additional $100.0 million on or
before February 28, 2018, and (ii) up to two additional tranches of up
to $50.0 million each on or before March 29, 2019. The loans mature on
June 30, 2025 and payments under the loan are interest only paid
quarterly for the initial five-year period, followed by 12 equal
quarterly installments of principal and interest during the final three
years of the term, which converts to an eight-year interest only period
if certain milestones are achieved. The loans carry an annual interest
rate of 9.50%. The Company maintains the option to prepay outstanding
loan amounts during the term of the loan. Further information with
respect to the non-dilutive debt financing agreement with CRG are set
forth in the Form 8-K to filed by the Company with the Securities and
Exchange Commission reporting the entry into the loan transaction on
September 1, 2017. Royalty/Revenue Interest Capital Advisors served as
exclusive financial advisor for this transaction.

About Synergy Pharmaceuticals Inc.

Synergy is a biopharmaceutical company focused on the development and
commercialization of novel GI therapies. The company has pioneered
discovery, research and development efforts on analogs of uroguanylin, a
naturally occurring and endogenous human GI peptide, for the treatment
of GI diseases and disorders. Synergy’s proprietary GI platform includes
one commercial product TRULANCE and a second lead product candidate,
dolcanatide. For more information, please visit www.synergypharma.com.

About CRG

CRG is a premier healthcare-focused investment firm with more than $3.0
billion of assets under management across more than 45 portfolio
companies. The firm seeks to commit between $20 to $300 million in each
investment across the healthcare spectrum, including: medical devices,
biopharmaceuticals, tools & diagnostics, services and information
technology. CRG provides growth capital in the form of long-term debt
and equity to support innovative, commercial-stage healthcare companies
that address large, unmet medical needs. The firm partners with public
and private companies to provide flexible financing solutions and
world-class support to achieve exceptional growth objectives with
minimal dilution. CRG maintains offices in Boulder, Houston and New
York. For more information, please visit www.crglp.com.

Forward-Looking Statement

This press release and any statements made for and during any
presentation or meeting contain forward-looking statements related to
Synergy Pharmaceuticals Inc. under the safe harbor provisions of Section
21E of the Private Securities Litigation Reform Act of 1995 and are
subject to risks and uncertainties that could cause actual results to
differ materially from those projected. These statements may be
identified by the use of forward-looking words such as « anticipate, »
« planned, » « believe, » « forecast, » « estimated, » « expected, » and « intend, »
among others. There are a number of factors that could cause actual
events to differ materially from those indicated by such forward-looking
statements. These factors include, but are not limited to, the timing
and potential for successful development, launch, introduction and
commercial potential of TRULANCE; growth and opportunity, including peak
sales and the potential demand for TRULANCE, as well as its potential
impact on applicable markets; market size; substantial competition; our
ability to fund the payment of interest and principal of the loan
amounts and to continue as a going concern; our need for additional
financing; uncertainties of patent protection and litigation;
uncertainties of government or third party payer reimbursement;
dependence upon third parties; our financial performance and results,
including the risk that we are unable to manage our operating expenses
or cash use for operations, or are unable to commercialize our products,
within the guided ranges or otherwise as expected; and risks related to
failure to obtain FDA clearances or approvals and noncompliance with FDA
regulations. As with any pharmaceutical under development, there are
significant risks in the development, regulatory approval and
commercialization of new products. There are no guarantees that future
clinical trials discussed in this press release will be completed or
successful or that any product will receive regulatory approval for any
indication or prove to be commercially successful. Investors should read
the risk factors set forth in Synergy’s most recent periodic reports
filed with the Securities and Exchange Commission, including Synergy’s
Form 10-K for the year ended December 31, 2016. While the list of
factors presented here is considered representative, no such list should
be considered to be a complete statement of all potential risks and
uncertainties. Unlisted factors may present significant additional
obstacles to the realization of forward-looking statements.
Forward-looking statements included herein are made as of the date
hereof, and Synergy does not undertake any obligation to update publicly
such statements to reflect subsequent events or circumstances except as
required by law.

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