FinOps Consulting Secures $50MM+ to Finance Expansion for Pharmaceutical Manufacturer
Marion Street Capital helped a contract pharmaceutical manufacturer (“PharmaCo”) secure over $56MM in term sheets. This capital would enable the construction and launch of a new state-of-the-art facility to dramatically expand PharmaCo’s manufacturing capacity.
The Most Pressing Challenge
PharmaCo operated a 503A compounding pharmacy, serving patient-specific prescriptions. While profitable, this model limited scale.
To unlock growth, PharmaCo launched a 503B FDA-registered facility—enabling batch manufacturing for office-use sales to hospitals and clinics nationwide. This transition required:
$50MM+ in capital for a cGMP-compliant 50,000 sqft facility
Advanced equipment to meet FDA regulatory standards
Complex capital stack: senior + mezzanine debt, minimal equity dilution
Fast execution timeline to meet market demand
How Marion Street Capital Solved the Most Pressing Challenge
MSC deployed its FinOps expertise to design and execute a comprehensive capital strategy. Key activities included:
Financial Modeling & Capital Strategy
Updated the PharmaCo’s financial model and credit profile to reflect lender underwriting requirements, including 503B-specific regulatory and market considerations.
Created scenario analyses to balance leverage, amortization schedules, and founder equity retention.
Investor Outreach & Negotiations
MSC sourced multiple lenders, including a private credit fund that issued an initial $20MM term sheet. This early proposal strategically applied competitive pressure to other lenders, which expedited their term sheet issuance. This dynamic enabled MSC to optimize terms for PharmaCo.
Curated tiered lists of target lenders and investors, including banks, private credit funds, and mezzanine financiers.
Managed negotiations across multiple parties to drive competitive term sheet offers.
Navigated complex discussions with both senior secured lenders and private credit providers to optimize debt terms and structure.
Outcome: $56MM in Term Sheets Secured at Optimal Terms
Frequently Asked Questions
What is a 503B pharmaceutical manufacturer?
A 503B facility is an FDA-registered outsourcing facility authorized to produce medications in bulk for office use, enabling nationwide hospital and clinic distribution.
Why did PharmaCo need $50MM+ in financing?
To build a new 50,000 sqft cGMP-compliant facility and purchase advanced manufacturing equipment required for FDA-approved production at scale.
How did Marion Street Capital help?
MSC structured the capital stack, secured competitive term sheets from private credit funds and banks, and preserved founder equity during the financing process.