Biohaven secures up to $600 million from Oberland Capital

NEW HAVEN, Conn. - Biohaven Ltd. (NYSE: BHVN), a clinical-stage biopharmaceutical company currently valued at $2 billion, has finalized an investment agreement with Oberland Capital Management LLC for up to $600 million. The investment aims to bolster Biohaven’s clinical trials and potential commercialization of troriluzole, its treatment candidate for spinocerebellar ataxia (SCA). According to InvestingPro data, the company maintains a healthy balance sheet with more cash than debt, though it’s currently experiencing rapid cash burn.

The first tranche of $250 million in gross proceeds is scheduled for funding by April 30, 2025. An additional $150 million is available to Biohaven upon reaching certain regulatory milestones, including the anticipated U.S. Food and Drug Administration (FDA) approval of troriluzole. Moreover, both parties may mutually agree to fund up to $200 million for strategic acquisitions and related costs. The company’s current ratio of 3.49 indicates strong short-term liquidity, with liquid assets well exceeding short-term obligations.

Oberland Capital’s investment will be in the form of senior secured notes under a Note Purchase Agreement (NPA) that preserves current investor equity. The agreement stipulates that Oberland Capital will receive a regulatory approval milestone payment and tiered single-digit royalty payments on global net sales of troriluzole, capped at a multiple of the funded amounts.

Matt Buten, Biohaven’s Chief Financial Officer, expressed confidence in the partnership with Oberland Capital, highlighting the potential of troriluzole, which has been in clinical research for over eight years. Andrew Rubinstein, Managing Partner at Oberland Capital, conveyed enthusiasm for supporting Biohaven’s work in addressing unmet needs in rare diseases.

Troriluzole is a novel prodrug designed to modulate glutamate levels, potentially benefiting patients with various diseases linked to excessive glutamate. Biohaven’s pipeline includes therapies across immunology, neuroscience, and oncology.

Legal advisement for the transaction was provided by Covington & Burling LLP for Biohaven and Cooley LLP for Oberland Capital.

Investors should note that this news is based on a press release statement and forward-looking statements involve risks and uncertainties. The actual performance and results of Biohaven and its product candidates may differ materially from those projected. InvestingPro analysis reveals that analysts maintain a strong buy consensus with significant upside potential, though the stock has experienced volatility with a -61% return over the past six months. For deeper insights into Biohaven’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro, which covers over 1,400 US stocks with expert analysis and actionable intelligence.

In other recent news, Biohaven Pharmaceutical Holding has been the subject of multiple analyst reports and evaluations. Piper Sandler has maintained an Overweight rating with a $76.00 price target, highlighting the potential of Biohaven’s diverse and advancing pipeline, including the promising results of their IgG degrader platform, BHV-1300. Meanwhile, Morgan Stanley has adjusted its price target for Biohaven from $69.00 to $63.00, maintaining an Overweight rating while focusing on the anticipated FDA decision regarding Troriluzole for Spinocerebellar Ataxia. H.C. Wainwright reaffirmed a Buy rating with a $54.00 target, emphasizing the strong results of BHV-1300 in a Phase 1 study, showing significant IgG reductions with a clean safety profile.

Jefferies has also adjusted its price target for Biohaven to $63.00 from $64.00, maintaining a Buy rating. The firm noted the positive aspects of BHV-1300 but raised concerns about the higher-than-expected 1000mg dose. Despite the setback with BHV-7000 in a Phase 3 trial for bipolar disorder, Biohaven’s focus remains on its neurology and central nervous system disorder programs. Analyst Amy Li from Jefferies remains optimistic about Biohaven’s drug development pipeline, even with the recent adjustments in expectations. These developments reflect the ongoing interest and varied perspectives from analysts on Biohaven’s future prospects in the pharmaceutical sector.

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