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Biohaven Ltd. (NYSE:BHVN), currently valued at $1.5 billion, filed a prospectus supplement with the U.S. Securities and Exchange Commission on Friday to allow the resale of 3,588,688 common shares by a selling shareholder. The shares were previously issued as part of share consideration under an amendment to a Membership Interest Purchase Agreement originally dated February 24, 2022. According to InvestingPro data, the company maintains a strong liquidity position with a current ratio of 3.82x, though it faces significant cash burn challenges.
The amendment, signed on May 1, 2024, between Biohaven, Biohaven Therapeutics Ltd., Biohaven Pharmaceuticals, Inc., and the selling shareholder, modified the terms of the original agreement. Under the revised terms, a scaled royalty payment structure was replaced with a flat royalty payment in the mid-single digits for BHV-7000 and other pipeline programs. The company’s stock, which has experienced significant volatility with a beta of 3.5, currently trades at $15.71, showing recent momentum with a 6.58% gain over the past week.
Additionally, the amendment reduced success-based payments. Commercial sales-based milestone payments, previously set at up to $562.5 million, were eliminated. Developmental and regulatory milestone payments, previously up to $575 million, were reduced to up to $210 million tied to regulatory approvals for BHV-7000 in the United States, Europe, the Middle East, and Asia. Of this amount, $25 million has already been paid. An additional $60 million may be payable based on regulatory approval in the United States for other Kv7 pipeline programs. Biohaven retains the option to pay these contingent milestone payments in cash or in its common shares.
The company also filed a legal opinion as an exhibit to the 8-K, which is incorporated by reference into the registration statement.
This summary is based on a press release statement contained in the company’s SEC filing.
In other recent news, Biohaven Pharmaceutical has reported higher than expected research and development expenses for the second quarter, totaling $184.4 million. This figure surpasses the average analyst estimate of $173.9 million, despite being a 41% decrease compared to the previous year. Additionally, the company faced a 44% increase in selling, general, and administrative expenses year-over-year, reaching $27.3 million, which was slightly below the estimated $28.1 million. Meanwhile, H.C. Wainwright has lowered its price target for Biohaven from $54 to $30, citing potential equity dilution due to the company’s debt facility with Oberland Capital. Despite this, H.C. Wainwright maintains a Buy rating on the stock, highlighting ongoing developments in Biohaven’s R&D programs. Morgan Stanley and TD Cowen have also reiterated their positive outlook on Biohaven, maintaining price targets of $63 and $75, respectively. These endorsements follow Biohaven’s recent R&D Day, where the company provided updates on its pipeline, including advancements in oncology, neuroscience, and other therapeutic areas. Biohaven is preparing for the commercial launch of Troriluzole, with a Prescription Drug User Fee Act decision anticipated in the fourth quarter of 2025.
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