RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)--
BioCryst
Pharmaceuticals, Inc. (NASDAQ:BCRX) today announced that it has
closed a $30 million financing transaction to monetize certain future
RAPIACTA® (peramivir)
payments from Shionogi & Co., Ltd. BioCryst intends to use its net
proceeds received for general corporate purposes, primarily funding
BioCryst's research and development efforts, including clinical
development of BCX4208
and pre-clinical development programs.
Stuart
Grant, Senior Vice President and Chief Financial Officer of BioCryst
Pharmaceuticals said, "This non-dilutive financing significantly extends
BioCryst's cash runway and it provides additional financial flexibility
as BioCryst advances its pipeline toward important clinical milestones
and other potential value creating events."
Under the terms of the transaction, BioCryst transferred to JPR Royalty
Sub LLC ("JPR"), a newly-formed wholly-owned subsidiary of BioCryst,
certain rights under BioCryst's license agreement with Shionogi,
including the right to receive royalty payments from commercial sales of
RAPIACTA® and future milestone payments. As part of the
transaction, BioCryst also transferred to JPR the right to receive
payments under a new Japanese yen/U.S. dollar foreign currency hedge
arrangement put into place by BioCryst in connection with the
transaction. BioCryst's collaboration with Shionogi remains unchanged as
a result of the transaction.
As part of the transaction, JPR issued $30 million in aggregate
principal amount of its JPR PhaRMA Senior Secured 14% Notes due 2020
(the "Notes") in a private placement exempt from registration under the
Securities Act of 1933, as amended (the "Securities Act"). The Notes
bear an interest rate of 14.0%, with interest payable annually on
September 1st of each year, beginning September 1, 2011, and
on the final legal maturity date. The royalty and milestone payments, if
any, that JPR will be entitled to receive under the license agreement
with Shionogi, together with any payments made under the currency hedge
arrangement, will be the primary source of payment of principal of, and
interest and any premium on, the Notes. The Notes are secured by a
security interest granted by JPR in its rights to receive payments under
the Shionogi license agreement and the currency hedge arrangement, all
of its other assets and a pledge by BioCryst of its equity ownership
interest in JPR. The Notes are non-callable prior to the first
anniversary of today's closing. After March 9, 2012, the Notes may be
redeemed at any time prior to maturity, in whole or in part, at the
option of JPR at specified redemption premiums.
The Notes have a final legal maturity of December 1, 2020. Under the
terms of the Notes, when Shionogi payments, together with any payments
made under the currency hedge arrangement, received by JPR exceed JPR's
ongoing expenses and the interest payments due annually on the Notes,
the excess will be applied to the repayment of principal of the Notes
until they have been paid in full. Accordingly, depending on payments
from Shionogi, the Notes may fully amortize and be repaid prior to the
final legal maturity date. BioCryst remains entitled to receive any
royalties and milestone payments related to sales of RAPIACTA®
following repayment of the Notes. The Notes constitute obligations of
JPR, and are intended to be non-recourse to BioCryst except to the
extent of BioCryst's pledge of its equity interest in JPR as part of the
collateral securing the Notes. The Notes are not convertible into
BioCryst's equity.
BioCryst received net proceeds of approximately $23 million from the
transaction after transaction costs and establishment of a $3 million
interest reserve account by JPR which will be available to help cover
any interest shortfalls on the Notes through September 1, 2013.
The Notes have not been and will not be registered under the Securities
Act, and may not be offered or sold in the United States absent an
applicable exemption from the registration requirements of the
Securities Act.
Morgan Stanley & Co. Incorporated acted as placement agent for the
transaction.
About RAPIACTA®
BioCryst and Shionogi & Co., Ltd. entered into an exclusive license
agreement in March 2007 for the development and commercialization of
i.v. peramivir in Japan and Taiwan. In January 2010, Shionogi received
regulatory approval for i.v. peramivir in Japan for the treatment of
adults with uncomplicated seasonal influenza and launched it under the
commercial name RAPIACTA®. In October 2010, Shionogi
received Japanese approval for an expanded use indication for RAPIACTA®
for the treatment of children and infants with influenza. RAPIACTA®
has not yet been approved in Taiwan.
About BioCryst
BioCryst Pharmaceuticals, Inc. designs, optimizes and develops novel
small-molecule pharmaceuticals that block key enzymes involved in
infectious diseases, inflammatory diseases and cancer. BioCryst
currently has three late-stage compounds in development: peramivir, a
neuraminidase inhibitor for the treatment of influenza, BCX4208, a
purine nucleoside phosphorylase (PNP) inhibitor for the treatment of
gout, and forodesine, an orally-available PNP inhibitor for
hematological malignancies. Utilizing crystallography and
structure-based drug design, BioCryst continues to discover additional
compounds and to progress others through pre-clinical and early
development to address the unmet medical needs of patients and
physicians. Peramivir was approved for commercial sale by Shionogi in
Japan in January 2010. For more information, please visit the Company's
website at www.biocryst.com.
Forward-Looking Statements
This press release contains forward-looking statements, including
statements regarding future results, performance or achievements. These
statements involve known and unknown risks, uncertainties and other
factors which may cause our actual results, performance or achievements
to be materially different from any future results, performances or
achievements expressed or implied by the forward-looking statements.
These statements reflect our current views with respect to future events
and are based on assumptions and subject to risks and uncertainties.
Given these uncertainties, you should not place undue reliance on these
forward-looking statements: JPR's ability to service its payment
obligations in respect of the Notes, and BioCryst's ability to benefit
from its equity interest in JPR, is subject to numerous risks. RAPIACTA®
is a newly approved product in Japan, has not yet been approved for sale
in Taiwan, and future sales of RAPIACTA® by Shionogi are very
difficult to predict. Further, RAPIACTA® sales are expected
to be highly seasonal and vary significantly from year to year, and the
market for products to treat or prevent influenza is highly competitive.
Under BioCryst's license agreement with Shionogi, Shionogi has control
over the commercial process for RAPIACTA® in Japan and
Taiwan. JPR's ability to service the Notes may be adversely affected by,
among other things, changes in or any termination of BioCryst's
relationship with Shionogi, reimbursement, regulatory, manufacturing
and/or intellectual property issues, product recalls, product liability
claims and allegations of safety issues. Additionally, BioCryst may be
required to post cash for mark to market risk, and pay significant
premiums or a termination fee, under the foreign currency hedge
agreement entered into by the Company in connection with the issuance by
Royalty Sub of the PhaRMA Notes. Please also refer to the documents
BioCryst files periodically with the Securities and Exchange Commission,
specifically BioCryst's most recent Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q, and current reports on Form 8-K, all of
which identify other important factors relating to BioCryst that could
cause the actual results to differ materially from those contained in
our projections and forward-looking statements.
BCRXW
BioCryst Pharmaceuticals
Robert Bennett, +1-919-859-7910
Source: BioCryst Pharmaceuticals, Inc.
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