Biohaven Ltd. has secured a significant financial boost through a non-dilutive funding agreement with Oberland Capital Management LLC for up to $600 million. The announcement sent Biohaven's shares trading higher in premarket activity on Monday, reflecting positive investor sentiment toward this strategic financial arrangement.
The investment is structured as a Note Purchase Agreement (NPA) with the first tranche of $250 million in gross proceeds expected to be funded at closing on or before April 30, 2025. This financial arrangement provides Biohaven with substantial capital without diluting current shareholders' equity.
Strategic Funding Structure
The agreement includes milestone-based additional funding tranches. Following FDA approval of troriluzole, Biohaven may access an additional $150 million at its option. A further $200 million could become available upon mutual agreement for strategic acquisitions and related expenses, subject to specific conditions.
In exchange for this investment, Oberland Capital will receive regulatory milestone payments through 2030 and tiered single-digit royalties on global net sales of troriluzole for up to 10 years. These payments are capped at a predetermined multiple of the invested amount.
Matt Buten, Chief Financial Officer at Biohaven, highlighted the significance of the deal: "Our ability to secure this flexible, long-term, non-dilutive financing agreement speaks not only to the vast potential afforded by troriluzole, the product of more than 8 years of clinical research and deep collaborations across the SCA community, but also to Oberland Capital's confidence in our broader portfolio of five innovative platforms spanning immunology & inflammation, neuroscience, and oncology."
Focus on Spinocerebellar Ataxia
The funding will primarily support Biohaven's clinical trial programs and commercialization initiatives for troriluzole, particularly for the treatment of spinocerebellar ataxia (SCA). SCA represents a group of rare, progressively debilitating, and fatal genetic disorders that currently lack FDA-approved treatments.
Andrew Rubinstein, Managing Partner at Oberland Capital, expressed enthusiasm about the partnership: "Biohaven is in a unique position to address major areas of unmet need in rare disease, and we are particularly enthusiastic about supporting Biohaven as they strive to bring a novel medication like troriluzole to the SCA patient community."
Strengthened Financial Position
Prior to this agreement, Biohaven reported approximately $489 million in cash, cash equivalents, marketable securities, and restricted cash as of December 31. This new funding significantly strengthens the company's financial position, potentially extending its operational runway and enabling more aggressive pursuit of its development and commercialization goals.
Broader Portfolio Development
Beyond troriluzole for SCA, the funding will support Biohaven's broader development portfolio. The company is advancing multiple clinical programs across immunology, inflammation, neuroscience, and oncology. Recent data for BHV-1300 has shown promise in immunoglobulin reduction, positioning it as a potential therapy for autoimmune conditions.
The investment from Oberland Capital represents a vote of confidence in Biohaven's scientific approach and commercial potential. For patients with rare diseases like SCA, this funding brings hope that novel therapeutic options may soon become available where none currently exist.
Market Response
Investors responded positively to the announcement, with Biohaven shares rising 5.85% to $21.00 in premarket trading. The non-dilutive nature of the funding appears particularly attractive to the market, as it provides substantial capital without reducing existing shareholders' ownership stakes.
For the rare disease community, particularly those affected by SCA, this financial arrangement may accelerate the development and potential approval of troriluzole, potentially bringing the first approved treatment option to patients with these devastating genetic disorders.
