BioCryst Pharmaceuticals (NASDAQ:BCRX) stock is slipping on Tuesday after the biotech company announced new funding to pay down debts.
According to a press release, BioCryst Pharmaceuticals has acquired $300 million from funds managed by Pharmakon Advisors, LP. The company intends to use this money to pay off the debt held by Athyrium Capital Management and cover fees and expenses connected to it.
BioCryst Pharmaceuticals notes that it will have $26 million remaining from that $300 million after paying off its debt. The company also has the option of pulling out another $150 million in funds from Pharmakon Advisors, LP until September 2024.
The new credit facility used by BioCryst Pharmaceuticals has a 3-month Secured Overnight Financing Rate of 7%. The company has the option of paying up to 50% of the interest on the loans in advance of its closing date. The loan matures in 2028.
BCRX Stock Repayment Plan
BioCryst Pharmaceuticals Chief Financial Officer Anthony Doyle said the following about how the company will repay this latest loan:
“This new credit agreement with Pharmakon enhances BioCryst’s already strong financial position by extending our repayment bullet from 2025 to 2028, when we expect our growing ORLADEYO revenues will be much closer to our peak of $1 billion.”
Despite this, investors aren’t impressed. As of this writing, nearly 3 million shares of BCRX stock have changed hands as traders sell shares. For comparison, the company’s daily average trading volume is roughly 2.8 million shares.
BCRX stock is down 7.7% as of Tuesday morning.
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.