- The stock price of Trevena, Inc. (Nasdaq: TRVN) increased by over 20% during intraday trading today. This is why.
The stock price of Trevena, Inc. (Nasdaq: TRVN) – a biopharmaceutical company focused on the development and commercialization of novel medicines for patients with central nervous system (CNS) disorders – increased by over 20% during intraday trading today. Investors are responding positively to Trevena announcing that the company entered into a royalty-based financing with an affiliate of R-Bridge Healthcare Fund (the R-Bridge Financing).
In connection with the R- Bridge Financing, Trevena is going to receive an upfront amount of $15 million, and $15 million upon the first commercial sale of OLINVYK in China. And the company will also receive an additional $10 million upon achievement of either a commercial or financing milestone.
The R-Bridge Financing is going to be repaid through an assignment to R-Bridge of all royalties from the Company’s license with its partner in China, Jiangsu Nhwa Pharmaceutical (Nhwa), and through a 4% net revenue interest in the company’s US net sales of OLINVYK. And this US revenue interest will be capped at $10 million if Chinese approval of OLINVYK occurs by year-end 2023.
In the event Chinese approval does not occur by that time, the US revenue interest will increase to 7% and will continue until certain combined totals of US revenue interest and Chinese royalties are paid. Trevena retains all milestones from its partnership with Nhwa, including a $3 million milestone on Chinese approval of OLINVYK.
Trevena is not subject to financial covenants in connection with the R-Bridge Financing. And the funding of the loan is subject to customary conditions and is expected within 15 days. And Trevena provided to R-Bridge a negative pledge of all of its assets until Chinese approval of OLINVYK in connection with the R-Bridge Financing. Following such approval, the R-Bridge Financing will be non-recourse to Trevena, other than the Chinese royalty and capped US revenue interest.
KEY QUOTE:
“This transaction strengthens our financial position and is also a creative and efficient way to unlock immediate value for an important asset. As a leading global healthcare royalty fund, R-Bridge was uniquely suited to recognizing the significant value created by Trevena and our partner Jiangsu Nhwa.”
— Carrie Bourdow, president and CEO of Trevena
