Biohaven adds nearly $1B in Nurtec deals with Royalty Pharma, Sixth Street
Biohaven just added nearly $1 billion to their balance sheet.
On Friday morning, the neuroscience biotech announced a pair of creative agreements with Royalty Pharma and the investment firm Sixth Street to bolster the commercial launch of their new migraine drug, Nurtec. Biohaven will sell a sliver of its royalties on Nurtec and 3% of the royalties on their experimental migraine drug zavegepant to Royalty Pharma as part of a larger agreeement that will pay $450 million. At the same time, the company announced they took out a $500 million loan from Sixth Street.
For both Biohaven and its new backers, the two deals represent a significant bet on the commercial potential of a migraine medicine that has already shown strong sales, despite a pandemic launch and stiff competition from two much bigger players in Eli Lilly and AbbVie. In a series of notes, SVB Leerink’s Marc Goodman, who has been following the three different drugs, noted that Nurtec has increasingly been taking up market share from AbbVie’s Ubrelvy. He’s estimated around $50 million in sales for 2020 and forecast $290 million for next year, with $2 billion to $2.5 billion in sales in 2032.
The deal is the second from Royalty Pharma since their record $2.2 billion IPO, following a $650 million deal to acquire royalties on the spinal muscular atrophy gene therapy Roche and PTC Therapeutics are co-developing. The deal with Biohaven includes not only a purchase of royalties – they only acquired 0.4% of Nurtec sales – but also a $250 million direct investment into their commercial operation, to be paid back with 12% interest.
Zavegepant, until recently known as vazegepant, is an intranasal migraine medicine that targets the same CGRP receptor as Nurtec. It is now in Phase II. The company is also testing its potential in Covid-19 patients.
Social: Vlad Coric, Biohaven CEO (Andrew Venditti)