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PDL BioPharma Concludes Financing Agreement with Avinger

PDL BioPharma, Inc.PDLI announced that it has successfully concluded its structured financing agreement with Avinger, Inc. AVGR .

The termination of the agreement led PDL BioPharma to receive approximately $21.4 million which included repayment of the full principal amount outstanding ($20.6 million) as well as accrued interest and a prepayment fee.

We note that PDL BioPharma and Avinger had entered into a loan and royalty agreement in 2013. Under the agreement, PDL BioPharma had agreed to provide up to $40 million of financing to Avinger, of which only $20 million was funded to date. In exchange, PDL BioPharma was entitled to receive interest on the principal amount outstanding as well as a low single-digit royalty on Avinger's revenues from the sale of its suite of products through Apr 2018.

Per terms of the agreement, PDL BioPharma will however continue receiving royalty but at a reduced rate of 0.9% on Avinger's net revenues from the prepayment date through 2018, subject to minimum quarterly payments.

Meanwhile, PDL BioPharma has been pursuing strategic deals to boost royalties. Earlier this week, the company acquired a portion of the royalties on sales of AcelRx Pharmaceuticals Inc.'s ACRX Zalviso in the EU, Switzerland and Australia. Per the terms of the agreement, PDL BioPharma provided gross proceeds of $65 million to AcelRx. In exchange, the company is entitled to receive 75% of the royalties AcelRx receives from its commercial partner, Grünenthal GmbH, as well as 80% of the first four commercial milestones subject to a capped amount.

A couple of days back, Zalviso received EU approval for the management of acute moderate-to-severe post-operative pain in adults. Zalviso is expected to be available in Western Europe from the first half of 2016.

PDL BioPharma carries a Zacks Rank #2 (Buy). Gilead Sciences Inc. GILD is another favorably ranked stock in the health care sector carrying a Zacks Rank #1 (Strong Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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