BioDelivery Announces $20M Debt Financing - Analyst Blog

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BioDelivery Sciences International, Inc. (BDSI) recently secured a loan from partner, MidCap Financial, LLC. Through this agreement, BioDelivery Sciences has ensured a debt financing of $20 million in the form of a senior secured loan.

The senior secured loan will mature after 3 years with the interest payable only for the first 6 months. MidCap Financial has also issued a warrant to purchase 357,143 shares of BioDelivery Sciences common stock under the terms of the agreement. The exercise price of these shares is $4.20, which is the 20-day volume-weighted average share price of BioDelivery Sciences' common stock before the loan expires.

The debt financing will significantly strengthen BioDelivery Sciences' cash position. The company has a series of pipeline events lined up, including the New Drug Application (NDA) submission for Bunavail.

Last month BioDelivery Sciences completed a successful pre-NDA meeting with the Food and Drug Administration (FDA) for Bunavail's approval for the maintenance treatment of opioid dependence. The company plans to seek US approval of Bunavail for the above indication in mid-summer this year. BioDelivery Sciences expects Bunavail to generate peak sales of over $250 million.

Moreover, BioDelivery Sciences also expects to complete two phase III studies on BEMA buprenorphine, being developed for the treatment of chronic pain. The company has a license and development agreement with Endo Health Solutions Inc. (ENDP) for BEMA buprenorphine. The completion of the second phase III study on the candidate will trigger milestone payments from Endo Health Solutions.

BioDelivery Sciences presently carries a Zacks Rank #4 (Sell). However, pharma stocks such as Jazz Pharmaceuticals (JAZZ) and Targacept, Inc. (TRGT) currently look better positioned with a Zacks Rank #1 (Strong Buy).