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BioPharma Credit PLC on Thursday said it has made a $140.0 million investment in US biopharmaceutical company Insmed Inc for the development of therapies to treat neutrophil-mediated inflammatory diseases and rare pulmonary disorders.
The life sciences debt investment trust, through its fully owned subsidiary and together with BioPharma Credit Investments V LP, has entered into a definitive secured loan agreement with Insmed.
The company invested $140.0 million, while BioPharma-V invested an additional $210.0 million for a total of $350.0 million.
BioPharma's total investment was limited to a 40% share of the transaction, by its requirement to hold cash for purposes of its discount control mechanism.
Nasdaq-listed Insmed has a market capitalisation of around $2.5 billion. The Bridgewater Township, New Jersey-based company is the producer of Arikayce, a first-in-disease therapy approved in the US, Europe, and Japan to treat lung disease.
Alongside this transaction, Insmed announced the raising of $150.0 million through a synthetic royalty sale and $275.0 million through a follow-on equity offering. These financings will increase cash, cash equivalents, and marketable securities to approximately $1.3 billion.
The loan will mature in October 2027 and will bear interest at a rate based upon the secured overnight financing right, subject to a SOFR of 2.5%, and a margin of 7.8% per annum.
A one-time additional consideration of 2.0% of the total loan amount is also payable upon funding of the loan.
BioPharma Credit shares were trading 5.5% lower at $0.90 in London on Thursday afternoon.
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