Clovis Oncology files Chapter 11, agrees to sell a drug asset
BOULDER and WILMINGTON, Delaware — Boulder-based Clovis Oncology Inc. (Nasdaq: CLVS) filed for Chapter 11 bankruptcy protection Sunday. Its filing claims liabilities far exceeding assets.
And some of those assets are for sale, including rights to an unapproved drug that Novartis Innovative Therapies AG said it would pay $681 million to secure if the drug receives regulatory approval.
Clovis reported on Dec. 1 to the U.S. Securities and Exchange Commission that it had defaulted on a loan and that it intended to file for bankruptcy protection. The company has struggled in recent months to market its only approved drug, Rubraca, which is used in the treatment of ovarian cancer, according to industry disclosures.
The bankruptcy filing occurred Dec. 11 in U.S. Bankruptcy Court for the District of Delaware, where the company is domiciled.
The bankruptcy filing lists assets of $319 million and debt of $754.5 million. The company has 114.8 million shares of common stock outstanding as of Oct. 31, 2022.
Two affiliated companies — Clovis Oncology UK Ltd. and Clovis Oncology Ireland Ltd. — simultaneously filed for protection.
The top unsecured creditor is The Bank of New York Mellon Trust Co. NA, based in Dallas, with more than $443.2 million in claims.
Most of the equity interest holders in the company are investment companies and other large investors with millions of shares, although Patrick Mahaffy, co-founder, CEO and president, had 970,787 shares as of Oct. 31.
The company reported this morning that it signed a stalking-horse agreement with Novartis prior to filing bankruptcy that would see it sell, subject to the highest bid, the drug FAP-2286. Novartis agreed to pay $50 million up front and would pay an additional $630.75 million if the drug receives regulatory approval. The deal is subject to bankruptcy court approval and the potential for higher bids from other parties.
Clovis also reported today that it has secured $75 million in debtor-in-possession financing to provide liquidity to the company as it continues to operate. This is also subject to bankruptcy court approval.
Clovis said in a press statement today that it is talking with other companies about the potential sale of other assets.
The case is 22-11292-JKS filed in U.S. Bankruptcy Court for the District of Delaware.
Source: BizWest
