BioCryst Pharmaceuticals reported in a regulatory filing Tuesday that it has defaulted on some debt after the royalty payments from its Japanese partner didn’t cover the accrued interest on the debt.
In 2007, BioCryst entered into an exclusive licensing agreement with Shionogi & Co. to develop and commercialize its drug Peramivir in Japan for the treatment of seasonal and potentially life-threatening human influenza.
Peramivir is marketed in Japan under the commercial name RAPIACTA.
The default means the owners of the PhaRMA notes could accelerate payment, foreclose on collateral securing the notes and the equity interest in JPR Royalty Sub LLC, a BioCryst wholly-owned subsidiary.
In its filing Tuesday, BioCryst said the royalty payments weren’t enough to pay off the interest by Monday’s payment date. The Durham company said in the event of acceleration of payment or foreclosure, the primary impact of the default would be the loss of future royalty payments from Shionogi and legal costs associated with retiring the defaulted notes.
“As the PhaRMA notes are the oblivcation of Royalty Sub, the company does not currently expect an event of default on the PhaRMA Notes to have a significant impact on the company’s future results or operations of cash flows,” BioCryst wrote in its regulatory filing.
BioCryst shares were down about 3 percent in early trading Tuesday.