JWCA advises Paratek Pharmaceuticals on its $60 million royalty-backed non-recourse loan with r-bridge healthcare investment advisory (an affiliate of cbc group)

JANUARY 2021 | read press release

Transaction Background

Paratek Pharmaceuticals, Inc. (the “Company”) hired J. Wood Capital Advisors as its Financial Advisor to advise on a capital raise based on the Company’s rights to receive royalties from net sales of omadacycline in China from Zai Labs, and a small synthetic revenue-interest on U.S. net sales of omadacycline

Objectives:

• Replace restrictive, amortizing senior debt with non-recourse, non-dilutive, and low-cost capital

• Monetize and pull forward the value and proceeds from a passive royalty stream in China where product application is not yet approved (est. 1H21)

• Maximize upside retention and minimize economic burden on net sales in core U.S. market

• Provide flexibility for future financing or other strategic actions

• Avoid shareholder dilution and restrictive covenants

JWCA advised Paratek on structuring and negotiating the transaction to help Paratek achieve its objectives:

• Analyzed different terms, structures, and counter-proposals to help the Company identify and secure the best possible terms

Results

• Helped the Company to raise capital in a challenging macro environment for the anti-infective space

• Achieved financing outcome that balanced the Company’s objectives and helped optimize overall capital structure