Coherus Amends Term Loan Agreement with Pharmakon Advisors, LP

- Estimated balance of $75 million upon $175 million paydown of principal projected in Q2 2024 -
- Revenue covenant reduced to $125 million -
- Term loan annual interest expense projected to be reduced by ~70% -

REDWOOD CITY, Calif., Feb. 05, 2024 (GLOBE NEWSWIRE) -- Coherus BioSciences, Inc. (“Coherus,” NASDAQ: CHRS) today announced it has entered into an agreement with Pharmakon Advisors, LP to revise the terms of its loan agreement entered in January 2022. Following the closing of the previously announced divestiture of the ophthalmology franchise to Sandoz, Coherus plans to prepay $175 million of $250 million principal balance in Q2 2024, leaving a residual balance of $75 million and reducing projected annual interest payments by about 70%.

“The divestiture of the ophthalmology franchise, when completed, is projected to provide us with the opportunity to improve our capital structure and reduce interest payment obligations by paying down a significant portion of the principal on term loan debt while renegotiating certain terms,” said Denny Lanfear, Chairman and Chief Executive Officer of Coherus. “This will allow us to move forward with a strengthened balance sheet, supporting sustainable revenue growth in our oncology business and better aligning with our sharpened focus as an oncology innovator.”

“Coherus has done a great job navigating past the adverse macro developments beyond their control which were impacting their business,” said Pedro Gonzalez de Cosio, CEO of Pharmakon Advisors, LP. “With three UDENYCA formats in the pegfilgrastim market, the launch of LOQTORZI into nasopharyngeal carcinoma, plus a promising immuno-oncology pipeline, they have positioned themselves for success as an oncology company. Pharmakon is happy to be a part of their growth and transition.”

Pursuant to and subject to terms and conditions in the Consent and Amendment, among other things: (1) the Lenders and the Collateral Agent provided consent to consummation of the transactions contemplated by that certain Purchase and Sale Agreement dated as of January 19, 2024 (the “Purchase Agreement”) by and between the Company and Sandoz Inc., a Delaware corporation, and released certain subsidiary of the Company from its obligation and certain assets subject to the transactions contemplated thereby, (2) the Lenders and the Collateral Agent permitted the Company to make a partial prepayment of the principal of the loans outstanding under the Existing Loan Agreement in the amount of $175,000,000 upon consummation of the transactions contemplated by the Purchase Agreement, subject to certain conditions and (3) the parties thereto agreed to adjust the minimum net sales covenant level under the Existing Loan Agreement.