KalVista secures US$125m of CB funding for drug launch
KalVista Pharmaceuticals derisked the commercial launch of its newly approved treatment for a rare disease with US$125m from the upsized sale of six-year convertible bonds.
Jefferies and TD Cowen priced the debut securities issue late on Wednesday at a coupon and conversion premium of 3.25% and 30% after marketing US$110m of the securities overnight at 3.125%–3.375% and a fixed premium.
The rare disease specialist continued a resurgence of biotech paper in the structured equity market following recent deals from Cytokinetics (US$650m) and Alnylam (US$575m) earlier in September.
KalVista’s shares slipped 8.4% to US$11.83 on Thursday, which is not bad for a first time CB issuer, which opted against repurchasing its own shares to facilitate hedging.
KalVista has only sold stock twice in the nine years since it went public in a reverse merger, including a US$160m sale of 10.5m shares at US$15.25 in February 2024.
The shares remain tightly held by 10 investors who own 75% of the outstanding stock, according to LSEG data.
KalVista’s drug, called Ekterly, has just been approved in Europe after receiving US approval for acute attacks of hereditary angioedema, an inherited disease that causes painful and potentially deadly swelling of the face and limbs, earlier this year.
The CB proceeds add to US$191m of existing cash held on July 31, enough to last until the end of 2027, or early 2028.