On December 12, 2022 Clovis Oncology Ireland Limited filed for chapter 11 protection in the District of Delaware (Case No. 22-11294). The Petition states funds will be available to Unsecured Creditors.
Robert J. Dehney
Morris, Nichols, Arsht & Tunnell
Receives Commitment for up to $75 Million in Debtor-in-Possession Financing
BOULDER, Colo.--(BUSINESS WIRE)-- Clovis Oncology, Inc. (NASDAQ:CLVS) (“Clovis” or the Company”), a biopharmaceutical company focused on acquiring, developing, and commercializing innovative anti-cancer agents in the U.S., Europe, and additional international markets, today announced that it and certain of its subsidiaries (collectively, the “Debtors”) have voluntarily initiated a Chapter 11 proceeding in the United States Bankruptcy Court for the District of Delaware (“Bankruptcy Court”) and will seek to sell their assets through a court supervised sales process.
The Debtors have filed various “first day” motions with the Bankruptcy Court requesting customary relief that will enable them to transition into Chapter 11 without material disruption to their ordinary course operations, including seeking authority to obtain debtor-in-possession (“DIP”) financing and pay employee wages and benefits.
In order to provide necessary funding during the Chapter 11 proceeding, Clovis has received a commitment of up to $75 million in a multi-draw DIP financing facility. Upon approval by the Bankruptcy Court, the DIP financing is expected to provide Clovis with the necessary liquidity to operate in the normal course and meet obligations to its employees, vendors and customers throughout the Chapter 11 proceeding while executing on the sales process.
Prior to the Chapter 11 filing, and subject to Bankruptcy Court approval, the Company entered into a “stalking horse” purchase and assignment agreement with Novartis Innovative Therapies AG (“Novartis”) to acquire substantially all of the rights of the Company to its pipeline clinical candidate, FAP-2286, as a therapeutic agent for an upfront payment of $50 million and up to an additional $333.75 million upon the successful achievement of specified development and regulatory milestones and $297 million in later sales milestones. The transaction is part of a sale process under Section 363 of the Bankruptcy Code that will be subject to compliance with agreed upon and Bankruptcy Court-approved bidding procedures allowing for the submission of higher or otherwise better offers, and other agreed-upon conditions. In addition, the transaction is subject to customary closing conditions, including the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. In accordance with the sale process under Section 363 of the Bankruptcy Code, notice of the proposed sale to Novartis will be given to third parties and competing bids will be solicited. The Company will manage the bidding process and evaluate any bids received, in consultation with its advisors and as overseen by the Bankruptcy Court.
Clovis is also actively engaged in discussions with a number of interested parties with respect to a potential sale of one or more of its other assets. Any of those sales would be subject to review and approval by the Bankruptcy Court and compliance with Bankruptcy Court-approved bidding procedures.
Clovis is represented by Willkie Farr & Gallagher LLP as counsel, AlixPartners LLP as restructuring advisor and Perella Weinberg Partners L.P. as restructuring investment banker.
Additional information about the Chapter 11 case, including access to Bankruptcy Court documents, is available online at https://cases.ra.kroll.com/Clovis.