Arrowhead Pharmaceuticals Secures $500M Strategic Financing from Sixth Street

Arrowhead Pharmaceuticals, Inc. (NASDAQ: ARWR) has announced a major strategic funding deal with Sixth Street to support the growth and development of its RNAi therapeutics pipeline. This arrangement provides Arrowhead with a $500 million senior secured credit facility, with $400 million available immediately and an additional $100 million accessible upon mutual consent within the seven-year agreement period.

Christopher Anzalone, Ph.D., President and CEO of Arrowhead, highlighted the benefits of the agreement, noting that the deal's favorable structure and economics allow the company to enhance its commercial capabilities ahead of a potential 2025 launch of plozasiran for familial chylomicronemia syndrome, pending regulatory approval. Anzalone emphasized that the non-dilutive financing and its repayment terms align well with future revenue streams, supporting the company's growth without immediate cash flow pressures. He also pointed out the flexible repayment terms during the seven-year period, which include risk-sharing features, enabling the company to sustain its innovative pipeline.

In support of the transaction, Jeff Pootoolal, Partner at Sixth Street, and Michael Reslinski, Managing Director, expressed their satisfaction with Arrowhead's platform technology and its promising commercial opportunities. They affirmed their commitment to utilizing Sixth Street's resources and expertise to help Arrowhead achieve its strategic goals. This innovative financing is expected to bolster Arrowhead's position as a significant emerging player in the biopharmaceutical sector.

The loan agreement stipulates a maturity date of August 7, 2031, with an annual interest rate of 15%. Notably, there are no scheduled amortization payments required during the term, and the entire principal is due at maturity. Arrowhead retains the option to prepay the loans at any time. The company is also obligated to partially repay the loans using proceeds from certain transactions, including upfront payments, milestones, royalties from partnerships, and its commercial revenues. Additionally, the obligations are secured by security interests in nearly all of Arrowhead's assets, with specified exceptions.

TD Cowen served as the financial advisor for Arrowhead, while Gibson, Dunn & Crutcher LLP provided legal counsel. Proskauer Rose LLP and Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, PC acted as legal advisors to Sixth Street.

Sixth Street is a global investment firm managing over $75 billion in assets. The firm employs long-term flexible capital, data-driven strategies, and a collaborative culture to support companies at various growth stages. Sixth Street's Healthcare and Life Sciences division finances innovative therapeutics and healthcare technology companies. Its portfolio includes investments in companies such as Arsenal Biosciences, Biohaven, and Blueprint Medicines, among others.

Arrowhead Pharmaceuticals is dedicated to developing RNA interference (RNAi) therapeutics to treat difficult diseases by silencing the genes that cause them. The company utilizes a diverse array of RNA chemistries and delivery methods to achieve rapid and sustained gene knockdown. RNAi is a natural cellular mechanism that inhibits gene expression, impacting protein production to treat disease.

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