aibioZymeworks completes Theravance Biopharma acquisition, with $350 million in senior secured notes
Tickers ZYME
Zymeworks subsidiaries sold $350,000,000 of 8.25% senior secured notes due December 31, 2036 to an OMERS Private Capital affiliate, and former Theravance holders received contingent value rights that the filing calls highly speculative.
Key facts
- Company
- Zymeworks Inc. (NASDAQ: ZYME)
- News type
- Mergers
- Primary source
- Zymeworks Inc. Form 8-K filed September 23, 2026 (SEC EDGAR)
Zymeworks Inc. (Nasdaq: ZYME) said on September 23, 2026 that it completed its acquisition of Theravance Biopharma, Inc. The closing came with two new sets of obligations: $350,000,000 of senior secured notes issued by two indirect Zymeworks subsidiaries, and a contingent value rights agreement that gives former Theravance holders rights to future payments. The company's Form 8-K describes both.
The note financing
Two indirect Zymeworks subsidiaries, Clover Finance Trust and Clover Finance LLC, signed a Note Purchase Agreement with OCM IP Healthcare Portfolio LP, an affiliate of OMERS Private Capital. U.S. Bank Trust Company, National Association is the administrative agent, collateral agent and security trustee. The notes carry a fixed interest rate of 8.25% and mature on December 31, 2036. Interest is paid quarterly in arrears from December 2026, and any shortfall in the collection account may be paid in kind, which adds it to principal.
Four Theravance subsidiaries guarantee the notes: Theravance Biopharma Ireland Limited, Theravance Biopharma US, LLC, Theravance Biopharma R&D IP, LLC and Theravance Biopharma Antibiotics IP, LLC. The issuers and guarantors gave the agent a first-priority security interest in substantially all of their personal property, subject to customary exclusions. The 8-K says the net proceeds funded a portion of the per-share cash consideration and the CVR Payment Amount. It names no financial advisors or law firms for the merger or the notes.
Early repayment and the change-of-control trigger
The issuers may redeem all, but not part, of the notes on 20 Business Days' prior written notice. The price is 100% of principal, plus accrued interest and a yield maintenance premium. That premium is 5.0% of outstanding principal for the first two years, 3.0% in the third year, 2.0% in the fourth and 1.0% in the fifth. After the fifth anniversary of the Closing Date, no premium is payable.
A change of control without the agent's prior written consent, acting at the direction of the Requisite Purchasers, can make the notes and all other obligations immediately due and payable. A merger of Zymeworks into another company does not count if the successor is listed on the NYSE or Nasdaq with a market capitalization of at least $25 billion, and only one such deal is allowed. Events of default include bankruptcy, a material adverse effect and certain cross-defaults. The notes were sold under Section 4(a)(2) of the Securities Act, are unregistered, and are intended to be listed on the Official List of The International Stock Exchange.
Contingent value rights
Zymeworks, Computershare Inc. and Computershare Trust Company, N.A. signed the CVR Agreement on September 22, 2026, with Computershare acting as rights agent. Each CVR is non-tradeable and carries no voting or dividend rights. Holders share in three payments tied to ampreloxetine: a pro rata share of 80% of proceeds from any license, divestiture or other monetization executed within ten years of the effective time; a pro rata share of $50 million in cash on the first commercial sale in the U.S., UK, Spain, France, Germany or Italy, which the agreement sets at $0.93 per CVR; and a pro rata share of 10% of net sales, country by country, until the latest of the 10th anniversary of the first sale, patent expiration or loss of exclusivity.
The filing calls the rights "highly speculative and subject to numerous factors outside the control of Zymeworks or its affiliates." It also says there can be no assurance that any payment will ever be made.
The merger and the company
The merger agreement is dated June 28, 2026, and involves Zymeworks, Theravance Biopharma and Zymeworks Merger Sub I. Merger Sub merged into Theravance, which survives as a wholly owned Zymeworks subsidiary. Each Theravance ordinary share received $17.00 in cash, without interest, plus one CVR.
Its portfolio includes YUPELRI (revefenacin) and Ziihera (zanidatamab-hrii), which is commercialized through partnerships with Jazz Pharmaceuticals and BeOne Medicines.
The annual report filed March 2, 2026 shows revenue of $106.0 million for 2025, up from $76.3 million in 2024. The net loss was $81.1 million in 2025, down from $122.7 million in 2024. Cash used in operations was $33.0 million in 2025, compared with $110.1 million in 2024.