Coherus BioSciences Announces Significant Asset Purchase Agreement

On Tuesday, Coherus BioSciences, Inc. (NASDAQ:CHRS) experienced a share increase of over 40% after revealing an asset purchase agreement with Intas Pharmaceuticals Ltd. for the divestiture of its UDENYCA franchise. This deal is valued at up to $558.4 million, which includes an upfront payment of $483.4 million, and additional potential net sales milestone payments totaling $75 million.

The company intends to use the proceeds from this transaction to fully repay its $230 million convertible notes that are due in April 2026 and to eliminate certain royalty obligations linked to UDENYCA for $49.1 million. This divestiture aligns with Coherus' strategy to focus on its immuno-oncology programs, such as the FDA-approved PD-1 inhibitor LOQTORZI® and other significant combination programs, including casdozokitug and CHS-114.

Denny Lanfear, Coherus Chairman and CEO, stated that selling UDENYCA will allow the company to leverage the created value from the franchise and allocate resources towards advancing its immuno-oncology pipeline. This move is also expected to greatly enhance Coherus' capital structure and operational capacity.

A Citi analyst remarked that the sale surpassed expectations in terms of both valuation and timing, noting that it alleviates a financial overhang and allows Coherus to expedite its immuno-oncology research and development.

The agreement terms, as detailed in Coherus' Current Report on Form 8-K, indicate that Intas will receive assets associated with the UDENYCA franchise. Coherus anticipates offsetting nearly all U.S. federal income taxes linked to the divestiture utilizing tax attributes. The transaction is subject to standard closing conditions and is projected to finalize by the end of Q1 2025.

Coherus plans to maximize the value of LOQTORZI and advance its innovative portfolio, expecting several milestones within its immuno-oncology programs in the coming years. The company forecasts cost savings from the divestiture and a post-close cash runway extending beyond two years, past key data readouts anticipated in 2026. J.P. Morgan Securities LLC and Latham & Watkins LLP are serving as the financial advisor and legal counsel, respectively, to Coherus in this transaction.

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