Pernix Therapeutics/Pernix Sleep Inc.

February 18, 2019

In our January 30th Members’-only briefing entitled “😢Who Will Remember Things Remembered?😢 ,” we included a segment subtitled “Pharma Continues to Show Distress (Long Opioid-Related BK)” in which we discussed how Pernix Therapeutics Holdings Inc. ($PTX) looked like an imminent bankruptcy candidate. We noted how the company had previously staved off bankruptcy thanks to a refinancing transaction with Highbridge Capital Management. That refinancing now looks like a perfectly-executed loan-to-own strategy: Phoenix Top Holdings LLC, an affiliate of Highbridge, will serve as the stalking horse bidder of the company’s assets in exchange for $75.6mm plus the assumption of certain liabilities. Highbridge will also, after a competitive process pitted against other debtholders like Deerfield Management Company LP, provide the Debtors with a $34.1mm DIP facility — of which $15mm is new money, $5mm is an accordian facility, and the rest is a roll-up of the pre-petition ABL.

• Jurisdiction: D. of Delaware (Judge [ ])

• Capital Structure: see link above.

• Professionals:

  • Legal: Davis Polk & Wardwell LLP (Marshall Huebner, Eli Vonnegut, Christopher Robertson) & (local) Landis Rath & Cobb LLP (Adam Landis, Kerri Mumford, Jennifer Cree, Nicolas Jenner)

  • Financial Advisor: Guggenheim Partners LLC (Stuart Erickson)

  • Investment Banker: Ernst & Young LLP

  • Claims Agent: Prime Clerk LLC (*click on the link above for free docket access)

• Other Parties in Interest:

  • Stalking Horse Purchaser: Phoenix Top Holdings LLC (a Highbridge Capital Management affiliate)

  • Large debtholder: Deerfield Management Company LP

    • Legal: Sullivan & Cromwell LLP

  • DIP Agent: Cantor Fitzgerald Securities

    • Legal: Skadden Arps Slate Meagher & Flom LLP (Sarah Ward)

Updated: 2/19/19 at 8:51 CT