HLB, a Korean pharmaceutical company, landed a $145 million investment from London-based hedge fund LMR Partners as it regroups from two consecutive FDA rejections of its flagship liver cancer treatment.
The financing structure limits immediate access to capital, with only 15% of the $140 million bond with warrants available upfront. The remaining funds sit in escrow until warrant exercise conditions are met, while a three-year lock prevents LMR from exercising its put option. An additional $5 million exchangeable bond targets HLB Life Sciences, the company’s subsidiary.
The investment follows a difficult stretch for HLB. U.S. regulators rejected the company’s liver cancer drug combination — rivoceranib and camrelizumab — twice in the past year, citing manufacturing deficiencies at Chinese partner Jiangsu Hengrui Pharmaceuticals’ facility. The setbacks came despite positive clinical trial data and endorsement from European medical oncology guidelines.
HLB plans to resubmit its application for liver cancer approval and pursue separate authorization for lirafugratinib, a bile duct cancer candidate licensed from U.S.-based Relay Therapeutics for up to $500 million. The company previously aimed to become South Korea’s first drugmaker to win FDA approval for a domestically developed cancer treatment, following Yuhan Corp.’s lung cancer drug approval in 2024.
LMR Partners, which manages approximately $12 billion in assets, facilitated the deal through UBS as sole lead manager. The firm’s convertible bond team recently posted a 30% return through mid-October, according to Bloomberg.
