Orexigen Therapeutics filed for Chapter 11 protection with the U.S. Bankruptcy Court in the District of Delaware, case number 18-10518.
The Company, which produces a biopharmaceuticals focused on the treatment of obesity, is represented by Robert J. Dehney of Morris, Nichols, Arsht & Tunnell. The Company announced its intentions to file a motion seeking authorization to pursue an auction and sale process under Section 363 of the U.S. Bankruptcy Code. The proposed bidding procedures, if approved by the court, would require interested parties to submit binding offers to acquire substantially all of Orexigen Therapeutics’ assets, which would be purchased free and clear of the company’s indebtedness and other liens and interests.
Michael Narachi, president and C.E.O. of Orexigen Therapeutics, comments, “The Board and management team have thoroughly assessed all of our strategic options and believe that this process represents the best possible solution for Orexigen, taking into account our financial needs. While we have been working closely with our noteholders and have the support of a controlling number of senior secured noteholders, our debt covenant requirements and near-term cash flow needs have necessitated the protection afforded by a court-driven process.”
The Company has the support of a controlling number of its senior secured noteholders, who have made a $35 million financing commitment. The Company believes that this commitment provides it with sufficient liquidity to conduct its business in an uninterrupted manner, fund its Chapter 11 case, including the sale of its assets, and to continue to meet its operational and financial obligations.
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