Halozyme Therapeutics has entered into a $150 million credit agreement, secured by future royalties of ENHANZE products, received only from Halozyme’s collaborations with Roche and Baxalta.

As part of the financing structure, Halozyme formed a wholly-owned subsidiary, Halozyme Royalty, which, subject to satisfaction of certain closing conditions, will borrow $150 million at a per annum interest rate of 8.75% plus the three-month LIBOR rate. Under the terms of the loan, the three-month LIBOR rate is subject to a floor of 0.70% and a cap of 1.50%.

According to a related 8-K, BioPharma Credit Investments IV, a limited partnership managed by Pharmakon Advisors, as collateral agent and lender and Athyrim Opportunities II Acquisition, as lender will provide the $150 million credit facility. The debt transaction is expected to close in January 2016.

“This opportunity for non-dilutive financing further demonstrates how our ENHANZE platform can drive value, and is additive to the $25 million upfront payment from the recently announced licensing and collaboration agreement with Eli Lilly,” said Dr. Helen Torley, president and CEO of Halozyme Therapeutics.

San Diego-based Halozyme Therapeutics is a biotechnology company focused on developing and commercializing oncology therapies that target the tumor microenvironment.