Kodiak Sciences Has Declined $125M Funding From Baker Bros Citing Strong Balance Sheet

In December 2019, Kodiak Sciences Inc KOD entered into a funding agreement with Baker Bros Advisors LP, wherein Baker Bros agreed to fund up to $225 million in exchange for the right to 4.5% royalties on Kodiak’s potential future net sales of KSI-301 and certain other products.
The royalty was capped at 4.5 times the total amount funded under the Funding Agreement.
By February 2020, Baker Bros funded $100 million, with the remaining $125 million to be provided after achieving specified criteria.
At Kodiak’s request, Baker Bros acknowledged and confirmed that the second funding amount would not be paid, and the aggregate royalty cap would be reduced from around $1 billion to $450 million.
The request was made in light of, among other factors, Kodiak’s strong balance sheet and its clinical trial progress.
As of March, the cash balance stood at $929 million.
Price Action: KOD shares are down 3.8% at $84.77 during the premarket session on the last check Friday.