BridgeBio Climbs on $550M Debt Deal with High Conversion Premium
Shares rise as the biotech firm refinances debt, extending maturity to 2033 and setting a conversion price 45% above its recent trading level.
Shares of BridgeBio Pharma, Inc. (NASDAQ: BBIO) gained traction after the company announced a strategic debt refinancing designed to fortify its balance sheet, extending its financial runway as it ramps up commercial operations for its newly approved therapies.
The Palo Alto-based biotechnology firm announced the pricing of a $550 million convertible senior notes offering with a low 0.75% interest rate, due in 2033. The proceeds are earmarked to prefund the repayment of a portion of its 2.50% convertible senior notes due in 2027, a move that pushes out its debt maturity profile and lowers interest expense.
Investors reacted positively to the transaction's favorable terms, which signal strong confidence from the company in its future stock performance. The notes feature an initial conversion price of approximately $110.58 per share, representing a significant 45% premium over the stock's closing price of $76.26 on January 15, 2026. Such a high premium suggests that management believes the company's shares have substantial upside before the noteholders would be able to convert their debt into equity, minimizing near-term dilution concerns for current shareholders.
Further bolstering investor confidence, BridgeBio announced it would use up to $82.5 million of cash on hand to repurchase its own common stock concurrently with the offering. This buyback program acts as an anti-dilutive measure and underscores the management's conviction that the stock is undervalued.
The financial maneuver comes at a pivotal time for BridgeBio, which is transitioning from a clinical-stage to a commercial-stage company. The refinancing provides a more stable, long-term capital structure to support the ongoing launch of its flagship drug, Attruby (acoramidis). The therapy, which received FDA approval in November 2024 for treating the rare heart condition ATTR-CM, is already showing strong commercial momentum, with the company reporting preliminary unaudited full-year 2025 revenue of $362.4 million in a January corporate update.
Beyond Attruby, BridgeBio's pipeline is maturing rapidly. The company expects to submit two New Drug Applications (NDAs) to the FDA in the first half of 2026 for BBP-418 in Limb-Girdle Muscular Dystrophy Type 2I and for Encaleret in Autosomal Dominant Hypocalcemia Type 1, following recent positive Phase 3 trial results. The extended debt runway ensures the company is well-funded to execute these potential commercial launches.
Wall Street has maintained a bullish outlook on the company, with an average analyst price target of $88.95. The stock has traded strongly over the past year, with a 52-week range of $28.32 to $79.88. By securing long-term financing and de-risking its balance sheet, BridgeBio has strengthened its ability to focus on its primary mission: advancing its pipeline and delivering its therapies for genetic diseases to patients.