Can Biohaven sustain its current R&D spending levels?

**Biohaven's ability to sustain its current R&D spending levels is contingent upon several key factors**: 1. **Recent Financing**: Biohaven has secured a significant non-dilutive financing deal worth up to $600 million from Oberland Capital. This funding is structured to support ongoing clinical trials and commercialization efforts, particularly for troriluzole. The immediate funding of $250 million and the contingent funding tied to regulatory milestones provide a robust financial cushion. 2. **Cash Flow from Operations**: Although Biohaven's operating cash flow is negative at -$170.74 million, the financing deal ensures that the company has the necessary resources to cover its R&D expenses. The free cash flow of -$170.79 million indicates that the company is actively investing in its R&D pipeline, which is a positive sign for its long-term growth potential. 3. **Debt Levels**: Biohaven's debt-to-equity ratio is 0.31, which is relatively low and suggests that the company has a strong equity base to support its debt levels. The total liabilities are $615.11 million, with total assets at $191.67 million. This indicates that Biohaven has a solid asset base to support its R&D spending. 4. **Market Confidence**: The investment from Oberland Capital represents a significant institutional confidence in Biohaven's pipeline, which includes troriluzole for SCA. The company's strategic use of non-dilutive financing aligns with the interests of its investors and underscores its commitment to advancing its R&D initiatives. In conclusion, Biohaven's ability to sustain its current R&D spending levels is supported by its recent financing deal, positive cash flow trends, manageable debt levels, and the confidence of its investors. However, the company must continue to navigate regulatory hurdles and optimize its cash flow to ensure the long-term viability of its R&D efforts.