BioXcel Therapeutics Files Chapter 11, Secures $77.25M DIP Financing

What Happened
BioXcel Therapeutics, Inc. announced it filed voluntary Chapter 11 petitions on August 27, 2026, and on August 31, 2026 entered a Super-Priority Senior Secured Debtor-in-Possession (DIP) Credit Agreement with affiliates of Oaktree Capital Management, L.P. and the Qatar Investment Authority (with Oaktree Fund Administration, LLC as administrative agent) providing up to $77.25 million in DIP financing. The company also received a Nasdaq notice of delisting on August 31, 2026; Nasdaq will suspend trading of the common stock at the open on September 8, 2026, and the company does not intend to appeal.

Key Details

• DIP Facility total up to $77.25M: $19.0M in New Money Loans (two draws) and up to $58.25M in Roll-Up Loans converting prepetition debt.
• New Money: up to $19M available in two draws (initial draw up to $9.5M on interim order; additional $9.5M on final order). Company expects the initial $9.5M draw on Sept 1, 2026.
• Roll-Up: Roll-Up Loans include a $1.25M bridge loan and an amount equal to three times new money funded; company expects to roll up $29.75M of prepetition obligations on Sept 1, 2026.
• Economics and terms: interest rate 13.00% per annum (New Money interest payable in cash; Roll-Up interest payable-in-kind), default rate +2.0%, exit fee 4.0% of aggregate principal on repayment, maturity January 27, 2027.
• Security and priorities: DIP claims will have superpriority administrative expense status and first‑priority priming liens on substantially all assets (subject to Court-approved carve-outs).
• Other material terms: customary DIP covenants (13-week budget compliance with permitted variances, minimum liquidity $250,000, milestones); proceeds may be used for post-petition working capital, case administration costs, professional fees and approved sale transactions.
• Nasdaq delisting: Nasdaq determined to delist the common stock for commencing Chapter 11; trading to be suspended Sept 8, 2026; company expects trading to move to the OTC Pink Limited Market thereafter and will not appeal.

Why It Matters
For investors, the filing confirms BioXcel is operating under Chapter 11 and has secured short‑term debtor‑in‑possession financing to fund operations and restructure through January 27, 2027 (absent earlier repayment or a sale). The DIP financing provides immediate liquidity (initial $9.5M expected) but converts a significant portion of prior debt into primed DIP obligations and carries high interest and fees. Nasdaq’s delisting and likely move to the Pink market will reduce trading liquidity and could further depress the stock price; the company has not appealed that decision. The company will seek final Court approval of the full DIP Facility at a later hearing.