Filing Alert: BioXcel Therapeutics Chapter 11

BioXcel Therapeutics, Inc., a New Haven, CT-based biopharmaceutical company built on artificial intelligence to develop medicines in neuroscience, filed for ...

BioXcel Therapeutics, Inc. and its debtor affiliates⁽¹⁾, a New Haven, CT-based biopharmaceutical company built on artificial intelligence to develop medicines in neuroscience, filed for Chapter 11 protection on Aug. 27 in the U.S. Bankruptcy Court for the District of Delaware.

The Company attributes the filing to a slower-than-anticipated commercial launch of IGALMI® (dexmedetomidine) sublingual film, its only approved product. IGALMI was cleared by the FDA in April 2022 for acute agitation associated with schizophrenia or bipolar I or II disorder, and was launched into hospitals and psychiatric facilities in July 2022.

The Declaration cites extended formulary review timelines, restrictive institutional purchasing protocols, and the need for sustained educational outreach to change established prescribing habits. Net revenue fell from $2.3 million in FY 2024 to $0.6 million in FY 2025 as the Company scaled back its commercial organization. Those revenue levels were insufficient to cover operating expenses, debt service, and ongoing clinical development costs.

Distress was compounded by developments in the TRANQUILITY program, under which BXCL501 was evaluated as a potential treatment for agitation associated with Alzheimer's dementia. On June 29, 2023, the Company announced positive TRANQUILITY Phase 3 topline results. That same announcement disclosed an FDA Form 483 issued at a trial site, relating to a falsified email sent to the FDA by the principal investigator overseeing the trial, who was not a Company employee. The share price dropped approximately 64% in a single day and has not recovered.

In August 2023 the Board approved a strategic clinical reprioritization concentrating resources on the SERENITY at-home label expansion, which would permit patients experiencing agitation events to be treated at home without an overseeing healthcare professional, expanding IGALMI® beyond the supervised care setting. The reprioritization paused the TRANQUILITY Phase 3 program, BXCL502, the BXCL503 and BXCL504 concepts, and further development of the BXCL701 immuno-oncology program held through OnkosXcel. Workforce reductions in May and September 2024 took full-time headcount from approximately 60 to 25 as of the Petition Date.

The Debtors reported a net loss of $27.4 million for the six months ended June 30, 2026, against $26.4 million in the prior-year period, and disclosed substantial doubt about their ability to continue as a going concern.

Operating performance did not permit compliance with the financial covenants or payment obligations under the Debtors' sole funded-debt instrument. That instrument is an April 19, 2022 senior secured first-lien term loan with Oaktree Fund Administration, LLC as administrative agent and lenders consisting of funds affiliated with Oaktree Capital Management and the Qatar Investment Authority, on which approximately $112 million of principal was outstanding at filing.

Successive amendments followed. The Ninth Amendment in March 2026 waived the covenant prohibiting a going-concern qualification in the FY 2025 audited financials and reduced minimum liquidity from $15 million to $12.5 million, in exchange for a $2.5 million principal prepayment and warrants. The Tenth Amendment in July 2026 deferred the principal and interest payment due June 30, 2026, cut minimum liquidity to $7.5 million, and established a framework requiring a definitive strategic transaction by July 31, 2026.

The filing aims to effectuate a sale of substantially all assets under section 363, followed by confirmation of a Chapter 11 plan to wind down the remaining estates and distribute sale proceeds in an orderly liquidation. An affiliate of Teva Pharmaceutical Industries Ltd. has executed a stalking horse asset purchase agreement providing for $57.5 million in cash consideration at closing, plus up to $67.5 million in contingent milestone payments. The milestone payments are tied to the outcome of the Company's pending sNDA for at-home use of BXCL501 — carrying a PDUFA date of Nov. 14, 2026 — and to future commercial performance. The transaction remains subject to higher or otherwise better offers.

The Bid Procedures Motion, supported by the declaration of MTS Partner Daun Chung, seeks approval of bidding procedures, the Stalking Horse APA, and its bid protections consisting of a break-up fee and expense reimbursement payable solely upon certain negotiated termination events. The motion also seeks approval of assumption and assignment procedures, and scheduling of an auction, if necessary, and a sale hearing. Samir Saleem, a Managing Director of MERU, has served as CRO since Aug. 26, 2026 and as financial advisor to the Debtors since September 2024.

To fund the cases, the Debtors have secured a commitment from their prepetition lenders for up to $19 million in new money DIP financing. Up to $9.5 million is available upon entry of the interim order, with the remainder available upon entry of the final order. The facility bears interest at a fixed rate of 13% per annum, matures five months from closing, and provides for a roll-up of a portion of the prepetition Credit Agreement obligations on a pro rata basis as new money is funded.

The company reports $10 million to $50 million in assets and $100 million to $500 million in liabilities. The filing indicates that there will be funds available for distribution to unsecured creditors. The case number is 26-11360.

⁽¹⁾ OnkosXcel Employee Holdings, LLC and OnkosXcel Therapeutics, LLC.

Top Unsecured Claims

Form 204 Top Unsecured Claims
Source: Bondoro, Court filings

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