#USA #CARY #Heron Therapeutics #NOL Preservation #Rights Plan

Heron Therapeutics Adopts Rights Plan to Safeguard NOL Assets

Heron Therapeutics, Inc., a biotechnology firm listed on Nasdaq under the ticker HRTX, recently unveiled an important strategic initiative. The company’s Board of Directors has approved the implementation of a Section 382 rights plan aimed at protecting its net operating loss carryforwards (NOLs) and other tax attributes. This plan is pivotal as it ensures that Heron can leverage approximately $1.37 billion in U.S. federal NOLs to offset future taxable income while enhancing cash flow as the company moves forward with its growth strategy.

The Board's unanimous decision comes following careful consideration of the potential risks involved. An ownership change under Section 382 of the Internal Revenue Code could significantly limit the company’s ability to utilize these NOLs, thus diminishing shareholder value. Therefore, the Rights Plan introduces measures to deter any single investor or group from acquiring a beneficial ownership of 4.99% or more in Heron’s outstanding shares. It is designed to safeguard these valuable assets, which may be crucial for Heron's plans to execute both organic and inorganic growth initiatives.

Effective as of August 14, 2025, this measure aligns with the obligations outlined in the company’s Note Purchase Agreement with Rubric Capital Management, further emphasizing Heron’s commitment to preserving its financial health and stability. The Rights Plan is valid for one year, unless the Board decides to terminate or extend it sooner.

Chairman of the Board Adam Morgan expressed optimism regarding the implementation of this plan. He stated, “Adopting the Section 382 Rights Plan is intended solely to protect the significant potential value of the Company's NOLs, which we believe can offset pre-tax income as the Company executes its near-term and long-term organic and inorganic growth plan.” Morgan’s remarks signal a positive outlook on Heron's strategy to create a more sustainable future for the company and its stakeholders.

Strategic Importance of NOLs

Net Operating Losses can be a significant asset for corporations, allowing them to carry forward losses to offset future taxable income. For Heron, whose primary focus is on improving patient outcomes through therapeutic innovations, the availability of $1.37 billion in federal NOLs represents a critical financial cushion. This funding flexibility can enhance their capacity for ongoing investments in research and development as well as market expansion initiatives, ultimately leading to better healthcare solutions for patients in acute care and oncology.

Looking Forward

Heron Therapeutics is adamant about using this strategy to maintain its competitive edge in the biotechnology space. The company’s commitment to developing ground-breaking therapies can be significantly enhanced through effective tax strategies like this Rights Plan. Furthermore, by safeguarding its NOLs, Heron positions itself to navigate potential market uncertainties and realize sustainable growth in the future.

To keep shareholders and the public informed, Heron will file a Current Report on Form 8-K with the Securities and Exchange Commission detailing the provisions of the Rights Plan and the associated rights. With this proactive approach to risk management, Heron Therapeutics continues to focus on its mission to enhance medical care through innovative research and development.

In conclusion, Heron Therapeutics has taken a significant step by implementing a rights plan to protect its NOL assets and shareholder value. It underscores the company’s commitment to long-term stability and growth, ultimately ensuring that it can continue to deliver on its promise to improve the lives of patients through innovative solutions.