Hercules Capital (NYSE: HTGC) has provided a senior secured term loan facility of up to $150m to New Jersey-based Rocket Pharmaceuticals (Nasdaq: RCKT), a commercial-stage gene therapy company, under a loan and security agreement signed on 30 September 2026. Hercules is administrative agent, collateral agent and lender, with Hercules-affiliated funds also participating.
The facility is structured in five tranches. Rocket drew $35m at closing. It may draw $20m at its option to 30 June 2027. A further $15m is available at its option to 30 September 2027 once the $20m is drawn or expires. Rocket may also draw $30m at its option on positive registrational Danon data, or positive interim pivotal Phase 2 data supporting a Biologics License Application (BLA) filing. Up to $50m is available at the discretion of the lenders' investment committee.
The facility matures on 1 October 2030, extendable to 1 October 2031 if the Danon milestone is met. Rocket has an interest-only period to 1 April 2029, equal to about 30 months, which can extend to 1 April 2030 on the milestone and to 1 October 2030 on US Food and Drug Administration (FDA) approval of RP-A501.
Interest floats at the greater of prime and 6.75%, plus 2.40%. The loans are secured by a first-priority lien on substantially all of Rocket's assets, including intellectual property.
Hercules and its affiliated lenders received warrants to purchase up to 1,755,853 Rocket shares at $2.99, exercisable pro rata as loans are drawn, including 409,699 shares exercisable after the first $35m. The warrants have a seven-year term. The agreement also includes a minimum cash covenant of 35% to 75% of outstanding loans, depending on Danon milestones, with the first test no earlier than 1 July 2027 and no testing while Rocket's market capitalisation exceeds $600m.
Rocket had $283.7m in cash, cash equivalents and investments at 30 June 2026. The company expects the first $35m draw to fund operations into the third quarter of 2028, with further draws able to extend its runway into 2029, subject to borrowing conditions, timing and spending.
The FDA granted accelerated approval in March 2026 to Kresladi, Rocket's gene therapy for severe leukocyte adhesion deficiency-I. Rocket sold the rare paediatric disease priority review voucher received with that approval for $180m, with the sale closing in June 2026, and has not yet generated product revenue.
Rocket chief executive Gaurav Shah said: “Building on the sale of our priority review voucher, this financing diversifies our sources of capital and strengthens our ability to execute and deliver on our cardiovascular strategy.”
LifeSci Capital acted as financial adviser to Rocket, while PJT served as capital markets adviser.
Hercules Capital is a business development company focused on technology and life sciences lending. It had about $6.1bn of assets under management at 30 June 2026 and reported $2.74bn of new debt and equity commitments in the first half of 2026.