Heron Therapeutics adopts tax benefits preservation plan

Heron Therapeutics (HRTX) announced that its Board of Directors has adopted a Section 382 rights plan designed to protect the availability and significant potential value of the Company’s net operating loss carryforwards, or NOLs, and other tax attributes, which may be used to offset future taxable income. The Board unanimously approved the adoption of the Rights Plan. In addition, the Rights Plan satisfies the covenant to preserve the NOLs pursuant to the Company’s Note Purchase Agreement with Rubric Capital Management dated August 8. The Rights Plan is effective August 14. As of December 31, 2024, Heron had approximately $1.37B of U.S. federal NOLs, which may be available to offset future taxable income, and enhance cash flow as the Company executes its growth strategy. However, the Company’s ability to use these NOLs would be substantially limited if it experienced an “ownership change” under Section 382 of the Internal Revenue Code.