One of the best-known patent royalty securitizations, BioPharma Royalty Trust, will likely enter into early amortization following the third quarter trustee report due at the end of November.

Based on projections associated with Bristol-Myers Squibb Co.'s financial statements and reports, Standard & Poor's expects BioPharma's $57.15 million A' rated senior notes to breach covenants for the third consecutive reporting period, considered a trigger event per the deal documentation. Cashflow to the mezzanine tranche has already fallen short, with the damage absorbed by ZC Specialty Insurance Co., a subsidiary of Center Re., and guarantor for those notes. The mezzanine tranche, worth $22 million, is rated AA-' based on the guaranty.

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