La Jolla Pharmaceutical Company (Nasdaq:LJPC) (La Jolla), a leader
in the discovery, development and commercialization of innovative
therapies intended to significantly improve outcomes in patients
suffering from life-threatening diseases, today announced that it
has closed a $125 million royalty financing agreement
with HealthCare Royalty Partners (HCR).
Under the terms of the agreement, La Jolla will receive $125
million in exchange for tiered royalty payments on worldwide net
sales of GIAPREZA. Payments under the agreement start annually at a
maximum royalty rate, with step-downs based on the achievement of
annual net sales thresholds. Through December 31, 2021, the royalty
rate will be a maximum of 10%. Starting January 1, 2022, the
maximum royalty rate may increase by 4% if an agreed-upon,
cumulative sales threshold has not been met, and, starting January
1, 2024, the maximum royalty rate may increase by an additional 4%
if a different agreed-upon cumulative sales threshold has not been
met. The agreement is subject to maximum aggregate royalty payments
to HCR of 180% of the $125 million to be received by La Jolla, at
which time the payment obligations under the agreement would
expire. The agreement was entered into by La Jolla’s wholly owned
subsidiary, La Jolla Pharma, LLC, and HCR has no recourse under the
agreement against La Jolla or any assets other than GIAPREZA.
On a pro-forma basis, adjusting for the net proceeds from this
transaction, La Jolla’s cash and cash equivalents as of March 31,
2018 were $279 million.
“This transaction provides us with a strong financial position
to support the commercial launch of GIAPREZA, while at the same
time furthering the development of LJPC-401 and our other
programs,” said George F. Tidmarsh, M.D., Ph.D., President and
Chief Executive Officer of La Jolla.
“We are pleased to partner with La Jolla,” said Clarke Futch,
Managing Partner and Chairman of the Investment Committee of HCR.
“Our investment reflects our confidence in GIAPREZA’s ability to
meaningfully improve outcomes for patients suffering from septic or
other distributive shock.”
About GIAPREZA
In December 2017, GIAPREZA™ (angiotensin II) was approved
by the U.S. Food and Drug Administration (FDA) to
increase blood pressure in adults with septic or other distributive
shock. GIAPREZA mimics the body’s endogenous regulatory peptide
that is central to the renin-angiotensin-aldosterone system to
increase blood pressure. Prescribing information for GIAPREZA is
available at www.giapreza.com.
IMPORTANT SAFETY INFORMATION
Contraindications
None
Warnings and Precautions
There is a potential for venous and arterial thrombotic and
thromboembolic events in patients who receive GIAPREZA. Use
concurrent venous thromboembolism (VTE) prophylaxis.
Adverse Reactions
The most common adverse reactions that were reported in greater
than 10% of GIAPREZA-treated patients were thromboembolic
events.
Drug Interactions
Angiotensin converting enzyme (ACE) inhibitors may increase
response to GIAPREZA.Angiotensin II receptor blockers (ARB) may
reduce response to GIAPREZA.
You are encouraged to report negative side effects of
prescription drugs to the FDA. Visit www.fda.gov/medwatch
or call 1-800-FDA-1088.
For additional information, please see Full
Prescribing Information.
About Shock and Septic or Other Distributive
Shock
Over 1 million Americans are affected by shock on an annual
basis, with 1 in 3 patients being treated for shock in the
intensive care unit. Distributive shock is the most common type of
shock in the inpatient setting with approximately 800,000
distributive shock cases in the United States per year. Of these
cases, an estimated 90% are septic shock patients. Approximately
300,000 do not achieve adequate blood pressure response with
standard of care vasopressor therapy (catecholamines and
vasopressin). The inability to achieve or maintain adequate blood
pressure results in inadequate blood flow to the body’s organs and
tissue and is associated with a mortality rate exceeding most acute
conditions requiring hospitalization.
About HealthCare Royalty Partners
HealthCare Royalty Partners (HCR) is a private investment firm that
purchases royalties and uses debt-like structures to invest in
commercial or near-commercial stage life science assets. HCR
has $3.7 billion in cumulative capital commitments with
offices in Stamford (CT), San Francisco, Boston and
London. For more information,
visit www.healthcareroyalty.com.
About La Jolla Pharmaceutical Company
La Jolla Pharmaceutical Company is a biopharmaceutical
company focused on the discovery, development and commercialization
of innovative therapies intended to significantly improve outcomes
in patients suffering from life-threatening diseases.
GIAPREZA™ (angiotensin II), formerly known as LJPC-501, was
approved by the U.S. Food and Drug Administration
(FDA) on December 21, 2017 as a vasoconstrictor to
increase blood pressure in adults with septic or other distributive
shock. LJPC‑401 (synthetic human hepcidin), a clinical-stage
investigational product, is being developed for the potential
treatment of conditions characterized by iron overload, such as
hereditary hemochromatosis, beta thalassemia, sickle cell disease
and myelodysplastic syndrome. For more information, please
visit www.ljpc.com.
Forward-looking Statements
This press release contains forward-looking statements, as that
term is defined in the Private Securities Litigation Reform Act of
1995. These statements relate to expectations regarding future
events or La Jolla’s future results of operations. These statements
are only predictions or statements of current expectations and
involve known and unknown risks, uncertainties and other factors
that may cause actual results to be materially different from those
anticipated by the forward-looking statements. La Jolla cautions
readers not to place undue reliance on any such forward-looking
statements, which speak only as of the date they were made. Certain
of these risks, uncertainties and other factors are described in
greater detail in La Jolla’s filings with the U.S. Securities and
Exchange Commission (SEC), all of which are available free of
charge on the SEC’s website www.sec.gov. These risks include,
but are not limited to, risks relating to: unforeseen safety issues
from the administration of GIAPREZA in patients; the anticipated
treatment of future clinical data by the FDA, the EMA or other
regulatory authorities; potential market sizes, including for
septic or other distributive shock; our ability to successfully
commercialize, market and achieve market acceptance of GIAPREZA;
the development of La Jolla’s other products; the expected duration
over which La Jolla’s cash balances will fund its operations; and
other risks and uncertainties identified in our filings with the
SEC. La Jolla expressly disclaims any intent to update any
forward‑looking statements to reflect the outcome of subsequent
events.
Company Contacts
Sandra VedrickDirector, Investor Relations & Human
ResourcesLa Jolla Pharmaceutical CompanyPhone: (858) 207-4264 Ext:
1135Email: svedrick@ljpc.com
and
Dennis M. MulroyChief Financial OfficerLa Jolla Pharmaceutical
CompanyPhone: (858) 207-4264 Ext: 1040Email: dmulroy@ljpc.com
Media Contact
Sylvia WheelerWheelhouse Life Science AdvisorsPhone: (925)
785-5311 Email: swheeler@wheelhouselsa.com
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