KemPharm, Inc. (NasdaqGS: KMPH) (KemPharm, or the Company), a
specialty pharmaceutical company focused on the discovery and
development of novel treatments for rare central nervous system
(CNS) diseases, today announced a definitive agreement with
Orphazyme A/S (in reconstruction) (ORPHA.CO; ORPH) (Orphazyme) to
acquire arimoclomol, an orally-delivered, first-in-class heat shock
protein (HSP) amplifier being developed as a treatment for
Niemann-Pick disease type C (NPC). NPC is a rare progressive
neurodegenerative disease that impacts children, adolescents, and
adults, and is characterized by an inability of the body to
transport cholesterol and lipids inside of cells, which leads to
the abnormal accumulation of these substances within various
tissues of the body, including the brain. Arimoclomol is currently
being made available to NPC patients in the U.S., France and
Germany under Orphazyme’s Early Access Programs (EAP).
Under the terms of the agreement, KemPharm will
purchase substantially all of the assets and operations of
Orphazyme, including arimoclomol, for a cash payment of USD $12.8
million. The Company expects to finance the cash payment with a
revolving line of credit secured by KemPharm’s balance sheet.
KemPharm intends to retain the majority of Orphazyme’s current
employees. In addition, KemPharm has agreed to assume an estimated
reserve liability equal to approximately USD $5.2 million, which is
an estimated future rebate due to the French regulatory authorities
based on the revenue generated from the EAP in France. For the year
ending December 31, 2022, the EAP is expected to generate at least
USD $12 million in revenue based upon enrollment in France as of
March 2022. The EAP is expected to remain in place until
arimoclomol becomes commercially available in each of the current
EAP markets. The transaction is expected to close on or before June
1, 2022, subject to customary closing conditions and approval by
Orphazyme’s creditors and the Danish bankruptcy court. Canaccord
Genuity LLC acted as a strategic advisor to KemPharm for the
transaction.
“This strategic acquisition of arimoclomol is a
transformative event that significantly expands our rare CNS
disease development pipeline, bringing to KemPharm an NDA-stage,
revenue-generating product upon which we intend to build commercial
capabilities that allow KemPharm to create and retain value for the
benefit of shareholders,” stated Richard Pascoe, Executive Chairman
of KemPharm. “Moreover, the financial structure of the acquisition
combined with the revenue currently being generated by arimoclomol
from the early access program in France affords us the opportunity
to acquire the asset in a capital efficient manner that has the
potential to create positive cash flow, while incurring no
shareholder dilution.”
Arimoclomol is administered orally and has been
studied in ten Phase 1, four Phase 2, and three pivotal Phase 2/3
trials. Arimoclomol has received Orphan Drug Designation (ODD) for
NPC in the United States and the European Union. Arimoclomol has
received Fast-Track Designation (FTD), Breakthrough Therapy
Designation (BTD), and Rare Pediatric Disease Designation (RPDD)
from the FDA for NPC. If approved in the U.S., arimoclomol would
also be eligible to receive a Pediatric Priority Review Voucher. On
June 17, 2021, Orphazyme received a Complete Response Letter (CRL)
from the FDA regarding its NDA for arimoclomol for the treatment of
NPC. Orphazyme also withdrew its European Marketing Authorisation
Application (MAA) for arimoclomol for the treatment of NPC ahead of
a final vote and opinion by the Committee for Medicinal Products
for Human Use (CHMP).
“The acquisition of arimoclomol aligns perfectly
with our strategy to build KemPharm’s value via the advancement and
commercialization of novel treatments that address rare CNS
conditions, including our lead clinical candidate, KP1077 in
idiopathic hypersomnia,” stated Travis Mickle, Ph.D., President and
Chief Executive Officer of KemPharm. “We have carefully evaluated
the CRL issued by the FDA and the minutes from the subsequent Type
A meeting, as well as the data that has been generated from the
development work performed to date. We believe the efficacy signal
for arimoclomol in NPC is convincing and that there is a viable
regulatory path that could enable a successful NDA resubmission.
KemPharm has significant experience with challenging regulatory
situations, having successfully led or participated in three FDA
product approvals, two of which followed an initial CRL. We welcome
the opportunity to work with the FDA on the resubmission of the NDA
for arimoclomol in NPC, which we expect to file as early as the
first quarter of 2023.”
NPC is a rare progressive lysosomal storage
disorder characterized by an inability of the body to transport
cholesterol and lipids inside of cells. This leads to dysfunction
in organs such as the brain, spleen and liver. NPC can range from a
fatal disorder within the first few months after birth (neonatal
period) to a late onset, chronic progressive disorder that remains
undiagnosed well into adulthood. Disease progression is
irreversible in all patients, and loss of neuro-cognitive function
adversely impacts their daily life. The mean age of death is 13
years (Bianconi, 2019), and there are no approved treatments for
NPC in the United States.
“NPC is an ultra-rare, inherited
neurodegenerative disease that affects people of all ages from
infancy to adulthood, and leads to progressive impairment of
mobility, cognition, speech, and swallowing, culminating in
premature death,” said Marc Patterson, MD, Professor of Neurology,
Pediatrics and Medical Genetics at Mayo Clinic. “Therapies to
treat NPC are desperately needed, and there is hope that a
treatment such as arimoclomol could provide a solution to patients
around the world who are living daily with the disease. It is
encouraging that there is an opportunity to continue the regulatory
process for arimoclomol with the FDA.”
Conference Call
Information:
KemPharm will host a conference call and live
audio webcast with a slide presentation today at 8:30 a.m., EDT.
Interested participants and investors may access the conference
call by dialing either:
- (833) 793-7231 (U.S.)
- (614) 999-1675 (international)
- Conference ID: 7880862
An audio webcast with slide presentation will be
accessible via the Investor Relations section of the Company’s
website, http://investors.kempharm.com/. An archive of the
webcast and presentation will be available for 90 days beginning at
approximately 9:30 a.m. EDT, on May 16, 2022.
About KemPharm:
KemPharm is a specialty pharmaceutical company
focused on the discovery and development of novel treatments for
rare central nervous system (CNS) diseases through its proprietary
LAT® (Ligand Activated Therapy) platform technology. KemPharm
utilizes its proprietary LAT® platform technology to generate
improved prodrug versions of FDA-approved drugs as well as to
generate prodrug versions of existing compounds that may have
applications for new disease indications. KemPharm’s prodrug
product candidate pipeline is focused on the high need areas of
idiopathic hypersomnia (IH) and other CNS/rare diseases. In
addition, the U.S. Food and Drug Administration (FDA) has approved
AZSTARYS®, a new once-daily treatment for ADHD in patients age six
years and older containing KemPharm’s prodrug,
serdexmethylphenidate (SDX), which is being commercialized by
Corium, Inc. in the U.S., and APADAZ®, an immediate-release
combination product containing benzhydrocodone, KemPharm’s prodrug
of hydrocodone, and acetaminophen, which is being commercialized by
KVK-Tech, Inc. in the U.S. For more information on KemPharm and its
pipeline of prodrug product candidates visit www.kempharm.com or
connect with us on Twitter, LinkedIn, Facebook and YouTube.
Caution Concerning Forward Looking
Statements:
This press release may contain forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements include all
statements that do not relate solely to historical or current
facts, including without limitation and which can be identified by
the use of words such as “may,” “will,” “expect,” “project,”
“estimate,” “anticipate,” “plan,” “believe,” “potential,” “should,”
“continue,” “could,” “intend,” “target,” “predict,” or the negative
versions of those words or other comparable words or expressions,
although not all forward-looking statements contain these
identifying words or expressions. Forward-looking statements are
not guarantees of future actions or performance. These
forward-looking statements include statements regarding the
expected closing of KemPharm’s acquisition of arimoclomol,
including the timing and financing thereof, the acquisition’s
impact on KemPharm’s operations and financial results, the expected
revenue from the EAP and the timing or results of an NDA
resubmission for arimoclomol. These forward-looking statements are
based on information currently available to KemPharm and its
current plans or expectations and are subject to a number of known
and unknown uncertainties, risks and other important factors that
may cause our actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. These and other important factors are described in
detail in the “Risk Factors” section of KemPharm’s Annual Report on
Form 10-K for the year ended December 31, 2021, as updated by the
Quarterly Report on Form 10-Q for the three months ended March 31,
2022, and KemPharm’s other filings with the Securities and Exchange
Commission.
While we may elect to update such
forward-looking statements at some point in the future, except as
required by law, we disclaim any obligation to do so, even if
subsequent events cause our views to change. Although we believe
the expectations reflected in such forward-looking statements are
reasonable, we can give no assurance that such expectations will
prove to be correct. These forward-looking statements should not be
relied upon as representing our views as of any date subsequent to
the date of this press release.
This press release also may contain estimates
and other statistical data made by independent parties and by us
relating to market size and other data about our industry. This
data involves a number of assumptions and limitations, and you are
cautioned not to give undue weight to such estimates. In addition,
projections, assumptions and estimates of our future performance
and the future performance of the markets in which we operate are
necessarily subject to a high degree of uncertainty and risk.
KemPharm Contacts:
Tiberend Strategic Advisors, Inc.Jason
Rando/Daniel Kontoh-Boateng
jrando@tiberend.comdboateng@tiberend.com
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