TIDMPRTC
RNS Number : 9328T
PureTech Health PLC
23 March 2023
23 March 2023
PureTech Health plc
PureTech Health and Royalty Pharma Enter into KarXT Royalty
Agreement for up to $500 Million
Royalty Pharma has acquired an interest in PureTech's royalty in
Karuna Therapeutics' KarXT ; Royalty Pharma and PureTech will share
in royalties above certain annual sales thresholds.
PureTech retains its current equity stake in Karuna in addition
to milestone payments and 20% of sublicense revenues due to
PureTech.
Transaction provides further non-dilutive capital for PureTech's
growing and rapidly advancing Wholly Owned Pipeline, with five
clinical-stage candidates expected by the end of 2023.
PureTech Health plc (Nasdaq: PRTC, LSE: PRTC) ("PureTech" or the
"Company"), a clinical-stage biotherapeutics company dedicated to
changing the treatment paradigm for devastating diseases, and
Royalty Pharma (Nasdaq: RPRX), the largest buyer of
biopharmaceutical royalties and a leading funder of innovation
across the life sciences industry, today announced that Royalty
Pharma has acquired an interest in PureTech's royalty in Karuna
Therapeutics' KarXT for up to $500 million, with $100 million in
cash up front and up to $400 million in additional payments
contingent on the achievement of certain regulatory and commercial
milestones.
"We are delighted to partner with PureTech, which began a
remarkable innovation story with KarXT that has demonstrated an
impressive clinical profile in Phase 3," said Pablo Legorreta,
Royalty Pharma's Founder and Chief Executive Officer. "We believe
this important therapy will have a significant impact on patients
with schizophrenia if approved by the FDA. This medicine is a
notable addition to our royalty portfolio and is well aligned with
our strategy of investing in breakthrough therapies that address
areas of high unmet medical need."
"We've seen extraordinary clinical success demonstrated by
KarXT, which, if approved, will be the first new mechanism for
treating schizophrenia in more than fifty years. KarXT has now
demonstrated efficacy in registration enabling studies and is
heralded as a potential treatment paradigm shift that could impact
millions of patients," said Daphne Zohar, Founder and Chief
Executive Officer of PureTech. "This agreement will provide
PureTech with additional non-dilutive capital to advance our Wholly
Owned Pipeline, including our rapidly maturing clinical programs,
towards potential commercialization. Such non-dilutive sources of
capital have allowed us to fund our pipeline and operations without
having to raise capital from the public markets in over five years,
and we are pleased to be able to benefit from the success of our
invented programs."
As part of this transaction, PureTech has sold its right to
receive a 3% royalty from Karuna to Royalty Pharma on sales up to
$2 billion annually, after which threshold Royalty Pharma will
receive 33% and PureTech will retain 67% of the royalty payments.
PureTech retains its 3.1% equity ownership in Karuna. [1]
Additionally, under its license agreement with Karuna, PureTech
retains the right to receive milestone payments upon the
achievement of certain regulatory approvals and 20% of sublicense
income.
KarXT was invented by a team at PureTech, including its Chief
Innovation Officer, Eric Elenko, Ph.D., who served as the founding
CEO of Karuna Therapeutics. KarXT is an oral, investigational
M1/M4-preferring muscarinic agonist in development for the
treatment of psychiatric and neurological conditions, including
schizophrenia as a monotherapy and adjunctive therapy and psychosis
in Alzheimer's disease. Karuna has announced that it plans to
submit a New Drug Application for KarXT in schizophrenia to the
U.S. Food and Drug Administration (FDA) in mid-2023.
Sills Cummis & Gross P.C., acted as legal advisors to
PureTech and Gibson, Dunn & Crutcher, LLP, Jones Day and
Maiwald GmbH acted as legal advisors to Royalty Pharma.
About PureTech's Wholly Owned Pipeline
In addition to the excellent progress across its Founded
Entities, PureTech's Wholly Owned Pipeline is rapidly advancing,
and the Company's operational runway, including its $341.4 million
Cash and Cash Equivalents as of June 30, 2022, not including this
transaction, is expected to support this growth into the first
quarter of 2026. PureTech's pipeline is comprised of six
therapeutic candidates, four of which are currently clinical stage,
including one partnered program. These candidates are centered on a
strategy of leveraging validated biology to rapidly advance
therapeutics with proven efficacy. Several upcoming milestones are
anticipated for these candidates, including the following:
-- LYT-100 (deupirfenidone) is in development for the potential
treatment of conditions involving inflammation and fibrosis,
including idiopathic fibrosis (IPF), for which current standards of
care are associated with significant tolerability issues, resulting
in approximately three out of four patients in the U.S. foregoing
treatment with these otherwise efficacious medicines. [2] LYT-100
is a deuterated form of one of the two standard of care treatments,
pirfenidone, which has proven efficacy and has been shown to
improve survival in these patients by approximately three years,
but its side effects cause patients to discontinue or dose reduce,
thereby limiting its effectiveness. [3] LYT-100 has shown a 50%
reduction in gastrointestinal tolerability issues in a head-to-head
study versus pirfenidone, and it can be dosed at a higher exposure
level, but with a lower Cmax, than the FDA-approved dosage of
pirfenidone, potentially enabling improved efficacy. PureTech is
currently evaluating two doses of LYT-100, one with comparable
exposure to the approved dose of pirfenidone and one with a higher
level of exposure, in a global, randomized double blind,
placebo-controlled trial in patients with IPF, which is expected to
serve as the first of two registration enabling trials. As
previously noted, the Company has taken measures to accelerate
enrollment. Topline results are now expected in 2024.
-- LYT-300 (oral allopregnanolone) is in development for the
potential treatment of anxiety disorders and postpartum depression
(PPD) where there is a need for more effective treatments that work
quickly, have more favorable tolerability and can be administered
orally. A placebo-controlled, Phase 2a, proof-of-concept trial
using a validated clinical model of anxiety in healthy volunteers
is expected to begin in the first half of 2023, with topline
results anticipated by the end of 2023. An open-label, Phase 2a,
proof-of-concept clinical trial in women with PPD is expected to
initiate in the second half of 2023.
-- LYT-200 (anti-galectin-9 mAb) is in development for the
potential treatment of metastatic solid tumors that have poor
survival rates as well as hematological malignancies, such as acute
myeloid leukemia (AML), where more than 50% of patients either
don't respond to initial treatment or experience relapse after
responding to initial treatment. [4] PureTech recently initiated a
Phase 1b trial in acute myeloid leukemia, and initial results are
expected by the end of 2023. PureTech also recently initiated a
Phase 1b trial of LYT-200 in combination with an anti PD-1
antibody, tislelizumab, in patients with urothelial or head and
neck cancer. Topline results are expected in 2024.
-- LYT-310 (oral cannabidiol [CBD]) is in development to expand
the therapeutic application of CBD across a range of epilepsies and
neurological disorders. LYT-310 is designed to enable oral
administration of CBD in a capsule; expand the use of CBD into a
broad range of therapeutic areas and patient populations (such as
adolescents and adults) where higher doses are required to achieve
a therapeutic effect; potentially improve safety and reduce
gastrointestinal (GI) tract side effects that are associated with
the currently approved CBD-based treatment by reducing GI and liver
exposure; and allow for a readily scalable, consistent product in a
cost-effective manner. LYT-310 is expected to enter the clinic in
the fourth quarter of 2023.
About PureTech
PureTech is a biotherapeutics company dedicated to changing the
treatment paradigm for devastating diseases. The Company has
created a broad and deep pipeline through the expertise of its
experienced research and development team and its extensive network
of scientists, clinicians and industry leaders. This pipeline,
which is being advanced both internally and through PureTech's
Founded Entities, is comprised of 26 therapeutics and therapeutic
candidates, including two (Plenity(R) and EndeavorRx(R)) that have
received both U.S. FDA clearance and European marketing
authorization and a third (KarXT) that will soon be filed for FDA
approval, as of the most recent update by the Company. All of the
underlying programs and platforms that resulted in this pipeline of
therapeutic candidates were initially identified or discovered and
then advanced by the PureTech team through key validation points
based on its unique insights and technology platforms.
For more information, visit www.puretechhealth.com or connect with us on Twitter @puretechh.
About Royalty Pharma
Founded in 1996, Royalty Pharma is the largest buyer of
biopharmaceutical royalties and a leading funder of innovation
across the biopharmaceutical industry, collaborating with
innovators from academic institutions, research hospitals and
non-profits through small and mid-cap biotechnology companies to
leading global pharmaceutical companies. Royalty Pharma has
assembled a portfolio of royalties which entitles it to payments
based directly on the top-line sales of many of the industry's
leading therapies. Royalty Pharma funds innovation in the
biopharmaceutical industry both directly and indirectly - directly
when it partners with companies to co-fund late-stage clinical
trials and new product launches in exchange for future royalties,
and indirectly when it acquires existing royalties from the
original innovators. Royalty Pharma's current portfolio includes
royalties on more than 35 commercial products, including Vertex's
Trikafta, Kalydeco, Orkambi and Symdeko, Biogen's Tysabri, AbbVie
and Johnson & Johnson's Imbruvica, Astellas and Pfizer's
Xtandi, GSK's Trelegy, Novartis' Promacta, Pfizer's Nurtec ODT,
Johnson & Johnson's Tremfya, Roche's Evrysdi, Gilead's
Trodelvy, and 10 development-stage product candidates.
PureTech Cautionary Note Regarding Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. All statements contained in this press release that do not
relate to matters of historical fact should be considered
forward-looking statements, including without limitation those
statements related to the terms of the agreement with Royalty
Pharma for the Karuna royalties, KarXT, its development, clinical
milestones and potential therapeutic applications, PureTech's
Wholly Owned Pipeline and the development, clinical milestones and
potential therapeutic applications associated with its candidates,
and our future prospects, developments, and strategies. The
forward-looking statements are based on current expectations and
are subject to known and unknown risks, uncertainties and other
important factors that could cause actual results, performance and
achievements to differ materially from current expectations,
including, but not limited to, those risks, uncertainties and other
important factors described under the caption "Risk Factors" in our
Annual Report on Form 20-F for the year ended December 31, 2021
filed with the SEC and in our other regulatory filings. These
forward-looking statements are based on assumptions regarding the
present and future business strategies of the Company and the
environment in which it will operate in the future. Each
forward-looking statement speaks only as at the date of this press
release. Except as required by law and regulatory requirements, we
disclaim any obligation to update or revise these forward-looking
statements, whether as a result of new information, future events
or otherwise.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 which forms part of
UK domestic law by virtue of the European Union (Withdrawal) Act
2018 ('MAR'). Upon the publication of this announcement via a
Regulatory Information Service ('RIS'), this inside information is
now considered to be in the public domain.
Royalty Pharma Forward-Looking Statements
The information set forth herein does not purport to be complete
or to contain all of the information you may desire. Statements
contained herein are made as of the date of this document unless
stated otherwise, and neither the delivery of this document at any
time, nor any sale of securities, shall under any circumstances
create an implication that the information contained herein is
correct as of any time after such date or that information will be
updated or revised to reflect information that subsequently becomes
available or changes occurring after the date hereof. This document
contains statements that constitute "forward-looking statements" as
that term is defined in the United States Private Securities
Litigation Reform Act of 1995, including statements that express
the company's opinions, expectations, beliefs, plans, objectives,
assumptions or projections regarding future events or future
results, in contrast with statements that reflect historical facts.
Examples include discussion of Royalty Pharma's strategies,
financing plans, growth opportunities and market growth. In some
cases, you can identify such forward-looking statements by
terminology such as "may," "might," "will," "should," "expects,"
"plans," "anticipates," "believes," "estimates," "target,"
"forecast," "guidance," "goal," "predicts," "project," "potential"
or "continue," the negative of these terms or similar expressions.
Forward-looking statements are based on management's current
beliefs and assumptions and on information currently available to
the company. However, these forward-looking statements are not a
guarantee of Royalty Pharma's performance, and you should not place
undue reliance on such statements. Forward-looking statements are
subject to many risks, uncertainties and other variable
circumstances, and other factors. Such risks and uncertainties may
cause the statements to be inaccurate and readers are cautioned not
to place undue reliance on such statements. Many of these risks are
outside of Royalty Pharma's control and could cause its actual
results to differ materially from those it thought would occur. The
forward-looking statements included in this document are made only
as of the date hereof. Royalty Pharma does not undertake, and
specifically declines, any obligation to update any such statements
or to publicly announce the results of any revisions to any such
statements to reflect future events or developments, except as
required by law. Certain information contained in this document
relates to or is based on studies, publications, surveys and other
data obtained from third-party sources and Royalty Pharma's own
internal estimates and research. While Royalty Pharma believes
these third-party sources to be reliable as of the date of this
document, it has not independently verified, and makes no
representation as to the adequacy, fairness, accuracy or
completeness of, any information obtained from third-party sources.
In addition, all of the market data included in this document
involves a number of assumptions and limitations, and there can be
no guarantee as to the accuracy or reliability of such assumptions.
Finally, while the company believes its own internal research is
reliable, such research has not been verified by any independent
source. For further information, please reference Royalty Pharma's
reports and documents filed with the U.S. Securities and Exchange
Commission ("SEC") by visiting EDGAR on the SEC's website at
www.sec.gov.
Contact:
PureTech
Public Relations
publicrelations@puretechhealth.com
Investor Relations
IR@puretechhealth.com
EU Media
Ben Atwell, Rob Winder
+44 (0) 20 3727 1000
ben.atwell@FTIconsulting.com
U.S. Media
Nichole Sarkis
+1 774 278 8273
nichole@tenbridgecommunications.com
Royalty Pharma Investor Relations and Communications
+1 (212) 883-6772
ir@royaltypharma.com
[1] As of February 23, 2023
[2] Dempsey, T. M., Payne, S., Sangaralingham, L., Yao, X.,
Shah, N. D., & Limper, A. H. (2021). Adoption of the
Antifibrotic Medications Pirfenidone and Nintedanib for Patients
with Idiopathic Pulmonary Fibrosis. Annals of the American Thoracic
Society, 18(7), 1121-1128.
https://doi.org/10.1513/AnnalsATS.202007-901OC
[3] Margaritopoulos, G. A., Trachalaki, A., Wells, A. U.,
Vasarmidi, E., Bibaki, E., Papastratigakis, G., Detorakis, S.,
Tzanakis, N., & Antoniou, K. M. (2018). Pirfenidone improves
survival in IPF: results from a real-life study. BMC pulmonary
medicine, 18(1), 177. https://doi.org/10.1186/s12890-018-0736-z
[4] Walter, R. B., Othus, M., Burnett, A. K., Löwenberg, B.,
Kantarjian, H. M., Ossenkoppele, G. J., Hills, R. K., Ravandi, F.,
Pabst, T., Evans, A., Pierce, S. R., Vekemans, M. C., Appelbaum, F.
R., & Estey, E. H. (2015). Resistance prediction in AML:
analysis of 4601 patients from MRC/NCRI, HOVON/SAKK, SWOG and MD
Anderson Cancer Center. Leukemia, 29(2), 312-320.
https://doi.org/10.1038/leu.2014.242
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