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Full Deal Summary

Santhera Pharmaceuticals AG acquired the option to exclusively sublicense Idorsia Pharmaceuticals Ltd.'s dissociative steroid vamorolone (VBP15) in all countries worldwide except Japan and South Korea.

Vamorolone--in Phase IIb for Duchenne muscular dystrophy (DMD)--originated with ReveraGen BioPharma, which licensed Actelion Pharmaceuticals the option for exclusive worldwide rights under a 2016 deal. As a condition of Actelion's acquisition by J&J the following year, Actelion divested its discovery and early-phase development assets (including vamorolone) into a newly formed company (Idorsia), to which all rights and the option under the ReveraGen agreement (including Idorsia's responsibility for all future payments and royalties) transferred. Through Idorsia's current deal with Santhera, the latter now gains the option to exclusively sublicense worldwide rights (except in the designated territories) to vamorolone in all indications. Idorsia takes a 13.3% equity stake in Santhera (through the purchase of 1mm new registered Santhera shares, valued at $15.95mm based on Santhera's 10-day pre-announcement average). The shares issued to Idorsia will be subject to a lock-up expiring if and when vamorolone receives US marketing authorization in DMD. In addition, Idorsia gets $20mm in up-front cash ($15mm of which is intended to fund the ongoing Phase IIb VISION-DMD (VBP15-004) study being conducted by ReveraGen) Santhera will fund through a concurrent financing expected to gross $50mm; regulatory and commercialization milestones up to $80mm in the DMD indication; regulatory milestones for three additional indications up to a total of $205mm; four one-time sales milestone payments up to an aggregate $130mm; plus tiered royalties ranging from a single-digit percentage to low-double-digit percentage (Strategic Transactions estimates 1-29%) on annual net sales. Santhera may exercise its option upon receipt of data from the VBP15-004 study and pays a one-time option exercise consideration of $30mm. Initial clinical data suggest vamorolone has the anti-inflammatory efficacy of standard glucocorticoids, with reduced steroid-associated safety concerns. Santhera, focused on rare neuro-ophthalmological, neuromuscular, and pulmonary diseases, is currently investigating its own Raxone (idebenone; already approved in the EU in 2015 for Leber's hereditary optic neuropathy (LHON)) in a Phase II trial in DMD, an indication for which it has been granted orphan drug designation in Europe and the US. Vamorolone, for which Santhera estimates peak sales potential of $500mm in the DMD indication, gives the company a second late-phase DMD candidate.


Update 12/2018

As a result of Santhera's completion of a concurrent financing (which grossed CHF23.5mm ($23.7mm) through the placement of 3.13mm shares at CHF7.50 apiece), the company has successfully completed the option acquisition, securing its exclusive sub-licensing rights to vamorolone. Santhera will use $20mm of the net proceeds to pay the up-front cash portion of this deal.


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Financials


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Overview
Potential Deal Value $480.95mm
Upfront Total $35.95mm
Total Regulatory Milestones $205.00mm
Total Other $30.00mm
Total Milestones (pre-sales) $80.00mm
Total Milestones (sales) $130.00mm
Transactions 1 of 5 (11/2018)
Funding Stage Upfront
Equity Purchased as % 13.3%
Upfront (Cash) $20.00mm
Upfront (Buyers's Equity) $15.95mm
Upfront (Total) $35.95mm
Royalty 1%
Royalty 29%
Transactions 2 of 5
Funding Stage MS Tot. (Pre Sales)
MS Tot. (Pre Sales) (Cash) $80.00mm
MS Tot. (Pre Sales) (Total) $80.00mm
Transactions 3 of 5
Funding Stage MS Regulatory
MS Regulatory (Cash) $205.00mm
MS Regulatory (Total) $205.00mm
Transactions 4 of 5
Funding Stage MS Sales
MS Sales (Cash) $130.00mm
MS Sales (Total) $130.00mm
Transactions 5 of 5
Funding Stage Other
Other (Cash) $30.00mm
Other (Total) $30.00mm

Deal Information


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Deal Industry Biotechnology
Pharmaceuticals
Deal Status Final
Deal Type Alliance
Includes Royalty or Profit Split Information
Intra-Biotech Deal
R+D and Marketing-Licensing
Includes Equity
Latest Phase at Time of Deal Clinical Development
Phase II

Product Information


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Product 1 of 1
Product Type Pharmaceutical
Generic Name Vamorolone
Lab Code VBP15
Mechanism of Action Glucocorticoid agonist
Highest Phase at Time of Deal Clinical Development
Phase II
Product Therapeutic Area(s) of Focus Neurology, Nervous System
Muscular Dystrophy
Licenser Name Idorsia Pharmaceuticals Ltd.
Clinical Developer Santhera Pharmaceuticals AG
Licensee Name Santhera Pharmaceuticals AG
Carveouts for Santhera Pharmaceuticals AG
Territories Licensed Worldwide (All) (Exclusive) (Option)
Territories Excluded Worldwide
Asia
Pacific Rim
Japan
South Korea

Company Information


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Idorsia Pharmaceuticals Ltd. www.idorsia.com | Ticker: IDIA
View Company Profile | View Company Deals
Company Location Worldwide
Europe
Western Europe
Switzerland
Industry Biotechnology
Drug Discovery Tools
Pharmaceuticals
Description Start-Up
Ownership Public
Therapeutic Area(s) of Focus Cancer
Cardiovascular
Immune Disorders
Metabolic Disorders
Neurology, Nervous System
Alias(es) R&D NewCo
Idorsia Ltd.

Santhera Pharmaceuticals AG www.santhera.com | Ticker: SANN
View Company Profile | View Company Deals
Company Location Worldwide
Europe
Western Europe
Switzerland
Industry Biotechnology
Drug Discovery Tools
Pharmaceuticals
Specialty Pharmaceuticals
Ownership Public
Therapeutic Area(s) of Focus Musculoskeletal & Connective Tissue Disorders
Neurology, Nervous System
Respiratory, Pulmonary
Alias(es) Graffinity Pharmaceuticals AG
MyoContract Pharmaceutical Research Ltd.
Graffinity Pharmaceutical Design GMBH
Revenue $21.90mm