Royalty Pharma Buys 4.5 Percent Royalty
on Worldwide Sales for $90 Million Plus $10
Million Equity in Cytokinetics
Cytokinetics, Inc. (Nasdaq:CYTK) and Royalty Pharma today announced
that Cytokinetics has agreed to sell to Royalty Pharma a portion of
the potential royalty due to Cytokinetics from Amgen on worldwide
sales of omecamtiv mecarbil. Cytokinetics has also agreed to
exercise its option to co-invest with Amgen in the Phase 3
development program of omecamtiv mecarbil in exchange for increased
royalties from Amgen on worldwide sales of omecamtiv mecarbil
outside Japan and co-promotion rights.
Cytokinetics sold to Royalty Pharma a 4.5
percent royalty on potential worldwide sales of omecamtiv mecarbil
for $90 million in an upfront cash payment. The royalty rate
purchased may increase up to an additional 1 percent under certain
circumstances. In addition, Royalty Pharma has agreed to purchase
$10 million of Cytokinetics’ common stock.
Cytokinetics has also agreed with Royalty Pharma
to exercise its option to co-invest $40 million in the Phase 3
development program of omecamtiv mecarbil under its collaboration
with Amgen. As a result, Cytokinetics is eligible to receive an
incremental royalty of up to 4 percent on increasing worldwide
sales of omecamtiv mecarbil outside of Japan. Following the
transaction with Royalty Pharma, Cytokinetics retains the right to
receive more than $600 million in potential milestone payments as
well as escalating double-digit royalties that may exceed 20
percent on tiered worldwide sales of omecamtiv mecarbil outside
Japan, with a lower royalty rate in Japan under the Amgen
Agreement.
Exercising its option and co-funding will afford
Cytokinetics the right to co-promote omecamtiv mecarbil in
institutional care settings in North America, with reimbursement by
Amgen for certain sales force activities. A joint commercial
operating team comprising representatives of Cytokinetics and Amgen
will then be responsible for the commercialization program of
omecamtiv mecarbil.
“These key corporate developments underscore our
steadfast commitment to the promise of omecamtiv mecarbil for the
potential treatment of patients with heart failure and the prudent
advancement of our strategy towards commercialization,” said Robert
I. Blum, Cytokinetics’ President and Chief Executive Officer. “We
are pleased to align with Royalty Pharma on our shared vision of
the significant value of omecamtiv mecarbil and how we may realize
that upside under our collaboration agreement with Amgen.”
“We are pleased to be partnering with
Cytokinetics on this important new approach to heart failure, which
remains a significant unmet medical need,” said Pablo Legorreta,
Royalty Pharma’s Chief Executive Officer. “The science behind
omecamtiv mecarbil is highly novel and represents a potential
paradigm shift in the management of heart failure.”
Centerview Partners LLC acted as financial
advisor to Cytokinetics on the transaction. Cooley LLP and Morrison
& Foerster acted as legal advisors to Cytokinetics on the
transaction. Goodwin, Wolf Greenfield, and Maiwald acted as legal
advisors to Royalty Pharma on the transaction.
Conference Call and Webcast Information
Members of Cytokinetics’ senior management team
will host a conference call and webcast today at 8:30 AM Eastern
Time. The webcast can be accessed through the Investors & Media
section of the Cytokinetics website at www.cytokinetics.com. The
live audio of the conference call can also be accessed by telephone
by dialing either (866) 999-CYTK (2985) (United States and Canada)
or (706) 679-3078 (international) and typing in the passcode
61858456.
An archived replay of the webcast will be
available via Cytokinetics’ website until February 9, 2017.
The replay will also be available via telephone by dialing (855)
859-2056 (United States and Canada) or (404) 537-3406
(international) and typing in the passcode 61858456 from February
2, 2017 at 11:30 AM Eastern Time until February 9, 2017.
About Omecamtiv Mecarbil and Amgen
Collaboration
Omecamtiv mecarbil is a novel cardiac myosin
activator. Cardiac myosin is the cytoskeletal motor protein in the
cardiac muscle cell that is directly responsible for converting
chemical energy into the mechanical force resulting in cardiac
contraction. Cardiac myosin activators are thought to accelerate
the rate-limiting step of the myosin enzymatic cycle and shift the
enzymatic cycle in favor of the force-producing state. Preclinical
research has shown that cardiac myosin activators increase
contractility in the absence of changes in intracellular calcium in
cardiac myocytes.
In 2006, Amgen and Cytokinetics entered into a
strategic alliance to discover, develop, and commercialize novel
small molecule therapeutics designed to activate cardiac muscle for
the potential treatment of heart failure. Initially, following
Amgen’s option exercise in 2009, the collaboration was worldwide,
excluding Japan. The companies expanded the collaboration in 2013
to provide Amgen with worldwide rights to develop and commercialize
omecamtiv mecarbil and related compounds subject to development and
commercial participation rights of Cytokinetics. Omecamtiv mecarbil
is being developed by Amgen in collaboration with Cytokinetics.
Amgen holds an exclusive, worldwide license to omecamtiv mecarbil
and related compounds, subject to Cytokinetics’ specified
development and commercialization rights. Amgen has also entered an
alliance with Servier for exclusive commercialization rights in
Europe as well as the Commonwealth of Independent States, including
Russia. Servier contributes funding for development and provides
strategic support to the program.
Last month, Cytokinetics announced the start of
GALACTIC-HF (Global Approach to Lowering Adverse Cardiac Outcomes
Through Improving Contractility in Heart Failure), the Phase 3
cardiovascular outcomes trial of omecamtiv mecarbil which is being
conducted by Amgen, in collaboration with Cytokinetics.
About Royalty Pharma
Founded in 1996, Royalty Pharma is the industry
leader in acquiring revenue-producing intellectual property, with
over $15 billion in royalty assets. Royalty Pharma funds
innovation in life sciences both directly and indirectly: directly
when it partners with life sciences companies to co-develop and
co-fund products in late-stage clinical trials, and indirectly when
it acquires existing royalty interests from the original innovators
(academic institutions, research hospitals, foundations and
inventors). The company’s portfolio includes royalty
interests in over 40 approved products including AbbVie’s Humira,
AbbVie and J&J’s Imbruvica, Biogen’s Tecfidera, Vertex’s
Kalydeco and Orkambi, J&J’s Remicade, Merck’s Januvia, Gilead’s
Atripla and Truvada, Pfizer’s Lyrica, and Astellas and Pfizer’s
Xtandi. Royalty Pharma is also the preferred partner for
pre-approval royalty purchases, having committed over $850 million
to direct R&D funding and having invested over $4 billion in
royalties on Phase 3 products since 2011.
About Cytokinetics
Cytokinetics is a late-stage biopharmaceutical
company focused on discovering, developing and commercializing
first-in-class muscle activators as potential treatments for
debilitating diseases in which muscle performance is compromised
and/or declining. As a leader in muscle biology and the mechanics
of muscle performance, the company is developing small molecule
drug candidates specifically engineered to increase muscle function
and contractility. Cytokinetics’ lead drug candidate is tirasemtiv,
a fast skeletal muscle troponin activator. Tirasemtiv is the
subject of VITALITY-ALS, an international Phase 3 clinical trial in
patients with ALS. Tirasemtiv has been granted orphan drug
designation and fast track status by the U.S. Food and Drug
Administration and orphan medicinal product designation by the
European Medicines Agency. Cytokinetics is preparing for the
potential commercialization of tirasemtiv in North America and
Europe and has granted an option to Astellas Pharma Inc. for
development and commercialization in other countries. Cytokinetics
is collaborating with Astellas to develop CK-2127107, a
next-generation fast skeletal muscle activator. CK-21271017 is the
subject of two ongoing Phase 2 clinical trials enrolling patients
with spinal muscular atrophy and chronic obstructive pulmonary
disease. Cytokinetics is collaborating with Amgen Inc. to develop
omecamtiv mecarbil, a novel cardiac muscle activator.
Omecamtiv mecarbil is the subject of GALACTIC-HF, an international
Phase 3 clinical trial in patients with heart failure. Amgen holds
an exclusive worldwide license to develop and commercialize
omecamtiv mecarbil with a sublicense held by Servier for
commercialization in Europe and certain other countries; Astellas
holds an exclusive worldwide license to develop and commercialize
CK-2127107. Licenses held by Amgen and Astellas are subject
to Cytokinetics' specified co-development and co-commercialization
participation rights. For additional information about
Cytokinetics, visit http://www.cytokinetics.com/.
Forward-Looking Statements
This press release contains forward-looking
statements for purposes of the Private Securities Litigation Reform
Act of 1995 (the “Act”). Cytokinetics disclaims any intent or
obligation to update these forward-looking statements, and claims
the protection of the Act’s Safe Harbor for forward-looking
statements. Examples of such statements include, but are not
limited to, statements relating to Cytokinetics’ and its partners’
research and development activities, including the design, results,
significance and utility of GALACTIC-HF clinical trial results and
the potential for success and timing for the progression of
omecamtiv mecarbil; and the properties and potential benefits of
Cytokinetics' drug candidates; and Cytokinetics’ receipt of
milestone and royalty payments from Amgen, including the timing of
such payments; and the applicable royalty rate amounts on omecamtiv
mecarbil that may be payable to Royalty Pharma;. Such statements
are based on management's current expectations, but actual results
may differ materially due to various risks and uncertainties,
including, but not limited to Amgen's decisions with respect to the
design, initiation, conduct, timing and continuation of development
activities for omecamtiv mecarbil; potential difficulties or delays
in the development, testing, regulatory approvals for trial
commencement, progression or product sale or manufacturing, or
production of Cytokinetics' drug candidates that could slow or
prevent clinical development or product approval, including risks
that patient enrollment for or conduct of clinical trials may be
difficult or delayed, Cytokinetics' drug candidates may have
adverse side effects or inadequate therapeutic efficacy, the U.S.
Food and Drug Administration or foreign regulatory agencies may
delay or limit Cytokinetics' or its partners' ability to conduct
clinical trials, and Cytokinetics may be unable to obtain or
maintain patent or trade secret protection for its intellectual
property; Cytokinetics may incur unanticipated research and
development and other costs or be unable to obtain additional
financing necessary to conduct development of its products;
standards of care may change, rendering Cytokinetics' drug
candidates obsolete; and competitive products or alternative
therapies may be developed by others for the treatment of
indications Cytokinetics' drug candidates and potential drug
candidates may target. For further information regarding these and
other risks related to Cytokinetics' business, investors should
consult Cytokinetics' filings with the Securities and Exchange
Commission. Forward-looking statements are not guarantees of future
performance, and Cytokinetics' actual results of operations,
financial condition and liquidity, and the development of the
industry in which it operates, may differ materially from the
forward-looking statements contained in this press release. Any
forward-looking statements that Cytokinetics makes in this press
release speak only as of the date of this press release.
Cytokinetics assumes no obligation to update its forward-looking
statements whether as a result of new information, future events or
otherwise, after the date of this press release.
Contact:
Cytokinetics
Diane Weiser
Vice President, Corporate Communications, Investor Relations
(415) 290-7757
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