Novelion Therapeutics Inc (NASDAQ:NVLN) closed Tuesday’s trading session at $1.23 almost a week after announcing that it struck a licensing deal for JUXTAPID in Japan.
The company recently revealed that it struck the exclusive licensing agreement in Japan through its subsidiary Aegerion Pharmaceuticals, Inc. The agreement with Recordati Rare Diseases Inc. will facilitate JUXTAPID’s commercialization as a treatment for homozygous familial hypercholesterolemia (HoFH). Aegerion will provide the exclusive first negotiation rights in Japan for any upcoming indications made by Aegerion. The agreement will offer significant benefits to both companies.
“We believe Japan is an important market for JUXTAPID with meaningful potential for growth,” stated Novelion CEO, Ben Harshbarger.
Harshbarger also added that JUXTAPID’s new licensing agreement in Japan is a noteworthy step in the right direction as the firm works on reducing its operating expenses. Novelion is also working on improving its near-term liquidity and steering its resources and goals towards its capital restructuring efforts. Its goal is to steer the company towards achieving sustainable profits by running its activities more efficiently.
Novelion to pay various amounts to Recordati including milestone payments and royalties
Novelion will pay $25 million as an upfront amount to Aegerion as part of the agreement terms. It will also pay an extra $5 million once JUXTAPID’s marketing authorization is transferred to Recordati in Japan. There will also be an extra $80 million milestone payments that Aegerion will receive in installments as from the end of Q1. This particular amount will be paid out once the net sales in Japan hit the $70 million and once the cumulative sales hit $70 million. The milestone payments will continue until Japan’s net sales for JUXTAPID hit the $700 million milestones.
Novelion also plans to include a royalty payment to Aegerion which will be paid out in each quarter. The royalty rate will be 22.5% of JUXTAPID’s net sales in Japan. Novelion plans to include additional details of the agreement in a Form 8-K which it will file with the U.S Securities and Exchange Commission (SEC). The filed form 8-K will then be accessible to the general public through Novelion’s website.