Dr Reddy's To Sell Its Anti-Cancer Agent To Citius Pharma

Citius Pharmaceuticals Inc CTXR has agreed to acquire anti-cancer agent E7777 from Dr. Reddy's Laboratories Ltd RDY.
E7777 is an engineered IL-2-diphtheria toxin fusion protein.
In March 2016, Dr. Reddy's had acquired the exclusive global rights, excluding Japan and Asia, from Eisai Co Ltd ESALY.
Dr. Reddy's will receive $40 million upfront on the transaction's closing, followed by a milestone payment of up to $40 million related to the CTCL (cutaneous T-cell lymphoma) indication approval and up to $70 million for additional indication approvals.
Further, the Hyderabad-based drugmaker said it would receive certain sales-based milestones and tiered earn-out payments.
Eisai will receive a $6 million development milestone payment upon initial approval and additional commercial milestone payments.
Eisai will be responsible for completing the current CTCL trial and chemistry, manufacturing, and controls (CMC) activities through the filing of an application for E7777 with the FDA, expected by the end of 2022.
Citius will be responsible for development costs associated with potential additional indications.
As of June 30, 2021, Citius had $115.7million in cash and cash equivalents and plans to fund the upfront payments for the transaction with cash on hand.
Price Action: RDY stock closed at $67.09 on Friday, while CTXR stock is up 2.86% at $2.16 during the premarket session on the last check Tuesday.