Zinger Key Points
- Capricor will also receive an upfront payment of $20 million and additional milestone payments of up to $715 million.
- The upfront payment and equity investment will help the company to extend its cash runway into 2026.
Tuesday, Capricor Therapeutics Inc CAPR entered into a binding term sheet with Nippon Shinyaku Co., Ltd., a Japanese pharmaceutical company, for the commercialization and distribution in Europe of Capricor's lead asset, deramiocel, for Duchenne muscular dystrophy (DMD).
DMD is a genetic disorder characterized by progressive weakness and chronic inflammation of the skeletal, heart, and respiratory muscles.
In June, Capricor Therapeutics released three-year results from the ongoing HOPE-2 open-label extension study with CAP-1002 in boys and young men with DMD.
According to the results, patients treated with CAP-1002 continued to show benefits after three years of treatment compared to an external comparator dataset of similar DMD patients.
The company also announced the long-term benefits of deramiocel, showing increased cardiac function based on several different measures.
The potential transaction covered by the term sheet is similar to the existing Commercialization and Distribution Agreements with Nippon Shinyaku in the United States and Japan, with an opportunity for global product reach.
In addition, Nippon Shinyaku has agreed to purchase approximately $15 million of Capricor common stock at a 20% premium to the 60-day VWAP.
Nippon Shinyaku will purchase around 2.79 million common shares at $5.36 per share.
Capricor will be responsible for developing and manufacturing deramiocel for potential approval in the European Union, the U.K., and several other countries in the region.
Nippon Shinyaku will be responsible for the sales and distribution of deramiocel in those territories.
Capricor will also receive an upfront payment of $20 million, additional development and sales-based milestone payments of up to $715 million, and a double-digit share of product revenue.
The potential milestones from the combined agreements now total approximately $1.5 billion.
"With the addition of the upfront payment and equity investment, we will be able to extend our runway into 2026 and be well-positioned to advance toward potential approval of deramiocel in the United States and beyond. Furthermore, these funds will provide necessary capital for commercial launch preparations, manufacturing scale-up, and product development for Europe," said Linda Marbán, Capricor's CEO.
The company plans to start FDA rolling submission in the 2024 third quarter.
Price Action: CAPR stock is trading higher by 6.55% to $4.69 premarket at the last check on Tuesday.
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