Ceapro Inc V.CZO

RE:RE:RE:Diagnostic test

[prophetoffactz]

"Hard to evaluation but on like like basis it could be
1. upfront circa 30 m
2. targets - sales targets on that deal were not reached si the 179 probably was 0
3.royalties say 15 % - sales 3 annually - say 1 m royalties"

The deal with Strongbridge for AEZS's diagnostic test was six years ago. The test can now be licensed with clinical trial risk, risk of trial delay for the tests most important market(children) eliminated. The significant costs of the prediatric trial could also be turned into an upfront payment. AEZS was also to receive US$5 million upon pediatric approval.

Assuming the US$24 million upfront payment to AEZS stands, as well as the US$5 million for pediatric approval, and adding an assumed ~US$10 million for the pediatric clinical trial costs that have now been incurred that is about $51.5 million potentially upfront all else equal. One could further adjust this upward given inflation, the time value of money since the deal was signed 6 years ago, and given that the risk of pediatric trials and risks of further delay may now be behind the test with approval potentially this year. The childhood trial was to be fully enrolled in December. There could also be significant additional near-term funding given the previous milestones tied to revenue as stated below; US$14 million of which appears potentially achievable near term.

Should CZO/AEZS sell the diagnostic it could also monitize the future royalty stream from the test. Selling the asset outright could add substantial capital without issuing shares and warrants to help drive PGX, etc. AEZS also has C$113 million in tax loss carryforwards and other pipeline assets that could be licensed as they reach human testing.

• US$4,000,000 on achieving US$25,000,000 annual net sales,
• US$10,000,000 on achieving US$50,000,000 annual net sales,
• US$20,000,000 on achieving US$100,000,000 annual net sales,
• US$40,000,000 on achieving US$200,000,000 annual net sales, and
• US$100,000,000 on achieving US$500,000,000 annual net sales.

 

• A wholly-owned subsidiary of Strongbridge Biopharma plc has snapped up the North American rights to Aeterna Zentaris Inc.‘s lead product, Macrilen. 
• Aeterna Zentaris will get a much needed $24 million upfront, and royalties for the patent life of the drug, at a rate of 15% for sales up to $75 million and 18% above $75 million. After patent expiry, royalties will drop to 5%.
• Strongbridge will also pay milestone payments of up to $179 million on sales targets and on a pediatric U.S. approval, and will fund 70% of pediatric development costs.
• Post-review, Aeterna Zentaris strikes commercialization deal | BioPharma Dive