AIT Therapeutics announced that, having previously signed a letter of intent (LOI), a definitive agreement to license the commercial rights for its novel cylinder free ventilator compatible nitric oxide (NO) generator and phasic-flow delivery system (GeNOvent) for use in the hospital setting at NO concentrations < 80 ppm to a commercial partner is close to being finalized.
The partner will be named upon the signing of a definitive agreement and Board approvals from both companies, which is expected to occur within the next 45 days.
AIT chairman and CEO Steve Lisi said: “We are thrilled to announce this agreement at this time. This partnership is a result of the incredible work by the team at AIT, and I am very proud of their efforts. We look forward to working with the highly skilled team of our partner to bring this revolutionary product to market.
“Our partner knows the specialist hospital market well, given its established commercial team.”
AIT grants an exclusive license for the commercialization of the GeNOvent for the treatment of persistent pulmonary hypertension of the newborn (PPHN) and future related indications at concentrations of <80 ppm in the hospital setting in the United States and another country
AIT will receive payments up to $32.5 million in up front and regulatory milestones, of which $31.5 million is associated with the US market
AIT will receive royalties based upon gross profit, which is defined as net sales less only payments to AIT for the cost of the GeNOvent and the related filters. Annual royalties range between 15% and 20% after cumulative gross profit first reaches $50 million (on which a royalty of 5% is payable) and break down as follows:
A 15% royalty on the first $100 million in annual gross profit
A 20% royalty on all annual gross profit above $100 million
The partner shall pay AIT cost plus for generator systems as well as filters
AIT will be responsible for development, manufacturing, regulatory submissions and system repairs
The partner will be responsible for all commercial sales and marketing functions including:
Hiring and managing dedicated field-based teams, including sales representatives, medical and clinical liaisons, etc.
AIT’s cash is expected to fund operations into the second quarter of 2020, exclusive of regulatory milestones
The Company will request the trading of its common stock be moved to the NASDAQ exchange
Allows AIT the ability to increase its infrastructure to support a pivotal bronchiolitis study and a pilot nontuberculous mycobacteria (NTM) study in the U.S., both anticipated to commence prior to year-end 2019
Enhances the Company’s ability to find commercial partners in other key global markets
Managing all operations in support of a commercial launch, including marketing, customer support, technical support, distribution, logistics etc.
“We, along with our partner, anticipate entering the U.S. market in the first half of 2020, provided a timely FDA approval before year-end 2019 in PPHN,” added Mr. Lisi.
“Given the elimination of nitric oxide cylinders and the associated benefits, along with the expertise of our partner, we anticipate our system achieving significant market share in this >$500m market over the first few years after launch.”
Source: Company Press Release