Transaction Information
Athenex, Inc. (NASDAQ: ATNX, "Athenex", or "the Company) is a global biopharmaceutical company focused on novel therapies for cancer and related conditions. At the beginning of 2022, Athenex began to take steps to extend the Company's cash runway, fund development of its cell therapy business, and de-lever, while avoiding highly-dilutive equity financing during a biopharma bear market.
Athenex received FDA approval for its first proprietary asset in 2021: Klisyri, a topical ointment indicated for the treatment of Actinic Keratosis. Athenex had out-licensed Klisyri to Almirall, a global leader in dermatology, and was entitled to receive ongoing royalty and milestone payments from Almirall. Because the equity markets had historically been unresponsive to even the most positive clinical, regulatory, and commercial developments with respect to Klisyri, it was clear that the potential royalty stream from Almirall was a "hidden asset" - not valued by the equity markets - that could be monetized for Athenex shareholders.
Under the terms of the agreement, Athenex will receive $85 million in cash at closing from affiliates of Oaktree Capital Management and Sagard Healthcare Royalty Partners ("the Investors"). The Investors will receive royalty and milestone payments from Almirall on net sales of Klisyri. Importantly, Athenex retained upside from strong product performance in the form of a 50% participation in both royalty payments over a certain annual sales level, as well as various regulatory- and sales-related milestone payments. The transaction value for this transaction was greater than 140% of Athenex's market capitalization at transaction close, supporting that the asset was undervalued by the market.
Approximately $80 million of the proceeds from the transaction will be used toward partially paying down existing debt and operating the business, with $5 million to be placed into escrow and paid to Athenex upon the satisfaction of certain conditions. The transaction is subject to customary closing conditions.
Ladenburg Thalmann & Co. Inc. served as financial advisor and placement agent to Athenex.
About Athenex, Inc.
Founded in 2003, Athenex, Inc. is a global clinical-stage biopharmaceutical company dedicated to becoming a leader in the discovery, development, and commercialization of next generation cell therapy drugs for the treatment of cancer. In pursuit of this mission, Athenex leverages years of experience in research and development, clinical trials, regulatory standards, and manufacturing. The Company's current clinical pipeline is derived mainly from the following core technologies: (1) Cell therapy based on NKT cells (2) Orascovery, based on a P-glycoprotein inhibitor, and (3) Src Kinase Inhibition. Athenex's employees worldwide are dedicated to improving the lives of cancer patients by creating more active, accessible and tolerable treatments. For more information, please visit www.athenex.com.
The information and material presented is provided for informational purposes only and are not to be used or considered as an offer or the solicitation of an offer to sell or buy any securities mentioned herein.