Major Funding Deal: Therapeutics Company Secures $275 Million Through Drug Royalty Agreement

A therapeutics company has announced a funding agreement worth $275 million with a financial fund specializing in pharmaceutical royalties. The company’s stock gained 5.84% following the news.

The deal is centered on the future net sales of tividenofusp alfa, the company’s lead drug candidate. This is an investigational TransportVehicle-enabled enzyme replacement therapy designed to cross the blood-brain barrier to treat mucopolysaccharidosis type II (MPS II), commonly known as Hunter syndrome.

Transaction Details and Payment Conditions

The funding agreement is contingent upon various closing conditions, including the accelerated approval of tividenofusp alfa by the U.S. Food and Drug Administration (FDA).

• Initial Payment: The financial fund will make an initial payment of $200 million upon the transaction closing (pending FDA accelerated approval).

• Additional Payment: The fund is required to make an additional payment of $75 million if the therapeutics company obtains European Medicines Agency (EMA) approval for tividenofusp alfa by December 31, 2029.

In exchange for these payments, the financial fund will receive a 9.25% royalty on the worldwide net sales of tividenofusp alfa from the therapeutics company. Royalty payments will cease upon reaching a multiple of 3.0x, or 2.5x if achieved by the first quarter of 2039.

Regulatory Status of Hunter Syndrome Drug

The Biologics License Application (BLA) seeking accelerated approval for tividenofusp alfa is currently under FDA review. However, the target action date was extended from January 5 to April 5, 2026. This extension followed the company’s submission of updated clinical pharmacology information in response to an FDA request. The company stated that the submission was unrelated to efficacy, safety, or biomarkers.

The FDA classified the submission as a major amendment to the BLA, leading to the extension of the target action date. Nevertheless, the regulatory body did not request any additional trial data.

Tividenofusp alfa had previously been granted key FDA designations, including Breakthrough Therapy, Fast Track, Orphan Drug, and Rare Pediatric Disease. If approved, it may become the first Hunter syndrome therapy designed to address both the cognitive and physical manifestations of the disorder.

Other Pipeline Candidates

The therapeutics company is also developing other drug candidates through collaborations with major partners:

• Frontotemporal Dementia (FTD-GRN): In collaboration with Takeda to develop DNL593. A Phase I/II study is ongoing.

• Parkinson’s Disease (PD): Continues co-development of BIIB122 with Biogen. The Phase IIb LUMA study is fully enrolled, with a readout expected in 2026. Additionally, the company is conducting the Phase IIa BEACON study, which specifically enrolls participants with LRRK2-associated PD to assess LRRK2 inhibition.

Source: https://finance.yahoo.com/news/denali-enters-275m-funding-deal-145600216.html