Benzinga | Apr 13, 2021 06:33AM EDT

Cerevel Therapeutics Announces $125M Financing Transaction With NovaQuest And Bain Capital To Fund Phase 3 Development Program For Tavapadon In Paskinson's

Cerevel Therapeutics, (NASDAQ:CERE), a company dedicated to unraveling the mysteries of the brain to treat neuroscience diseases, today announced an up to $125 million non-dilutive financing transaction with NovaQuest and Bain Capital to fund the full Phase 3 development program for tavapadon in Parkinson's disease, also known as the TEMPO trials.

"Cerevel continues its track record of innovative deal making with today's announcement, a strategic funding arrangement to support the completion of the full Phase 3 development program for tavapadon in Parkinson's disease," said Tony Coles, chairperson and chief executive officer of Cerevel Therapeutics. "By thoughtfully risk-sharing development costs - working with partners who share our belief in the potential of tavapadon to serve as a backbone therapy for patients with Parkinson's disease - we have secured funding for the entire Phase 3 program through planned NDA submission." Coles continued, "This transaction also gives us flexibility to allocate capital to our most promising earlier stage assets as they advance into the clinic, and our expected cash runway is now extended into 2024."

$125 Million Non-Dilutive Tavapadon Financing

Under the terms of the transaction, NovaQuest and Bain Capital are each expected to pay up to $62.5 million, for a total of up to $125 million, in four installments over four years. In exchange, NovaQuest and Bain Capital will receive payments based on an approval milestone, sales milestones, and royalty payments, the total of which will not exceed 4.25x the full amount paid to Cerevel; Cerevel holds the option to accelerate payment at a reduced cap starting at 3.0x the amount received, under certain conditions. Under the terms of the deal, Cerevel will make milestone and royalty payments upon successful U.S. regulatory approval. NovaQuest and Bain Capital will be entitled to an approval milestone, sales milestones based on cumulative U.S. net sales, and combined mid-single digit to low-double digit royalty payments on annual U.S. net sales. Cerevel will retain meaningful upside potential for tavapadon in the U.S. along with full worldwide commercial rights.

Cerevel is currently dosing patients with early- and late-stage Parkinson's disease in all three of its Phase 3 trials of tavapadon, known as TEMPO-1, TEMPO-2, and TEMPO-3, as well as the open label extension trial, known as TEMPO-4. The four TEMPO trials make up the full Phase 3 program for tavapadon and will serve as the basis for the NDA submission for broad use in patients with Parkinson's disease. Preliminary data readouts from the Phase 3 program are expected to be available beginning in the first half of 2023.

Goodwin Procter LLP acted as legal counsel to Cerevel Therapeutics. Wyrick Robbins Yates & Ponton LLP acted as legal counsel to NovaQuest. Ropes & Gray LLP acted as legal counsel to Bain Capital.