Benzinga | Jan 7, 2022 01:03PM EST

Cytokinetics, Royalty Pharma Report Funding Deals For Total Of Up To $450M

Royalty Pharma Extends Capital to Cytokinetics to Support the Commercial Launch of Omecamtiv Mecarbil and the Further Development of Aficamten

Royalty Pharma Purchases Royalties on Future Sales of Aficamten

Cytokinetics to Host Conference Call and Webcast Today at 8:30 am Eastern Time

SOUTH SAN FRANCISCO, Calif. and NEW YORK, Jan. 07, 2022 (GLOBE NEWSWIRE) -- Cytokinetics, Incorporated (NASDAQ:CYTK) and Royalty Pharma plc (NASDAQ:RPRX) today announced that Cytokinetics has secured long-term capital from Royalty Pharma to support the potential commercialization of omecamtiv mecarbil and the further development of aficamten. In addition, Cytokinetics sold to Royalty Pharma royalties on future worldwide sales of aficamten.

Omecamtiv mecarbil is an investigational, selective, small molecule cardiac myosin activator, that was granted Fast Track Designation by the U.S. Food and Drug Administration (FDA) and was the subject of GALACTIC-HF, a positive Phase 3 clinical trial in patients with heart failure with reduced ejection fraction. Aficamten is an investigational selective, small molecule cardiac myosin inhibitor that is under investigation for hypertrophic cardiomyopathy and was granted Breakthrough Therapy Designation by the U.S. FDA.

"These corporate development transactions continue our history of monetizing our leadership in muscle biology through creative deal making and provide further optionality, capital efficiencies and financial resources to expand our cardiovascular development and commercialization programs," said Robert I. Blum, Cytokinetics' President and Chief Executive Officer. "We are pleased to enter into these additional transactions with Royalty Pharma, underscoring our shared commitment to build an industry leading cardiovascular franchise in cardiac myosin modulation."

"We are pleased to expand our partnership with Cytokinetics," said Pablo Legorreta, Royalty Pharma's Founder and Chief Executive Officer. "Royalty Pharma is excited to support the company at this important stage of transformation towards a commercial organization with an exciting late stage pipeline addressing unmet medical needs in multiple cardiovascular diseases."

Royalty Pharma will provide Cytokinetics long-term capital of up to $300 million to support the potential commercialization of omecamtiv mecarbil and the further development of aficamten, and other general corporate purposes. The capital is available in five tranches, including an initial tranche of $50 million upon closing and four additional tranches in the aggregate amount of $250 million upon the occurrence of certain regulatory and clinical development milestones related to omecamtiv mecarbil and aficamten. Each tranche has an interest-free and payment-free period of six calendar quarters, followed by 34 calendar quarters of installment re-payments totaling 1.9 times the amount drawn.

In addition, Royalty Pharma has purchased from Cytokinetics a royalty on aficamten of 4.5% on sales up to $1 billion and 3.5% on sales above $1 billion, subject to certain potential step-downs, in exchange for payments of up to $150 million, comprised of $50 million at closing and two additional $50 million payments, conditional upon the initiation of potential pivotal clinical trials for oHCM and nHCM, respectively.

From these transactions, Cytokinetics anticipates receipt of up to $150 million in near-term funding. Together with its proforma cash at the end of 2021 which was bolstered by transactions executed by Cytokinetics last year, this funding from Royalty Pharma enables Cytokinetics to have at least two years of cash runway based on expected 2022 expenditures, inclusive of planned commercialization activities and expanded pipeline development programs.

Cooley LLP and Morrison Foerster acted as legal advisors to Cytokinetics on the transactions. Goodwin Procter, Fenwick & West LLP, Dechert and Maiwald acted as legal advisors to Royalty Pharma.

Conference Call and Webcast Information