Albireo Pharma said its subsidiary Elobix AB has entered into an agreement with HealthCare Royalty Partners to monetize its royalty rights under its license agreement with EA Pharma for elobixibat in the treatment of chronic constipation in Japan.
Elobixibat is a first-in-class product candidate to treat chronic idiopathic constipation, or, chronic constipation in Japan. It is an inhibitor of the ileal bile acid transporter in the terminal ileum to increase secretion and motility in the large bowel without negatively affecting important functions in the small intestine.
“The transaction is designed to provide significant nondilutive capital for Albireo if elobixibat is approved in Japan, allowing us to further strengthen our cash position as we focus on the development of our lead product candidate A4250,” said Ron Cooper, president and CEO of Albireo.
Under the terms of the agreement with HealthCare Royalty Partners, Albireo’s subsidiary Elobix will receive $45 million if elobixibat is approved by the Japanese Ministry of Health, Labour and Welfare. It is eligible to receive an additional $15 million upon achievement of a specified sales milestone. In return, HealthCare Royalty Partners has the right to receive royalties and sales milestones for elobixibat in Japan that may become payable by EA Pharma, up to a specified threshold. If the specified threshold is reached, Elobix will again become eligible to receive royalties and sales milestones for elobixibat under the terms of its license agreement with EA Pharma. Elobix has retained its right to receive a milestone payment from EA Pharma if elobixibat is approved in Japan.
EA Pharma submitted a new drug application for elobixibat to treat chronic constipation in Japan in February 2017, following results from a phase 3 clinical trial in Japan. If approved in Japan, elobixibat would become the first IBAT inhibitor approved anywhere in the world.
January 3, 2018
Photo: Ron Cooper, CEO of Albireo