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PTC Therapeutics Signs Evrysdi Royalty Agreement with Royalty Pharma for Up To $1.5 Billion

October 20, 2023

PTC Therapeutics Signs Evrysdi Royalty Agreement with Royalty Pharma for Up To $1.5 Billion

Rare Daily Staff

PTC Therapeutics signed an agreement with Royalty Pharma to monetize up to $1.5 billion of the Evrysdi royalty stream.

Under the agreement, Royalty Pharma acquires additional royalties on Evrysdi for $1.0 billion upfront. The agreement includes options for PTC to sell up to all of its retained royalties on Evrysdi for up to $500 million or for Royalty Pharma to acquire half of such retained royalties for up to $250 million at a later date. PTC maintains all economics associated with up to $250 million in remaining commercial sales milestones associated with Evrysdi global net sales.

This agreement builds on the previous strategic partnership established with Royalty Pharma in 2020. The initial agreement was for the monetization of approximately 43 percent of the Evrysdi royalty stream for $650 million. As a result of the current agreement, PTC will maintain ownership of approximately 19 percent of the Evrysdi royalty stream pending any exercise of future options by PTC or Royalty Pharma.

The proceeds from the financing will be used to retire all outstanding debt obligations with Blackstone Life Sciences and to fund planned operations.

“This non-dilutive financing provides PTC with the capital to support operations and allows for increased operational and financial flexibility by removing the Blackstone debt obligation from our balance sheet,” said Matthew Klein, CEO of PTC Therapeutics. “In addition, the deal structure provides important flexibility for additional non-dilutive capital over the next two years.”

Evrysdi is a survival motor neuron 2 (SMN2) splicing modifier designed to treat spinal muscular dystrophy (SMA) caused by mutations in chromosome 5q that lead to survival motor neuron (SMN) protein deficiency. Evrysdi is administered daily at home in liquid form and non-invasively by mouth or by feeding tube.

Evrysdi is designed to treat SMA by increasing and sustaining the production of SMN protein in the central nervous system (CNS) and peripheral tissues. SMN protein is found throughout the body and is critical for maintaining healthy motor neurons and core motor functions such as swallowing, speaking, and breathing. Evrysdi is currently approved in more than 100 countries. The Evrysdi SMA program is a collaboration between PTC, the SMA Foundation, and Roche.

Under the agreement, PTC has agreed to sell approximately 67 percent of both the outstanding 57 percent of the Evrysdi royalties and the outstanding royalty over the existing cap from the previous royalty financing agreement with Royalty Pharma.

Additionally, until December 31, 2025, PTC will have the option to sell the remainder of the Evrysdi royalty to Royalty Pharma for $500 million in five $100 million tranches, less royalties received. If fewer than three of these options are exercised, Royalty Pharma has the option to purchase 50 percent of the remaining PTC royalty for $250 million less royalties received until March 31, 2026.

Photo: Matthew Klein, CEO of PTC Therapeutics


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