Concert Pharmaceuticals Announces Sale of VX-561 Milestones to Vertex for $32 Million

Rhea-AI Summary

Concert Pharmaceuticals (NASDAQ: CNCE) announced the sale of potential future milestones relating to VX-561 to Vertex Pharmaceuticals for $32 million. This transaction enhances Concert's balance sheet as it progresses its lead asset, CTP-543, through Phase 3 trials for alopecia areata. With these proceeds, the company expects its financial resources to extend into Q2 2022. Vertex now holds worldwide rights to VX-561, previously acquired under a 2017 agreement, which included an initial $160 million payment and potential for $90 million in milestones; no further obligations remain.

Positive

• Secured $32 million in non-dilutive capital from Vertex Pharmaceuticals.
• Strengthened balance sheet to fund CTP-543 into Q2 2022.
• No further milestone obligations to Vertex, streamlining future financial commitments.

Negative

• None.

Concert Pharmaceuticals, Inc. (NASDAQ: CNCE) today announced that Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) has purchased the potential future milestones under the companies’ 2017 asset purchase agreement relating to VX-561 (deutivacaftor) for $32 million.

“This transaction provided an opportunity to secure non-dilutive capital and strengthens our balance sheet as we continue to advance CTP-543, our lead asset for alopecia areata, through its Phase 3 program,” stated Roger Tung, Ph.D., President and Chief Executive Officer of Concert Pharmaceuticals. “By receiving these proceeds, we now expect our cash, cash equivalents and investments to fund the Company into the second quarter of 2022.”

Under the asset purchase agreement, Vertex acquired worldwide development and commercialization rights to VX-561 (formerly known as CTP-656) and other assets related to the treatment of cystic fibrosis. VX-561 is an investigational cystic fibrosis transmembrane conductance regulator (CFTR) potentiator that has the potential to be used as part of future once-daily combination regimens of CFTR modulators that treat the underlying cause of cystic fibrosis. In 2017, Concert received a one-time cash payment of $160 million upon closing the asset purchase, with the potential for $90 million in future milestones. Following receipt of the $32 million, no further milestone obligations remain.

Chestnut Securities, Inc. acted as exclusive financial advisor to Concert in this transaction.

About Concert

Concert Pharmaceuticals is a clinical stage biopharmaceutical company that is developing small molecule drugs that it discovered through the application of its DCE Platform^® (deuterated chemical entity platform). Selective incorporation of deuterium into known molecules has the potential, on a case-by-case basis, to provide better pharmacokinetic or metabolic properties, thereby enhancing their clinical safety, tolerability or efficacy. Concert’s lead product candidate is in late-stage development for the treatment of alopecia areata, a serious autoimmune dermatological condition. Concert is also assessing a number of earlier-stage pipeline candidates. For more information please visit www.concertpharma.com or follow us on Twitter at @ConcertPharma or on LinkedIn.

Cautionary Note on Forward Looking Statements

Any statements in this press release about our future expectations, plans and prospects, including, among others, statements about our expectations regarding the sufficiency of our cash, cash equivalents and investments to fund our operations, and any other statements containing the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: the uncertainties inherent in the initiation, timing and design of future clinical trials, the availability and timing of data from ongoing and future clinical trials and the results of such trials, whether preliminar

FAQ

What milestone payment did Concert Pharmaceuticals receive from Vertex Pharmaceuticals?

Concert Pharmaceuticals received $32 million from Vertex Pharmaceuticals for potential future milestones relating to VX-561.

How will the funding affect Concert Pharmaceuticals' financial position?

The $32 million funding is expected to provide non-dilutive capital and strengthen the balance sheet, allowing the company to operate into Q2 2022.

What does the agreement with Vertex Pharmaceuticals entail?

Vertex Pharmaceuticals acquired worldwide rights to VX-561 and other assets related to cystic fibrosis under a previous 2017 agreement.

What is the purpose of CTP-543 in Concert Pharmaceuticals' development pipeline?

CTP-543 is Concert Pharmaceuticals' lead asset currently in Phase 3 trials for treating alopecia areata.

What was the initial payment Concert received under the 2017 asset purchase agreement?

Concert Pharmaceuticals received an initial payment of $160 million upon closing the 2017 asset purchase agreement with Vertex.