Kazia Therapeutics (KZIA): Paxalisib Chinese Rights Licensed

Rhea-AI Summary

Kazia (NASDAQ:KZIA) has secured an agreement with Simcere Pharmaceuticals for the Greater China rights to paxalisib. The deal entails an upfront payment of US$11 million, comprising US$7 million in cash and US$4 million in equity. Additionally, the agreement includes up to US$281 million in milestone payments and mid-teen royalties. This strategic move reduces Kazia's expected financing needs from US$14 million to US$7 million and increases the company's valuation to US$215 million, or US$16.60 per basic ADR.

Positive

• US$11 million upfront payment (US$7 million cash, US$4 million equity investment)
• Potential milestones and royalties totaling up to US$281 million
• Valuation increased to US$215 million or US$16.60 per basic ADR
• Reduced future financing requirements from US$14 million to US$7 million

Negative

• None.

LONDON, UK / ACCESSWIRE / March 30, 2021 / Kazia (NASDAQ:KZIA) has announced it has signed an agreement for the Greater China rights to paxalisib with Simcere Pharmaceuticals. The deal includes an US$11m upfront (US$7m in cash, and US$4m in an equity investment), up to US$281m in milestone payments and royalties in the mid-teens. This is a key development for Kazia because not only does this payment help alleviate the near-term financing needs of the company, but the deal illustrates the potential value of this asset to partners.

We have increased our valuation US$215m or US$16.60 per basic ADR, from US$190 or US$15.02 per basic ADR. This increase is from the Simcere licensing deal (US$11m from upfront payments and US$14.1m from cash flows). This has reduced our expected future financing requirement to US$7m from US$14m previously.

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FAQ

What is the recent agreement Kazia signed regarding paxalisib?

Kazia signed a deal with Simcere Pharmaceuticals for the Greater China rights to paxalisib, including an upfront payment of US$11 million.

How much is Kazia's valuation after the licensing deal?

Kazia's valuation increased to US$215 million or US$16.60 per basic ADR following the licensing deal.

What are the financial implications of the deal for Kazia?

The deal reduces Kazia's expected financing needs from US$14 million to US$7 million.

What are the expected milestone payments from the agreement with Simcere?

The agreement includes up to US$281 million in milestone payments and mid-teen royalties.