That is not the terms of the deal and yes the asset was aquired very cheaply.
These are the terms
- US$500,000 upon exercising of the option to acquire all rights, title, and interest in the galidesivir program.
- US$500,000 upon completion of Phase 2 clinical trial.
- US$1M upon approval of New Drug Application in US or equivalent or US$1.5M upon Animal Rule approval in which no Phase 2 is required.
- Tiered royalties of 5-10% of Net Sales
- 25% of proceeds from sale of any Priority Review Voucher awarded due to FDA approval of the acquired program
Basically ILA have to pay $500k for the rights and $1.5m if the drug is approved. They get to keep 75% of any PRV sale and only have to share 5-10% royalties.
The real value here is all the human trials are complete and only an animal trial needs to be run to gain FDA approval of the drug (FDA animal rule). Galidisivir will not be a large seller to patients (hopefully), but it is exactly the sort of drug that the US and other militaries stockpile. The military is the best customer as you don't need a salesforce and they buy a huge amount in one transaction upfront.
Where this all leads is it provides the cash required to fund ISLA-101 all the way through to market without us all being diluted to oblivion in the process.
ILA Price at posting:
10.0¢ Sentiment: Buy Disclosure: Held
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