Race Oncology pens key deal to seek chemo drug Bisantrene licensing
Race Oncology (ASX:RAC) Limited has today entered into an agreement with transaction consultancy business, Biosynergy Partners LLC, to pursue licensing and other deals for chemotherapy drug, Bisantrene.
Bisantrene is a cancer drug that was first discovered several decades ago by US pharma giant, Lederle Pharmaceuticals, and is related to the most widely used class of cancer chemotherapy drugs called 'anthracyclines'. Bisantrene has delivered impressive trial results in the treatment of several cancers including breast cancer, ovarian cancer, lymphoma and acute myeloid leukaemia (AML).
Under the agreement, potential transactions include any sale, license, partnership, collaborative venture or other arrangement, whereby an interest in Bisantrene is transferred to a third party.
Biosynergy owner, Dr Cullity — also a non-executive director of RAC — will work with Race to prepare licensing presentations and due diligence materials for prospective partners, identify and engage with potential partners, and seek to structure, negotiate and close transactions.
“We are particularly interested in exploring licensing deals, where the partner carries the cost of the proposed AML registration trial,” said Race CEO, Peter Molloy.
“We would also like to see upfront license fees paid that would represent non-dilutive funding for Race.”
Dr Cullity said Biosynergy is looking forward to working with Race to bring the bisantrene value proposition before global oncology companies.
“Our clear objective will be to drive Race shareholder value," he added.
The company noted that there is no guarantee that the agreement will lead to an acceptable licensing or other deal.
No retainer will be paid by Race to Biosynergy — however, Biosynergy will receive transaction fees, including 6% of the total consideration up to US$25 million and 3% of the total consideration over $US25 million.
In this case, 'total consideration' refers to the total proceeds and all other payments to RAC, including sale value, upfront license fees, milestone payments, R&D funding, royalties and any other consideration received in the transaction.
The agreement provides for a minimum transaction fee equivalent to 10% of the first US$6 million in total consideration and a maximum transaction fee of US$5 million, the latter equivalent to total consideration of US$142 million.
For further agreement details, you can find the announcement here.
RAC has been on an upward trajectory since Monday, and on the back of today's news surged to intra-day highs of 133% — currently at $0.23. This resulted into a "please explain" speeding ticket from the ASX this afternoon.
More about Race Oncology
The $9.7 million capped RAC is attempting to repurpose the chemotherapy drug, Bisantrene, along with other late-stage drug assets that have been overlooked by big pharma. Bisantrene offers a treatment for relapsed and refractory AML (r/r AML) and was the subject of more than 40 phase II clinical studies before it was lost in a series of pharmaceutical mergers during the 1990s.
In the US, Race owns two granted patents on Bisantrene and has secured Orphan Drug designation and Rare Paediatric Disease designation. Its goal is to complete clinical development and gain approval by the US FDA.