Royalty Pharma and Cytokinetics Announce Funding Agreements Totaling up to $450 Million
Royalty Pharma Extends Capitalto Cytokineticsto Support the Commercial Launch of Omecamtiv Mecarbil and the Further Developmentof Aficamten
- Royalty Pharma Purchases Royalties on Future Sales of Aficamten
Cytokineticsto Host Conference Call and Webcast Today at 8:30 a.m. ET
NEW YORK, NY and SOUTH SAN FRANCISCO, CA, January 7, 2022 – Royalty Pharma plc (Nasdaq: RPRX) and Cytokinetics, Incorporated (Nasdaq: CYTK) today announced that Cytokinetics has secured long-term capital from Royalty Pharma to support the potential commercialization of omecamtiv mecarbil and the further development of aficamten. In addition, Cytokinetics sold to Royalty Pharma royalties on future worldwide sales of aficamten.
Omecamtiv mecarbil is an investigational, selective, small molecule cardiac myosin activator, that was granted Fast Track Designation by the U.S. Food and Drug Administration (FDA) and was the subject of GALACTIC-HF, a positive Phase 3 clinical trial in patients with heart failure with reduced ejection fraction. Aficamten is an investigational selective, small molecule cardiac myosin inhibitor that is under investigation for hypertrophic cardiomyopathy and was granted Breakthrough Therapy Designation by the U.S. FDA.
“These corporate development transactions continue our history of monetizing our leadership in muscle biology through creative deal making and provide further optionality, capital efficiencies and financial resources to expand our cardiovascular development and commercialization programs,” said Robert I. Blum, Cytokinetics’ President and Chief Executive Officer. “We are pleased to enter into these additional transactions with Royalty Pharma, underscoring our shared commitment to build an industry leading cardiovascular franchise in cardiac myosin modulation.”
“We are pleased to expand our partnership with Cytokinetics,” said Pablo Legorreta, Royalty Pharma’s Founder and Chief Executive Officer. “Royalty Pharma is excited to support the company at this important stage of transformation towards a commercial organization with an exciting late stage pipeline addressing unmet medical needs in multiple cardiovascular diseases.”
Royalty Pharma will provide Cytokinetics long-term capital of up to $300 million to support the potential commercialization of omecamtiv mecarbil and the further development of aficamten, and other general corporate purposes. The capital is available in five tranches, including an initial tranche of $50 million upon closing and four additional tranches in the aggregate amount of $250 million upon the occurrence of certain regulatory and clinical development milestones related to omecamtiv mecarbil and aficamten. Each tranche has an interest-free and payment-free period of six calendar quarters, followed by 34 calendar quarters of installment re-payments totaling 1.9 times the amount drawn.
In addition, Royalty Pharma has purchased from Cytokinetics a royalty on aficamten of 4.5% on sales up to $1 billion and 3.5% on sales above $1 billion, subject to certain potential step-downs, in exchange for payments of up to $150 million, comprised of $50 million at closing and two additional $50 million payments, conditional upon the initiation of potential pivotal clinical trials for oHCM and nHCM, respectively.
From these transactions, Cytokinetics anticipates receipt of up to $150 million in near-term funding. Together with its proforma cash at the end of 2021 which was bolstered by transactions executed by Cytokinetics last year, this funding from Royalty Pharma enables Cytokinetics to have at least two years of cash runway based on expected 2022 expenditures, inclusive of planned commercialization activities and expanded pipeline development programs.
Cooley LLP and Morrison Foerster acted as legal advisors to Cytokinetics on the transactions. Goodwin Procter, Fenwick & West, Dechert and Maiwald acted as legal advisors to Royalty Pharma.
Cytokinetics Conference Call and Webcast Information
Members of Cytokinetics’ senior management team will host a conference call and webcast today at 8:30 AM Eastern Time. The webcast can be accessed through the Investors & Media section of the Cytokinetics website at www.cytokinetics.com. The live audio of the conference call can also be accessed by telephone by dialing either (866) 999-CYTK (2985) (United States and Canada) or (706) 679-3078 (international) and typing in the passcode 5478696.
An archived replay of the webcast will be available via Cytokinetics’ website until January 21, 2021. The replay will also be available via telephone by dialing (855) 859-2056 (United States and Canada) or (404) 537-3406 (international) and typing in the passcode 5478696 from January 7, 2022 at 11:30 AM Eastern Time until January 21, 2022.
About Omecamtiv Mecarbil
Omecamtiv mecarbil is an investigational, selective, small molecule cardiac myosin activator, the first of a novel class of myotropes1 designed to directly target the contractile mechanisms of the heart, binding to and recruiting more cardiac myosin heads to interact with actin during systole. Omecamtiv mecarbil is designed to increase the number of active actin-myosin cross bridges during each cardiac cycle and consequently augment the impaired contractility that is associated with heart failure with reduced ejection fraction (HFrEF). Preclinical research has shown that omecamtiv mecarbil increases cardiac contractility without increasing intracellular myocyte calcium concentrations or myocardial oxygen consumption.
The development program for omecamtiv mecarbil is assessing its potential for the treatment of HFrEF. Positive results from GALACTIC-HF, the first Phase 3 clinical trial of omecamtiv mecarbil demonstrated a statistically significant effect of treatment with omecamtiv mecarbil to reduce risk of the primary composite endpoint of cardiovascular (CV) death or heart failure events (heart failure hospitalization and other urgent treatment for heart failure) compared to placebo in patients treated with standard of care. No reduction in the secondary endpoint of time to CV death was observed. Adverse events and treatment discontinuation of study drug were balanced between treatment arms. METEORIC-HF, a second Phase 3 clinical trial of omecamtiv mecarbil is designed to evaluate the effect of treatment with omecamtiv mecarbil compared to placebo on exercise capacity. Results from METEORIC-HF are expected in early 2022.
Aficamten is an investigational selective, small molecule cardiac myosin inhibitor discovered following an extensive chemical optimization program that was conducted with careful attention to therapeutic index and pharmacokinetic properties and as may translate into next-in-class potential in clinical development. Aficamten was designed to reduce the number of active actin-myosin cross bridges during each cardiac cycle and consequently suppress the myocardial hypercontractility that is associated with hypertrophic cardiomyopathy (HCM). In preclinical models, aficamten reduced myocardial contractility by binding directly to cardiac myosin at a distinct and selective allosteric binding site, thereby preventing myosin from entering a force producing state.
The development program for aficamten is assessing its potential as a treatment that improves exercise capacity and relieves symptoms in patients with HCM as well as its long-term effects on cardiac structure and function. Cytokinetics is currently conducting start-up activities for SEQUOIA-HCM (Safety, Efficacy, and Quantitative Understanding of Obstruction Impact of Aficamten in HCM), the Phase 3 clinical trial of aficamten in patients with symptomatic obstructive HCM. The company is also planning for an expanded development program that may evaluate aficamten in indications such as non-obstructive HCM and heart failure with preserved ejection fraction (HFpEF).
About Royalty Pharma
Founded in 1996, Royalty Pharma is the largest buyer of biopharmaceutical royalties and a leading funder of innovation across the biopharmaceutical industry, collaborating with innovators from academic institutions, research hospitals and not-for-profits through small and mid-cap biotechnology companies to leading global pharmaceutical companies. Royalty Pharma has assembled a portfolio of royalties which entitles it to payments based directly on the top-line sales of many of the industry’s leading therapies. Royalty Pharma funds innovation in the biopharmaceutical industry both directly and indirectly - directly when it partners with companies to co-fund late-stage clinical trials and new product launches in exchange for future royalties, and indirectly when it acquires existing royalties from the original innovators. Royalty Pharma’s current portfolio includes royalties on more than 40 commercial products, including AbbVie and Johnson & Johnson’s Imbruvica, Johnson & Johnson’s Tremfya, Astellas’ and Pfizer’s Xtandi, Biogen’s Tysabri, Gilead’s Trodelvy, Merck’s Januvia, Novartis’ Promacta, Vertex’s Kalydeco, Orkambi, Symdeko and Trikafta, and 10 development-stage product candidates.
Cytokinetics is a late-stage biopharmaceutical company focused on discovering, developing and commercializing first-in-class muscle activators and next-in-class muscle inhibitors as potential treatments for debilitating diseases in which muscle performance is compromised. As a leader in muscle biology and the mechanics of muscle performance, the company is developing small molecule drug candidates specifically engineered to impact muscle function and contractility. Cytokinetics is readying for the potential commercialization of omecamtiv mecarbil, its novel cardiac muscle activator, following positive results from GALACTIC-HF, a large, international Phase 3 clinical trial in patients with heart failure. Cytokinetics is conducting METEORIC-HF, a second Phase 3 clinical trial of omecamtiv mecarbil. Cytokinetics is also developing aficamten, a next-generation cardiac myosin inhibitor, for the potential treatment of hypertrophic cardiomyopathies (HCM). The company has announced positive results from Cohorts 1 and 2 in REDWOOD-HCM, a Phase 2 clinical trial of aficamten in patients with obstructive HCM. Cytokinetics is conducting start-up activities for SEQUOIA-HCM, the Phase 3 clinical trial of aficamten in patients with obstructive HCM. Cytokinetics is also developing reldesemtiv, a fast skeletal muscle troponin activator, currently the subject of COURAGE-ALS, a Phase 3 clinical trial in patients with amyotrophic lateral sclerosis (ALS). Cytokinetics continues its over 20-year history of pioneering innovation in muscle biology and related pharmacology focused to diseases of muscle dysfunction and conditions of muscle weakness.
For additional information about Cytokinetics, visit www.cytokinetics.com.
Royalty Pharma’s Forward-Looking Statements
The information set forth herein does not purport to be complete or to contain all of the information you may desire. Statements contained herein are made as of the date of this document unless stated otherwise, and neither the delivery of this document at any time, nor any sale of securities, shall under any circumstances create an implication that the information contained herein is correct as of any time after such date or that information will be updated or revised to reflect information that subsequently becomes available or changes occurring after the date hereof. This document contains statements that constitute “forward-looking statements” as that term is defined in the United States Private Securities Litigation Reform Act of 1995, including statements that express the company’s opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results, in contrast with statements that reflect historical facts. Examples include discussion of Royalty Pharma’s strategies, financing plans, growth opportunities and market growth. In some cases, you can identify such forward-looking statements by terminology such as “anticipate,” “intend,” “believe,” “estimate,” “plan,” “seek,” “project,” “expect,” “may,” “will,” “would,” “could” or “should,” the negative of these terms or similar expressions. Forward-looking statements are based on management’s current beliefs and assumptions and on information currently available to the company. However, these forward-looking statements are not a guarantee of Royalty Pharma’s performance, and you should not place undue reliance on such statements. Forward-looking statements are subject to many risks, uncertainties and other variable circumstances, and other factors. Such risks and uncertainties may cause the statements to be inaccurate and readers are cautioned not to place undue reliance on such statements. Many of these risks are outside of Royalty Pharma’s control and could cause its actual results to differ materially from those it thought would occur. The forward-looking statements included in this document are made only as of the date hereof. Royalty Pharma does not undertake, and specifically declines, any obligation to update any such statements or to publicly announce the results of any revisions to any such statements to reflect future events or developments, except as required by law. Certain information contained in this document relates to or is based on studies, publications, surveys and other data obtained from third-party sources and Royalty Pharma’s own internal estimates and research. While Royalty Pharma believes these third-party sources to be reliable as of the date of this document, it has not independently verified, and makes no representation as to the adequacy, fairness, accuracy or completeness of, any information obtained from third-party sources. In addition, all of the market data included in this document involves a number of assumptions and limitations, and there can be no guarantee as to the accuracy or reliability of such assumptions. Finally, while the company believes its own internal research is reliable, such research has not been verified by any independent source. For further information, please reference Royalty Pharma’s reports and documents filed with the U.S. Securities and Exchange Commission (“SEC”) by visiting EDGAR on the SEC’s website at www.sec.gov.
Cytokinetics’ Forward-Looking Statements
This press release contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the “Act”). Cytokinetics disclaims any intent or obligation to update these forward-looking statements and claims the protection of the Act's Safe Harbor for forward-looking statements. Examples of such statements include, but are not limited to: statements relating to the timing or availability of additional sale proceeds or loan disbursements from Royalty Pharma; Cytokinetics’ research and development activities; and the properties and potential benefits of Cytokinetics’ drug candidates. Such statements are based on management’s current expectations, but actual results may differ materially due to various risks and uncertainties, including, but not limited to, potential difficulties or delays in the development, testing, regulatory approvals for trial commencement, progression or product sale or manufacturing, or production of Cytokinetics’ drug candidates that could slow or prevent clinical development or product approval; patient enrollment for or conduct of clinical trials may be difficult or delayed; Cytokinetics’ drug candidates may have adverse side effects or inadequate therapeutic efficacy; the FDA or foreign regulatory agencies may delay or limit Cytokinetics’ ability to conduct clinical trials; Cytokinetics may be unable to obtain or maintain patent or trade secret protection for its intellectual property; standards of care may change, rendering Cytokinetics’ drug candidates obsolete; competitive products or alternative therapies may be developed by others for the treatment of indications Cytokinetics’ drug candidates and potential drug candidates may target; and risks and uncertainties relating to the timing and receipt of payments from its partners. For further information regarding these and other risks related to Cytokinetics’ business, investors should consult Cytokinetics’ filings with the Securities and Exchange Commission, particularly under the caption “Risk Factors” in Cytokinetics’ latest Quarterly Report on Form 10-Q.
CYTOKINETICS® and the C-shaped logo are registered trademarks of Cytokinetics in the U.S. and certain other countries.
Royalty Pharma Investor Relations and Communications
+1 (212) 883-6772
Senior Manager, Corporate Communications, Investor Relations
+1 (425) 314-1721