Radius Health, Inc. (RDUS - Free Report) announced a definitive agreement to acquire the global development and commercialization rights of Benuvia Therapeutics Inc.’s synthetic cannabidiol oral solution (“RAD011”).
RAD011 is a synthetic cannabidiol oral solution with potential utilization in multiple endocrine and metabolic orphan diseases.
The initial indication, for which the candidate will be evaluated, is Prader-Willi syndrome (“PWS”).
Radius intends to begin a phase II/III study on the candidate for patients suffering from PWS in the second half of this year, pending regulatory discussions with the FDA.
RAD011 was granted Fast Track Designation in 2017 and Orphan Drug Designation in August 2020 for the treatment of hyperphagia behavior and weight loss in patients with PWS.
Per the agreement, Radius acquired RAD011 for $12.5 million. It will also pay an additional $15 million on the successful conclusion of PWS development milestones. The company may also pay up to $45 million in development milestones for any of the next three indications. In addition, Radius might make sales-based milestone payments and a tiered, high-single-digit effective royalty.
The acquisition did not result in any equity dilution to Radius’ shareholders, as the company has financed the acquisition through cash on hand and the utilization of $15 million from an existing debt facility. It expects the combination of a rationalized cost structure and ongoing growth in lead drug, Tymlos, to fully fund the development of RAD011. As part of this transaction, Radius expects to take a one-time charge of up to $16 million in the fourth quarter of 2020.
We note that Radius’ abaloparatide subcutaneous injection, marketed as Tymlos, is approved by the FDA for the treatment of postmenopausal women with osteoporosis at high risk for fracture, defined as history of osteoporotic fracture, multiple risk factors for fracture, or patients who have failed or are intolerant to other available osteoporosis therapies.
The acquisition leverages Radius’ endocrine expertise and adds a late-stage pivotal trial-ready orphan disease product to its existing phase III programs for abaloparatide and elacestrant.
Earlier, the company entered into definitive agreements with Endo Ventures Limited, a subsidiary of Endo International plc , to register, commercialize and distribute abaloparatide on an exclusive basis in Canada.
Shares of Radius have gained 12.1% in the past year against the industry’s decline of 1.8%.
Tymlos generated sales worth $148.5 million in the first nine months of 2020, reflecting an increase of 26.2% year over year. However, competition in the market remains stiff from bigwigs like Eli Lilly’s (LLY - Free Report) Forteo and Amgen's (AMGN - Free Report) Prolia. Hence, the successful development of other treatments will diversify Radius’ revenue base.
Radius currently carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Radius Health, Inc. (RDUS - Free Report) announced a definitive agreement to acquire the global development and commercialization rights of Benuvia Therapeutics Inc.’s synthetic cannabidiol oral solution (“RAD011”).
RAD011 is a synthetic cannabidiol oral solution with potential utilization in multiple endocrine and metabolic orphan diseases.
The initial indication, for which the candidate will be evaluated, is Prader-Willi syndrome (“PWS”).
Radius intends to begin a phase II/III study on the candidate for patients suffering from PWS in the second half of this year, pending regulatory discussions with the FDA.
RAD011 was granted Fast Track Designation in 2017 and Orphan Drug Designation in August 2020 for the treatment of hyperphagia behavior and weight loss in patients with PWS.
Per the agreement, Radius acquired RAD011 for $12.5 million. It will also pay an additional $15 million on the successful conclusion of PWS development milestones. The company may also pay up to $45 million in development milestones for any of the next three indications. In addition, Radius might make sales-based milestone payments and a tiered, high-single-digit effective royalty.
The acquisition did not result in any equity dilution to Radius’ shareholders, as the company has financed the acquisition through cash on hand and the utilization of $15 million from an existing debt facility. It expects the combination of a rationalized cost structure and ongoing growth in lead drug, Tymlos, to fully fund the development of RAD011. As part of this transaction, Radius expects to take a one-time charge of up to $16 million in the fourth quarter of 2020.
We note that Radius’ abaloparatide subcutaneous injection, marketed as Tymlos, is approved by the FDA for the treatment of postmenopausal women with osteoporosis at high risk for fracture, defined as history of osteoporotic fracture, multiple risk factors for fracture, or patients who have failed or are intolerant to other available osteoporosis therapies.
The acquisition leverages Radius’ endocrine expertise and adds a late-stage pivotal trial-ready orphan disease product to its existing phase III programs for abaloparatide and elacestrant.
Earlier, the company entered into definitive agreements with Endo Ventures Limited, a subsidiary of Endo International plc , to register, commercialize and distribute abaloparatide on an exclusive basis in Canada.
Shares of Radius have gained 12.1% in the past year against the industry’s decline of 1.8%.
Tymlos generated sales worth $148.5 million in the first nine months of 2020, reflecting an increase of 26.2% year over year. However, competition in the market remains stiff from bigwigs like Eli Lilly’s (LLY - Free Report) Forteo and Amgen's (AMGN - Free Report) Prolia. Hence, the successful development of other treatments will diversify Radius’ revenue base.
Radius currently carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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