Foley Hoag Advises RTW Investments and Ji Xing Pharmaceuticals on IP Matters in Royalty Monetization and Strategic Licensing Agreement with Cytokinetics for Up to $450 Million in Upfront and Milestone Payments
July 15, 2020
Foley Hoag LLP represented global life sciences investment firm RTW Investments, LP (RTW) and Ji Xing Pharmaceuticals (Ji Xing), a biotechnology company based in Shanghai and backed by RTW and Cytokinetics, Inc. (Nasdaq: CYTK), on their strategic licensing agreement for the development and commercialization in China and Taiwan of CK-274, a next-generation cardiac myosin inhibitor designed to reduce the hypercontractility that is associated with hypertrophic cardiomyopathy (HCM). Ji Xing has committed to making an upfront payment plus $200 million in development and commercial milestones, and will pay royalties to Cytokinetics on the net sales of the product in certain Asian countries.
In addition to a direct equity investment in Cytokinetics of $50 million at $25.00 per share of common stock, RTW simultaneously entered into a broad strategic funding and equity purchase agreement with Cytokinetics, agreeing to provide development funding of up to $90 million for the development and commercialization of CK-274 for one or both indications of obstructive and non-obstructive HCM, subject to certain clinical trial milestones. RTW will receive a royalty in the low single digits on net sales of CK-274 in the United States, European Union, United Kingdom, Switzerland and certain other European countries.
In addition, RTW has agreed to purchase from Cytokinetics its royalty rights on future sales of mavacamten, for a cash purchase price of $85 million, subject to certain closing conditions.
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