Medigene AG (FSE: MDG1, Prime Standard) sells its remaining rights to the dermatological drug Veregen® and its complete stock of the corresponding active pharmaceutical ingredient (API) to the pharmaceutical company Aresus Pharma GmbH (“Aresus”), Munich, Germany. In the course of the sale, all existing relevant contracts with distribution partners and external service providers will be transferred from Medigene to Aresus. Medigene had sold the US rights to the drug at the end of 2017 to the US company Fougera Pharmaceuticals Inc. With this sale of its last product from its “non-core business”, Medigene AG completes the transformation into a pure immunotherapy company.
Prof. Dolores Schendel, Chief Executive Officer and CSO of Medigene AG, comments: “Since Medigene’s refocusing on cellular immunotherapy, the skin drug Veregen® no longer fits into our strategic position. We are very pleased that following the sale of US rights, we will now be able to hand over the remaining rights to this product to a company lead by dermatology product and clinical trial specialists. This will now allow us to focus fully on the advancement of our immuno-oncological cell therapies.”
Dr. Francisco Harrison, Director of Aresus Pharma GmbH: “We are excited to built-up Aresus as a dynamic dermatology company focusing on the further commercialization and clinical research of Veregen®. This product has various potentials to be explored and we intend to invest in expanding Veregen® into further indications and markets.”
Medigene will receive up to approximately EUR 7.75 million from Aresus for the remaining Veregen® rights and all existing API stock. Therefrom, Medigene receives EUR 300.000 upfront and the balance within the next ten years as annual revenue-based earn-out payments from 2021 onwards. These expected payments are recognized as receivables and discounted in accordance with International Financial Reporting Standards (IFRS) and due to the measurement method of the receivable at the date of the transaction. Therefore, Medigene’s EBITDA will be affected by a non-cash effective loss between EUR 4 and 5 Mio. In the future, this non-cash effective loss will be compensated by corresponding interest income as the payment period becomes continuously shorter. Medigene will update its financial guidance with respect to revenue and EBITDA with issuing its quarterly statement. The closing of the transaction including the transfer of rights is planned for mid-April 2019.
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Veregen® is an ointment for the local treatment of external genital and perianal warts (Condylomata acuminata).
Date: April 15, 2019
Source: Medigene
