PhasBio Pharmaceuticals (PHAS) Stock Gains On Collaboration

PhasBio PHAS Stock News

PhaseBio Pharmaceuticals Inc (NASDAQ: PHAS) is having a great day in the market today. The stock is up over 35% early on after announcing a financing and co-development collaboration. Here’s what’s going on:

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PHAS Stock Soars On Collaboration

In a press release issued early this morning, PhasBio Pharmaceuticals announced that it has penned an important deal. The company said that it has entered into a financing and co-development collaboration with SFJ Pharmaceutcials.

The collaboration was entered into to support the development of PB2452. At the moment, PB2542 is under development as a reversal agent for the antiplatelet therapy ticagrelor in major bleeding and urgent surgery situations.

As part of the collaboration, SFJ has agreed to provide PHAS with up to $120 million in funding to support clinical development. SFJ has also agreed to assume a central role in global clinical development and regulatory activities for the asset outside of the United States.

The first up to $90 million in funding for development expenses is expected to be provided from now through the end of 2021. An additional up to $30 million will be based on PHAS meeting specific clinical milestones in the development program.

In a statement, Jonathan P. Mow, CEO at PHAS, had the following to offer:

This innovative collaboration with SFJ provides PhaseBio with substantial funding to continue the rapid advancement of our lead program, PB2452, and enables us to efficiently extend our global reach. SFJ’s global drug development and regulatory expertise, coupled with a track record of success in accelerating and advancing late-stage development programs for large, multi-national pharmaceutical companies, make it an ideal partner. The collaboration provides PhaseBio with financial flexibility while allowing us to retain full commercial rights and mitigate our global development risk.

Further Details Of The Deal

As part of the agreement PhasBio has agreed to pay SFJ a series of annual payments over the course of up to 8 years following the receipt of regulatory approvals in the United States, the EU, China or Japan.

PHAS said that the majority of these payments will be made within three to seven years following each respective regulatory approval.

Importantly, if for any reason PB2452 is not approved, the company will not owe any money to SFJ. Also, PHAS will retain exclusive worldwide commercialization rights to the asset under the collaboration agreement.

So, essentially, PHAS has put itself in a very low risk scenario. Should all go well, it and SFJ will earn significant revenue from the asset. However, if the asset fails to reach approval, the company is alleviated of much of the cost associated with development.

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