PhaseBio Pharmaceuticals reported its collaboration partner, SFJ Pharmaceuticals Group, informed the company it would need to return the rights to its lead program.
In a Sept. 21 filing with the U.S. Securities and Exchange Commission, PhaseBio Pharmaceuticals reported its collaboration partner, SFJ Pharmaceuticals Group, informed the company it would need to return the rights to its lead program.
The two organizations entered a co-development collaboration deal on Jan. 10, 2020, to develop and commercialize bentracimab, a drug designed to reverse the effects of AstraZeneca’s blood thinner Brilinta (ticagrelor).
“SFJ has elected to cause the Company’s business related to bentracimab to be transferred to SFJ as a result of the Company’s failure to remedy its Going Concern Condition within the Going Concern Cure Period,” PhaseBio wrote in the SEC filing.
As a result, SFJ expects PhaseBio to transfer the rights to the drug within 10 days.
The Going Concern Condition was originally included in PhaseBio’s annual report on Form 10-K of the year ending Dec. 31, 2021. Since that announcement, PhaseBio has worked to address it, Efforts include engaging a financial advisor to help find companies interested in partnering to advance clinical development of bentracimab if regulators approve.
Despite receiving several offers PhaseBio’s board of directors “found compelling,” each request would have required SFJ to “refrain from (1) terminating the Co-Development Agreement and (2) asserting accelerated termination payment obligations.” This meant PhaseBio could not move forward with any of those deals.
PhaseBio and SFJ have also been negotiating since early 2022 over the possible transfer of bentracimab program assets to SFJ but have not been able to reach an agreement. SFJ withdrew from the negotiations and informed PhaseBio about the transfer the day after the Going Concern Period expired.
SFJ Pharmaceuticals, backed by Abingworth Ventures and Blackstone Life Sciences, partners with biopharma companies. It supplies incremental budget and global clinical development resources to advance drugs toward regulatory approval in exchange for future revenue.
In the original agreement, SFJ agreed to fund up to $120 million to support the clinical development of bentracimab and to take on a major role in global clinical development and regulatory activities outside the United States. SFJ also agreed to fund up to $90 million in development expenses through the end of 2021. PhaseBio was eligible for another $30 million in pre-defined clinical milestones.
The deal was to extend for seven to eight years after various regulatory approvals in the U.S., Europe, China and Japan. The majority of payments to SFJ are due in years three to seven.
“Based on the clinical data generated to date and following an extensive diligence process conducted in conjunction with our partners at Blackstone Life Sciences and Abingworth, we believe that PB2452 has great potential to address a significant unmet need,” stated Bob DeBenedetto, CEO of SFJ, at the time.
In PhaseBio’s Form 10-Q filed Mar. 31, 2021, the company noted a “going concern” footnote is included in any of its financial statements. If “we fail to remedy such going concern condition as specified in the agreement, SFJ may elect to have our business related to bentracimab transferred to SFJ,” the note read.
In its second-quarter report for the period ending June 30, the company reported cash and cash equivalents of $7.8 million, representing a net loss for the quarter of $16.7 million. Research and development expenses for the quarter dropped to $20.9 million from $27.4 million for the same period in 2021.
