October 3, 2014
By Riley McDermid, BioSpace.com Breaking News Staff
Baxter International, Inc. gave kidney drug developer Rockwell Medical a big boost in the form of $45 million in graduated payments, news that sent the smaller company’s stock price shooting up more than 17 percent in Friday morning trading.
The agreement gives Rockwell $20 million in cash, a $15 million investment in the company and another $10 million in potential milestone payments in exchange for Baxter’s exclusive distribution rights on its hemodialysis concentrate drugs.
Baxter also has the option to extend the agreement for two additional 5-year terms upon meeting certain sales targets, coupled with a $7.5 million payment related to the first extension.
“This long-term, strategic supply and distribution agreement enables Rockwell to expand and accelerate our hemodialysis concentrate business, while we continue to strategically build our drug pharma business in the U.S. and globally,” stated Robert Chioini, founder, chairman and chief executive of Rockwell, in a statement.
The deal is likely an attempt by Rockwell to piggyback on the larger company’s resources and experience as it attempts to roll out a whole suite of new proprietary drugs.
“We are excited to be partnering with Baxter, a global market leader who has a proven track record in the field of dialysis and renal products,” said Chioni. “This agreement benefits dialysis patients and service providers by expanding access to our market leading products in new territories, while reducing future risk.”
Rockwell is still waiting on the U.S. Food and Drug Administration’s ruling on its new bone marrow dialysis drug, Triferic, which is designed to deliver iron to patients noninvasively. The drug already met all endpoints in a Phase 3 trial by proving it can by boost hemoglobin and serum iron in chronic kidney disease sufferers undergoing dialysis. The FDA has indicated it will rule on Triferic by Jan. 24.
