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minimum revenues of approximately $165 million
Significant increase compared to original minimum revenues of $110 million
Royalty's payments to Kamada to start no earlier than 2017, which should have positive impact on Kamada profitability through the term of the agreement
Kamada successfully achieved an additional milestone in the agreement and is expected to receive $4.5 million during 2013
Ness Ziona, Israel, May XX, 2013. Kamada Ltd (TASE: KMDA), an orphan drug focused, plasma-derived protein therapeutics company with an existing marketed product portfolio and a robust late-stage product pipeline, announced today the extension to its strategic agreement with Baxter. As a result, Kamada expects that total revenue from 2010 until 2016 will increase to a minimum of $165 million, compared to a minimum of $110 million expected upon the signature of the original agreement in 2010.
In addition, the company reports that the distribution by Baxter of Glassia produced by Kamada has been extended through 2016 and that the transition to the royalty payments for Glassia produced by Baxter is expected in 2017. Until that time Kamada will continue to produce Glassia for distribution by Baxter, which the company expects will result in higher profitability for Kamada in 2015 and 2016.
Kamada also reports that it has achieved an additional milestone under the technology license agreement with Baxter, earning a payment of $4.5 million, which is expected to be paid this year.
The company believes it will have the ability to support the increased demand from Baxter through the term of the agreement as well as to support the expected increased demand following the anticipated launch of inhaled AAT for AATD in Europe in 2015 and in the US in 2016, subject to approval.
Kamada and Baxter have entered three years ago into an exclusive strategic cooperation agreement for the distribution and license of the Kamada intravenous AAT product. Under the agreement, Baxter is the exclusive distributor of Glassia in US, Canada, Australia and New Zealand and is licensed to produce Glassia using Kamada's technology at a Baxter facility for sales in the above-mentioned countries only.
David Tsur, CEO said “the extension of the agreement is a major achievement for Kamada and attests to the quality of the relationship between the companies and the increased demand for Glassia in the US. We believe that total revenues may exceed the minimum amount. Baxter is one of the largest biopharmaceutical companies in the world with proven capabilities and a great reputation in the development and launch of new drugs. These capabilities are helping Kamada through successful marketing of Glassia and preparation to leverage the potential of this product. To date, Kamada has met all of its commitments under the agreement and the partnership continues to move in the right direction.
We believe this expansion of the agreement enables Kamada to reach significant sales in the US market while keeping a high profit margin. This success strengthens our financial position and enables us to continue our development efforts to bring additional products for additional indications to the market, mainly our next generation product, inhaled AAT, which we expect to announce results from our pivotal trial in Europe at the beginning of 2014 and our product to treat newly diagnosed type-1 diabetes patients, which we expect could be a breakthrough.”
In 2013, Kamada expects to complete its pivotal multi-center phase 2/3 clinical trial in Europe for the treatment of AAT deficiency through inhalation and to publish its results at the beginning of 2014. In addition, the company is preparing to start a phase 2 study for the same product in the U.S. in the second half of 2013. In parallel, the company is preparing to start a phase 2 or phase 2/3 clinical trial this year to treat newly diagnosed type-1 diabetes patients with the intravenous AAT product, for which the company has already successfully completed a phase 1-2 clinical trial.
Kamada also recently reported the commencement of treatment of patients in the phase 2/3 clinical trial for KamRAB, Kamada's prophylaxis of Rabies product, which is being conducted in the US as part of the strategic partnership with Kedrion. Kedrion will distribute the product in the US subject to FDA approval.
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Additional information is available at www.kamada.com
Cautionary Note Regarding Forward-Looking Statements
This release contains forward-looking statements that involve risks, uncertainties and assumptions, such as statements regarding the EMA and US FDA marketing authorization of our Inhaled AAT for AATD, timing of clinical trials. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including, but not limited to, delays or denial in the US FDA or the EMA approval process, additional competition in the AATD market, further regulatory delays. The forward-looking statements made herein speak only as of the date of this release and the Company undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.
We are an orphan drug focused, plasma-derived protein therapeutics company with an existing marketed product portfolio and a robust late-stage product pipeline. We develop and produce specialty plasma-derived protein therapeutics and currently market these products through strategic partners in the United States and directly, through local distributors, in several emerging markets. We use our proprietary platform technology and know-how for the extraction and purification of proteins from human plasma to produce Alpha-1 Antitrypsin (‘‘AAT'') in a high purity, liquid form, as well as other plasma-derived proteins. AAT is a protein derived from human plasma with known and newly discovered therapeutic roles given its immuno-modulatory, anti-inflammatory, tissue protective and antimicrobial properties. Our flagship product, Glassia, is the first and only liquid, ready-to-use, intravenous plasma-derived AAT product approved by the United States Food and Drug Administration (the ‘‘FDA''). We market Glassia through a strategic partnership with Baxter International Inc. in the United States. Additionally, we have a product line consisting of nine other injectable pharmaceutical products which are marketed, in addition to Glassia, in more than 15 countries, including Israel, Russia, Brazil, India and other countries in Latin America, Eastern Europe and Asia. We currently have five plasma-derived protein products in our development pipeline, including an inhaled formulation of AAT for treatment of AAT deficiency that is in pivotal Phase II/III clinical trials in Europe and entering into Phase II clinical trials in the United States. In addition, we leverage our expertise and presence in the plasma-derived protein therapeutics market by distributing ten complementary products in Israel that are manufactured by third parties.