Mayne Pharma Group Ltd. signed a deal with Mithra Pharmaceuticals SA to sell its experimental contraceptive drug in the U.S. for a mix of cash and equity plus a potential seat on Mayne's board.
Mithra's estrogen-based drug, E4/DRSP, met its main goal in two phase 3 studies and is expected to be released in the first half of 2021 if it is approved by the U.S. Food and Drug Administration.
Mayne will pay $8.8 million in cash and 4.95% of its ordinary shares at closing, plus contingent payments based on sales targets, for a total potential deal value of $295 million, assuming that cumulative net sales exceed $2.25 billion. There is also a transfer price with a fixed and variable component based on a percentage of net sales over the term of the license.
Mayne Pharma will also pay $11 million in cash and a further 4.65% in ordinary shares after the drug receives approval from the FDA. Belgium-based Mithra would have a total stake of 9.6% in the Australian company if the drug is approved.
The deal also includes a future seat on Mayne's board for Mithra if the FDA approves the drug and if Mayne shareholders sign off on it.
The oral contraceptive contains Estetrol, also known as E4, a weak estrogen steroid hormone normally produced by the fetal liver during pregnancy. Mithra has developed the ability to produce E4 through a plant-based production process.
If the drug is approved, E4 will be the first native estrogen approved in a contraceptive product in the U.S. and the first new estrogen introduced in the U.S. in about 50 years, Mayne Pharma CEO Scott Richards said in a news release. The drug could have patent protection beyond 2030 if it receives a five-year new chemical entity exclusivity designation from the FDA.
Mayne Pharma's existing pipeline includes a copycat of the NuvaRing contraceptive device that it is licensing from Mithra Pharmaceuticals and that is slated for approval in 2020.
The U.S. contraceptive market is valued at $5.4 billion, according to IQVIA data.
