Epizyme Inc. exercised an option to sell $50 million worth of its common stock to Royalty Pharma Ltd. under a funding agreement between the companies.
The Cambridge, Mass.-based cancer-drug developer previously entered a funding deal with Royalty Pharma in November 2019 for a capital raise of up to $270 million. Royalty Pharma had paid Epizyme $100 million up front as part of the agreement.
The deal included the option to sell an additional $50 million of shares to Royalty Pharma within 18 months for a maximum price of $20 each.
Further, the agreement also gives Dublin-based Royalty Pharma a three-year option to buy an additional 2.5 million shares for $20 apiece.
Epizyme says the additional capital from the exercise of the option will further support its operations into 2022, including its planned launch activities for cancer drug tazemetostat in epithelioid sarcoma and follicular lymphoma. The closing of the sale and issuance of the shares is subject to certain conditions.
In December 2019, Epizyme submitted an application seeking accelerated U.S. Food and Drug Administration approval for tazemetostat for follicular lymphoma, a type of blood cancer. During the same month, a panel of outside advisers to the U.S. FDA voted unanimously to approve the therapy for epithelioid sarcoma, a type of soft tissue cancer.