The next Sage? Shkreli partner Ligand puts together another sweet startup package deal for Seelos
San Diego-based Ligand Pharmaceuticals $LGND has created a startup licensing package for a still incipient drug developer, complete with a built-in loan and some modest upfront terms for a pipeline that includes a Phase III-ready Parkinson’s drug.
The startup is called Seelos Therapeutics, which is registered in New York and run by one Raj Mehra.
In the deal, which has an interesting structure, Seelos can pay $1.3 million in equity or cash once it raises $7.5 million in venture backing. There’s another $3.5 million due if the company becomes public. And if certain unspecified conditions are met, Ligand will throw in a $500,000 loan.
Ligand CEO John Higgins, who enjoys a $2.4 billion market cap, says this latest deal is a lot like the pacts he struck to get Retrophin, Sage and the microcap Viking $VKTX started, which went public based on drugs amped up with its technology to optimize the solubility and stability of drugs. If these drugs work in Phase III and go on to an approval, Ligand is in line for royalties and up to $145 million in milestones.
Ligand helped Martin Shkreli get set up in business as a biotech exec in 2012, working a $1 million-down licensing pact. The biotech $RTRX now has an $857 million market cap, though Shkreli later got kicked out of the company on his way to being charged on fraud allegations. And Sage $SAGE has been advancing SAGE-547, which it unlicensed in 2011.
The set of therapies covered in the most recent deal include Ligand’s aplindore program for the treatment of various CNS disorders, a CRTH2 antagonist program for the treatment of respiratory disorders, a Captisol-enabled acetaminophen program for pain and fever management and an H3 receptor antagonist program for the treatment of narcolepsy.
Mehra had this to say:
“This partnership highlights Seelos’ focus on developing late-stage CNS product candidates with proven mechanism of action. SLS-006, one of the lead assets acquired in this agreement, is a Phase-III ready and clinically-validated partial dopamine agonist that is well-positioned to advance in development with a goal to provide relief to an estimated 1.5 million Parkinson’s disease patients in the developed world.”