DXB sign $120M Middle East drug commercialisation deal
Today our 2022 Biotech Pick of the Year Dimerix (ASX:DXB) just signed a licensing deal with Taiba worth up to A$120M PLUS tiered royalties on sales.
Included is a US$350,000 upfront payment by Taiba directly to DXB.
The remaining ~$120M is made up of milestone payments that DXB would receive based on development/sales milestones.
The deal also sees DXB receive a 30% tiered royalty (on net sales) that starts at 30%.
After yesterdays news DXB has managed to sign licensing deals totaling ~$340M in milestone payments and ~$11.5M in upfront payments.
AND DXB could still sign a deal over the two biggest markets - USA and China…
Right now DXB’s market cap is ~$233M, well below the licensing deals the company has managed to sign to date.
DXB is developing a drug called DMX-200 to treat a rare and nasty kidney disease called FSGS.
The company successfully completed an interim analysis which allowed it to progress towards the next stage, accelerated approvals for its drug.
This is expected to be some time next year.
This deal provides Taiba exclusive sales distribution over DXB’s treatment in the Middle East.
Taiba is a well-known company in marketing and distributing niche and rare disease medications, mainly in hematology and metabolic disorders.
So this product fits perfectly into Taiba’s portfolio.
In the Middle East, citizens typically have access to government-sponsored healthcare for their diseases, but, more importantly, orphan drug pricing is commonly set according to the country of origin.
This means that the price that DXB can sell its treatment into the Middle East will be dictated by the price it can get in Australia (or the US or EU).
DXB signed a deal with Advanz Pharmaceuticals in October last year that covered Europe, UK, Australia, NZ and Canada.
However, the two biggest markets are yet to be sold off by DXB - China and of course the USA.
We think that DXB is holding off signing deals for these two markets to maximise the value of the deal.
What is next for DXB?
🔄 Complete recruitment and dosing of 144 patients
For the next ~12-18 months, DXB’s clinical goals will be focused on completing the phase III trial. It will need to recruit 144 patients and then have these patients complete the trial before the next round of results will be announced.
🔲 Second interim results announced
The second interim analysis results will provide us with much more information about the efficacy of the DMX-200 drug. These results will actually show us how effective the treatment is against FSGS using key biomarkers.
These results will be make or break for DXB and should be a huge catalyst for the company.
🔲 Accelerated approvals granted
If the results are successful we expect DXB to move quickly towards accelerated approvals. Even if the results are strong, they will need to be strong enough to warrant accelerated approval of the drug.
🔲 Drug pricing announced for DMX-200
An important factor for the DXB story is what is the drug pricing? This is generally set by negotiations between the payers and providers (think the insurance companies / governments).
Another kidney treatment Sparsentan was priced at US$120,000 per year, per patient.
This gives an idea of what the price would be in the US (the most lucrative market), however other markets would likely command similar high prices to be paid by insurance companies / governments.
🔲China commercialisation deal
China is a big market for FSGS with over 100,000 potential patients.
🔲USA commercialisation deal
This is the big one. If DXB is able to sign a commercialisation agreement with the US it will be the most lucrative deal that the company signs.
