Hyperion Therapeutics To Acquire Andromeda Biotech - Quick Facts

(RTTNews) - Hyperion Therapeutics (HPTX) said it has entered into a definitive agreement to acquire Andromeda Biotech Ltd., an Israel-based subsidiary of Clal Biotechnology Industries Ltd.

Hyperion will pay $12.5 million in cash, less adjustments for expenses incurred in connection with the transaction, and 312,869 shares of Hyperion common stock

Andromeda is focused on the development of DiaPep277, a first-in-class immune intervention therapy for new onset Type 1 diabetes, an orphan indication with approximately 35,000 adults diagnosed annually across the U.S. and Europe.

DiaPep277 is currently being evaluated in a confirmatory Phase 3 clinical study in adult patients with new onset Type 1 diabetes. The Phase 3 study is fully enrolled and results are expected in the first quarter of 2015.

Hyperion will potentially make contingent payments to Andromeda security holders, of potential global regulatory and approval milestones payments that total $120 million. Up to $430 million may be paid in commercial milestones.

The potential payments include tiered contingent sales payments ranging from 10 percent on annual worldwide net sales up to $300 million to 17 percent for annual worldwide net sales that exceed $1.2 billion, with the exception of sales by distributors in certain territories, for which the rate is 25 percent.

Donald Santel, president and chief executive officer of Hyperion, said, ''The acquisition of Andromeda Biotech is a transformative event for Hyperion. We believe DiaPep277 has the potential to become a highly differentiated, first-in-class medicine for an orphan indication with a significant unmet need.''