Potential Transaction Could Result in Near-term Revenues and Funding for Further Clinical Studies
Kalytera Therapeutics, Inc. (TSX VENTURE: KLY and OTCQB: KALTF) (the “Company” or “Kalytera”) has engaged Echelon Wealth Partners to determine the value, on a risk-adjusted basis, of its cannabidiol (“CBD”) therapeutic products for the prevention and treatment of graft versus host disease (“GVHD”), and to assist with the review of potential out-licensing opportunities for the commercial rights to these products.
Kalytera has recently received unsolicited inquiries from companies interested in the rights to Kalytera’s GVHD products, and, in response to these inquiries, Kalytera’s board of directors approved the engagement of Echelon.
“As previously discussed, the business strategy we are pursuing for our GVHD products is to out-license the commercial rights for these products after we have completed the ongoing Phase 2 study in prevention of GVHD,” stated Robert Farrell, President and CEO of Kalytera. “Consistent with this strategy, and based on the fact that we have already received unsolicited inquiries regarding the rights to these products, we have chosen to engage Echelon to determine the current risk adjusted value of these products, and to assist us in managing the process for identifying the optimum corporate partner or partners who may assist with some or all further costs for development of these products, such as the costs for Phase 3 clinical testing. Echelon will also assist Kalytera in evaluating any consideration that may be received by Kalytera for the commercial rights to its GVHD products, such as up-front license fees, and/or milestone payments and royalties.”
There can be no assurance that the review of potential out-licensing or other opportunities with respect to the Company’s GVHD products will result in a transaction or any proceeds or other consideration. Any potential transaction or other opportunity will be evaluated by Kalytera’s Board of Directors. The Company does not intend to discuss developments with respect to the review process unless a transaction is approved, or further disclosure becomes appropriate.
Kalytera intends to allocate any up-front consideration received in connection with any successful out-license or other transaction in respect of its GVHD program to research and development work required to expedite the development of its proprietary cannabinoid compound for treatment of pain, as well as other preclinical cannabinoid development programs.
Status of GVHD Program
Kalytera’s product development program evaluating CBD in the prevention of acute GVHD consists of three separate clinical studies: (1) Study KAL-05; (2) Study KAL-07; and (3) Study KAL-08.
Study KAL-05 is the Company’s ongoing open label, multicenter, Phase 2 clinical study to evaluate multiple doses of CBD for the prevention of acute GVHD following allogeneic hematopoietic cell transplantation, commonly referred to as bone marrow transplantation. The study is evaluating the PK profile, safety, and efficacy of CBD at doses of 75, 150, and 300 mg twice daily (“BID”). The first 12-patient cohort was administered the low dose of 75 mg BID, and this cohort has completed the study with very encouraging results, as previously reported. The second 12-patient cohort, is being administered the medium dose of 150 mg BID, and this cohort is currently being enrolled. It is anticipated that Study KAL-05 will be complete later this year, and will provide support for the planned Phase 3 registration study required for regulatory approval by the FDA.
Study KAL-07, the “food effect study”, is a double blind, randomized, two period, two treatment, fixed sequence, crossover (fed versus fasted) study to evaluate the effect of food on the pharmacokinetics of CBD, along with robust ECG monitoring in 32 healthy volunteers. This study is being conducted at a single site in Melbourne, Australia.
FDA guidelines also require that a proposed new drug be evaluated for its effects on cardiac rhythm. This evaluation is typically done in a separate study known as a QT or QTc study. To save time and expense, Kalytera is including a robust ECG evaluation of each subject enrolled in Study KAL-07. By including this evaluation in the design of Study KAL-07, the Company will be able to complete another critical study evaluation on the pathway to registration, without having to initiate a separate QT or QTc study for this purpose.
Study KAL-08, the “drug-drug interaction study”, is a second healthy volunteer study that has been requested by the FDA. This drug-drug interaction study will measure the effect of certain anti-fungal drugs upon metabolism of CBD, and the Company anticipates that it will complete Study KAL-08 during the third quarter this year. This study will also be conducted at a single site in Melbourne, Australia.
Echelon is a leading independent, Canadian-owned and operated wealth management and capital markets firm, with more than $5 billion in assets under administration and management. Echelon provides full service investment banking services and equity research across a range of industries. Their team of investment bankers provides access to strategic advisory, M&A, analysis and valuation services, as well as creative equity and debt solutions.
Kalytera Therapeutics, Inc. (“Kalytera”) is pioneering the development of a next generation of cannabinoid therapeutics. Through its proven leadership, drug development expertise, and intellectual property portfolio, Kalytera seeks to establish a leading position in the development of novel cannabinoid medicines for a range of important unmet medical needs, with an initial focus on graft versus host disease and the treatment of acute and chronic pain.
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This press release may contain certain forward-looking information and statements (“forward-looking information”) within the meaning of applicable Canadian securities legislation, that are not based on historical fact, including without limitation in respect of its product candidate pipeline, planned clinical trials, regulatory approval prospects, intellectual property objectives, review of out-licensing and other opportunities with respect to its GVHD products and any potential transaction relating thereto or proceeds thereof and other statements containing the words “believes”, “anticipates”, “plans”, “intends”, “will”, “should”, “expects”, “continue”, “estimate”, “forecasts” and other similar expressions. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risk that future clinical studies may not proceed as expected or may produce unfavourable results, the uncertainty associated with being able to identify, evaluate and complete any out-licensing transaction or other opportunity, and the impact on the Company’s business of the announcement of the review of out-licensing or other opportunities and any opportunity or transaction that may actually be pursued. Kalytera undertakes no obligation to comment on analyses, expectations or statements made by third parties, its securities, or financial or operating results (as applicable). Although Kalytera believes that the expectations reflected in forward-looking information in this press release are reasonable, such forward-looking information has been based on expectations, factors and assumptions concerning future events which may prove to be inaccurate and are subject to numerous risks and uncertainties, certain of which are beyond Kalytera’s control. The forward-looking information contained in this press release is expressly qualified by this cautionary statement and is made as of the date hereof. Kalytera disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.