CollPlant Holdings Ltd. (TASE: CLPT; Nasdaq: CLGN) has announced a strategic collaboration agreement with United Therapeutics Corporation (UTHR), a world leader in lung disease treatments.
Under the agreement, United Therapeutics will use Collplant's "biological ink" (collagen produced from plant sources that can be used in a 3D printer as a scaffolding for producing implants) in its project to produce a 3D bioprinted lung transplant.
United Therapeutics will pay Collplant an upfront payment of $5 million and milestone payments of up to $15 million based on the achievement of certain operational and regulatory milestones related to the development of manufactured lungs. The agreement also provides for option exercise payments of up to $9 million, and additional developmental milestone payments of up to $15 million if United Therapeutics elects to develop manufactured organs other than lungs using CollPlant's technology. CollPlant will also be entitled to receive royalties on sales of commercialized products covered by patents licensed from CollPlant, as well as reimbursement for certain costs. The agreement is subject to certain closing conditions, including receipt of approval of the agreement by the Israel Innovation Authority. Collplant grants United Therapeutics exclusivity in lung transplants. For other manufactured organs, United Therapeutics will receive exclusivity if it exercises its option.
At 10:44 this morning trading in Collplant stock was suspended pending announcement of a material event. Trading in the stock resumed at 11: 23 and the company's share price is currently up 38%. The share price had fallen 43% in the year to yesterday's close. The stock is due to be delisted from the Tel Aviv Stock Exchange on October 30, after which it will continue to be traded on Nasdaq.
Collplant CEO Yehiel Tal said, "We strongly believe that our proprietary and proven rhCollagen is the finest building block for regenerative medicine scaffolds available today, and will play a critical role in the organ manufacturing process. As a pioneer in the field, United Therapeutics is the perfect partner for us. This strategic agreement is a major achievement for CollPlant as it aligns us with a global leader, validates our technology and creates value for our shareholders. We are honored to have established this important collaboration with United Therapeutics and look forward to working together to bring lifesaving organs to humanity."
Published by Globes, Israel business news - en.globes.co.il - on October 22, 2018
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