APTEVO THERAPEUTICS INC. (NASDAQ:APVO) Files An 8-K Entry into a Material Definitive Agreement

APTEVO THERAPEUTICS INC. (NASDAQ:APVO) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement

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On March 30, 2021, Aptevo Therapeutics Inc. (“Aptevo” or the “Company”) entered into and closed a royalty purchase agreement (the “Royalty Purchase Agreement”) with an entity managed by HealthCare Royalty Management, LLC (“HCR”) to which the Company sold to HCR the right to receive all royalty payments made by Pfizer Inc. (“Pfizer”) in respect of net sales of RUXIENCE. Under the terms of the Royalty Purchase Agreement, the Company received $35 million (the “Investment Amount”) at closing and the Company is eligible to receive additional payments in aggregate of up to an additional $32.5 million based on the achievement of sales milestones. The sales tiers required to earn the total of $32.5 million in milestones are as follows: up to $10 million in 2021, payable at $3.5 million if RUXIENCE net sales equal or exceed $350 million plus an additional $6.5 million if RUXIENCE net sales equal or exceed $395 million; up to $12.5 million in 2022, payable at $2.5 million if RUXIENCE net sales equal or exceed $450 million plus an additional $4.5 million if RUXIENCE net sales equal or exceed $500 million plus an additional $5.5 million if RUXIENCE net sales equal or exceed $525 million; and $10 million in 2023 if RUXIENCE net sales equal or exceed $570 million (collectively, the “Milestone Amounts”). The Royalty Purchase Agreement further provides that, once HCR reaches aggregate royalty payments totaling 190% of the Investment Amount plus the Milestone Amounts to the extent paid by HCR to the Company, Aptevo will be entitled to receive 50% of any additional royalty payments by Pfizer thereafter.

In connection with the Royalty Purchase Agreement, the Company amended its Credit Agreement with MidCap Financial and used $10 million of the proceeds received from the Royalty Purchase Agreement with HCR to pay down the outstanding principal under this agreement from $25 million to $15 million. $10 million of the remaining $15 million principal balance will be payable on March 31, 2022. Beginning March 1, 2022, monthly repayment of the remaining $5 million of principal will commence and continue for the final 30 months of the loan term. If the Company sells the IXINITY deferred payment stream and milestones prior to full repayment of this $5 million principal amount, under the agreement with MidCap Financial, proceeds from same will be applied to pay down the outstanding loan principal balance. MidCap Financial also released its security interest in the RUXIENCE royalty payments. A fee of $550,000 was paid by the Company to MidCap Financial in connection with the amendment in lieu of the formula-based fee previously required.

The foregoing descriptions of the Royalty Purchase Agreement and the amendment to the Credit Agreement is a summary, is not complete, and is qualified in its entirety by the full text of the Royalty Purchase Agreement and the amendment to the Credit Agreement, copies of which the Company intends to file as an exhibit to its Quarterly Report on Form 10-Q for the quarter ended March 31, 2021.

Item 2.02. Results of Operations and Financial Condition.

On March 31, 2021, the Company issued a press release announcing its financial results for the period ended December 31, 2020 and providing a business update (the “Press Release”). A copy of the Press Release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The disclosure set forth under Item 1.01 is incorporated herein by reference.

Item 7.01. Regulation FD Disclosure.

A copy of the Press Release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

The information in this Item 7.01, including the exhibit hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing with the U.S. Securities and Exchange Commission made by the Company, whether made before, on or after the date hereof, regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in such filing.

(d) Exhibits

Aptevo Therapeutics Inc. Exhibit
EX-99.1 2 apvo-ex991_6.htm EX-99.1 apvo-ex991_6.htm   EXHIBIT 99.1   For Immediate Release   APTEVO THERAPEUTICS REPORTS 2020 FINANCIAL RESULTS AND PROVIDES BUSINESS UPDATE   Advances Phase 1/1b Study of APVO436 for Treatment of Acute Myeloid Leukemia and High-Grade Myelodysplastic Syndrome; Enrollment in Cohort 10 Ongoing   Completes Sale of RUXIENCE Royalty Payments for  Up Front Plus Milestone Payments of up to $67.5 million; Amends Non-Dilutive Term Loan Agreement     SEATTLE,…
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About APTEVO THERAPEUTICS INC. (NASDAQ:APVO)

Aptevo Therapeutics Inc. is a biotechnology company. The Company is focused on oncology and hematology therapeutics. The Company is engaged in the discovery, development, commercialization and sale of oncology and hematology therapeutics. The Company’s technology is the ADAPTIR (modular protein technology) platform. The Company has approximately four products in the areas of hematology and infectious diseases, as well as various investigational-stage product candidates in immuno-oncology. The Company’s investigational-stage product candidates include MOR209/ES414, ES210, ES425, Otlertuzumab and 5E3. Its technology can produce monospecific and multispecific immunotherapeutic proteins that bind to various targets. The Company’s marketed products are WinRho SDF (Rho(D) Immune Globulin Intravenous (Human)), HepaGam B (Hepatitis B Immune Globulin Intravenous (Human)), VARIZIG (Varicella Zoster Immune Globulin (Human)), and IXINITY (coagulation factor IX (recombinant)).

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