Aptevo Therapeutics Inc (NASDAQ:APVO)
Aptevo Therapeutics Inc (NASDAQ:APVO) has reached an agreement for the sale of its three hyperimmune products, WinRho SDF, HepaGam, and Varizig. The sale is set to inject $74 Million into the company’s balance sheet. Investors reacted to the news by sending the stock up over 58%.
Shares of Aptevo Therapeutics Inc (NASDAQ:APVO) have been trading in a downtrend for the better part of the year. The sell-off has seen the stock reach lows of $1.07 a share. However, it appears the spin-off news has reinvigorated investor’s sentiments on the stock, seen by the recent rally to $2.40 a share.
It awaits to be seen if the proposed sale to Saol Therapeutics will continue to fuel the current bullish momentum. The selloff also comes at a time when Aptevo Therapeutics Inc (NASDAQ:APVO) has confirmed the end of its partnership with MorphoSys AG for the joint development and commercialization of MOR209/ES414, a novel treatment for certain types of mCRPC prostate cancer.
Under the terms of the definitive purchase agreement, Saol Therapeutics is to pay an upfront $6 million for the three hyperimmune products. An additional $7 Million payment is to come into effect depending on the achievement of gross profit milestones. Aptevo is also on course to receive up to $2 million related to certain accounts receivable.
Aptevo Therapeutics Inc (NASDAQ:APVO) plans to use part of the funds from the divestiture to pay part of its debt to Midcap Financial. Remaining funds are to be used to advance clinical and preclinical ADAPTIR candidates.
“With a deal value of up to $74.5 million, representing approximately 2.8 times both our current market capitalization on August 30, 2017, and our 2016 annual revenue. We view this as a very attractive opportunity to monetize our non-core assets and not dilute our stockholders,” said Marvin L. White, President, and Chief Executive Officer.
Separately, Aptevo Therapeutics Inc (NASDAQ:APVO) has confirmed it will retain worldwide development and commercialization rights for MOR209/ES414 following the termination of a partnership with MorphoSys AG. The company is in the process of carrying out the first stage of a Phase 1 continuous infusion, dose escalation clinical study. The study seeks to evaluate the safety and tolerability of APVO414 in patients with mCRPC.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: Monica has an undergraduate degree in Accounting and an MBA she earned – with Honors. She has six years of experience in the financial markets and has been an analyst for the past two years.