Health and Healthcare

Athersys Soars on Japanese License Deal

Chris Lange

Published: January 8, 2016 12:40 pm

Last Updated: January 13, 2020 3:15 pm

Athersys Inc. (NASDAQ: ATHX) led the bulls on Friday following news of a new partnership and license agreement. The company announced an agreement that will focus on the development and commercialization of novel cell therapy treatments, including MultiStem for the treatment of ischemic stroke and potentially other indications, in Japan.

As per the terms of the agreement, Healios will have exclusive rights for the development of MultiStem for treating ischemic stroke in Japan. Healios will develop and commercialize the product in Japan, and Athersys will provide the manufactured product and support to Healios, while retaining all rights outside of Japan.

Also as part of the license, Athersys will receive an initial license fee of $15 million, as well as have the opportunity to earn milestone and royalty payments.

Development and approval milestones for stroke could total as much as $30 million, in addition to sales milestones that could reach $185 million based on successful commercialization and the achievement of substantial sales of an approved product for treating stroke in Japan.

Dr. Kiyohiro Houkin, chairman and Professor of Neurosurgery at Hokkaido University Medical School, and President of Hokkaido University Hospital, commented:

Stroke represents a major problem, both in Japan and globally. Currently available treatments such as tPA and mechanical thrombectomy must be administered within the first several hours after the stroke occurs, limiting treatment to a small percentage of patients, and such interventions may also pose certain risks. The recently conducted international clinical study by Athersys in the U.S. and the U.K. suggests that intravenous administration of MultiStem within 36 hours of the occurrence of a stroke is safe, well-tolerated, and is a beneficial and effective treatment. The off-the-shelf administration of the product could be a simple and universal approach for treating acute stroke patients. Furthermore, it could be administered to patients that do not arrive at the hospital in time to receive current standard of care, or alternatively could be administered in addition to tPA or mechanical reperfusion, potentially enhancing outcomes for patients that have suffered significant strokes. If efficacy is confirmed in additional studies, it is possible that this therapy could become the new standard of care for treating stroke.

Shares of Athersys were trading up 25% at $1.28 Friday, with a consensus analyst price target of $4.25 and a 52-week trading range of $0.90 to $3.43.