Alimera Sciences, Inc.announced its acquisition of additional commercialization rights for YUTIQ (fluocinolone acetonide intravitreal insert) 0.18mg for the treatment of chronic non infectious uveitis affecting the posterior segment of the eye from EyePoint Pharmaceuticals, Inc. (EyePoint).
“This is a landmark transaction for Alimera, bringing critical mass to our revenue base and leveraging the commercial infrastructure we have built in the U.S. We know this product very well, having marketed ILUVIEN for the uveitis indication in Europe and the Middle East for several years now. We believe there are immediate synergies in adding YUTIQ to our portfolio that will be accretive to revenue, Adjusted EBITDA and cash flow in the second half of 2023,” said Rick Eiswirth, Alimera’s president and CEO. “EyePoint has done a wonderful job growing YUTIQ to almost $30 million in revenue in 2022. We believe that deploying a larger commercial team focused on both ILUVIEN and YUTIQ will increase utilization of both products moving forward and expect Alimera to generate in excess of $100 million in net revenue and $20 million in Adjusted EBITDA* in 2024.”
YUTIQ net product revenue increased 60% to $7.4 million in Q1 2023 compared with $4.6 million in Q1 2022. For the full year of 2022, YUTIQ net product revenue increased 67% to $28.3 million compared to $16.9 million in 2021.**
Alimera now has exclusive global rights to YUTIQ excluding China, Hong Kong, Taiwan, Macau, South Korea and Southeast Asia, where EyePoint has a pre-existing license with Ocumension Therapeutics.
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* See “Non-GAAP Financial Measures” below. ** According to EyePoint’s SEC reports.
Under the terms of the agreement with EyePoint:
• Alimera made an upfront cash payment of $75 million at closing; an additional $7.5 million will be paid in equal quarterly installments in 2024.
• EyePoint will also receive potential royalties from 2025 to 2028 based on combined net revenues in the U.S. from ILUVIEN and YUTIQ in excess of certain thresholds, beginning at $70 million in 2025 and increasing annually thereafter.
• Alimera will immediately assume control of all commercial activities related to YUTIQ in the U.S.
Alimera funded the upfront payment and obtained additional working capital with:
• A $69 million private placement of Series B preferred stock and common stock to a syndicate of investors led by Velan Capital and Caligan Partners. • Borrowing of an additional $20 million through an amendment to its existing term loan agreement with SLR Capital Partners, LLC.
“We deeply appreciate the support of SLR Capital and our new shareholders with this transformative transaction for Alimera,” continued Mr. Eiswirth.
Board of Directors changes
In conjunction with these transactions, Alimera has added Jason Werner to its Board of Directors, as a designee of Velan Capital. Prior to this appointment, long-term board member, Garheng Kong, resigned as director.
“On behalf of the entire board and management, I would like to express our sincerest gratitude to Garheng for his dedication to Alimera for almost twenty years. His committed leadership has played a crucial role in our growth and development as an organization,” said Eiswirth. “We are fortunate to have Jason joining our Board of Directors, and excited about the ophthalmic and operational experience he brings as we integrate YUTIQ into our portfolio and continue to grow Alimera.”
Werner currently serves as the CEO of SightStream Biotherapeutics Inc., a biotechnology company focused on developing regenerative medicines in ophthalmics. Werner also currently serves on the board of directors of InflammX Therapeutics Inc, a privately-held developer of novel treatments of the Inflammasome (NLRP3) Pathway based in San Diego, California.
Werner previously co-founded and served as COO of Eyevance Pharmaceuticals through its sale to Santen Pharmaceuticals Ltd. He has held a variety of Commercial Development roles and Corporate Strategy positions at companies such as Sun Pharma, Nicox SA and Inspire Pharmaceuticals, all within the field of ophthalmics. Mr. Werner received his B.S. in business administration from the University of New Hampshire.
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* See “Non-GAAP Financial Measures” below. ** According to EyePoint’s SEC reports.
Securities Purchase Agreement
Alimera issued 1,401,901 shares of its common stock and 66,617 shares of its Series B Preferred Stock in exchange for an aggregate of $69 million in gross proceeds. Upon approval by Alimera’s stockholders, the Series B Preferred Stock issued in this second tranche will be mandatorily convertible into 39,186,471 shares of Alimera common stock, subject to adjustment. The purchase price of the common stock and the initial conversion price of this second tranche of Series B Preferred Stock is $1.70 per share. In connection with the funding of this second tranche, the purchasers of the first tranche of Series B Preferred Stock forfeited 4,114,286 of the common stock warrants obtained in connection with the first tranche funding for no consideration.
Amendment to the Loan and Security Agreement
The term loan amendment increased the available amount under the facility from $15 million to $20 million, all of which was funded in connection with the transactions. The maturity date on the facility remains April 30, 2028, with monthly interest-only continuing to May 1, 2025, when principal amortization begins. The interest-only period may be extended an additional 12 months if Alimera achieves $7.5 million in Adjusted EBITDA, as defined in the amended agreement, for any trailing 12-month period ending on or before March 31, 2025. Interest on outstanding borrowing under the term loan is payable at the greater of one-month SOFR or 4.60% plus 5.15% per annum.
The securities sold in the private placement have not been registered under the Securities Act of 1933, as amended, or state securities laws and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission (SEC) or an applicable exemption from such registration requirements. Alimera has agreed to file one or more registration statements with the SEC registering the resale of the shares of common stock issued and issuable upon conversion of the Series B Preferred Stock issued in the private placement.