Cizzle Biotechnology shares jumped on Monday after announcing it had agreed a new payment schedule with its North American licensing partner Cizzle Bio Inc (BIO) that adds a further US$3.5m in guaranteed minimum royalty payments.
The additional payments, equivalent to at least US$500,000 per year, will kick in when the current agreement is extended in 2031. They sit on top of the existing US$2.4m in guaranteed advance royalties due by the end of 2026, of which US$590,000 has been received so far.
The remaining US$1.81m is expected before 31 December 2026, though the company has cautioned it may need to seek alternative funding if those payments are delayed.
Under the licence, Cizzle receives a 10% royalty on gross sales of its CIZ1B biomarker test, which is designed to detect early-stage lung cancer.
“The Company and BIO are committed to provide clinicians with an important cost-effective tool in early cancer detection which, to become scalable and widely available, requires a long-term collaborative approach,” said Allan Syms, Executive Chairman of Cizzle Biotechnology.
“The further guaranteed minimum royalty payments to be paid by BIO over the long term, along with a payment plan aligned with the launch and commercialisation of the test, means that BIO has now confirmed the Company will receive a minimum of US$5.9m over the contract term.”