ValiRx shares soared on Friday on the announcement of a major licensing deal worth up to £16 million plus royalties after Ambrose Healthcare Ltd exercised its option to license the VAL401 cancer treatment asset.
The AIM-listed life sciences company announced that Ambrose served notice to exercise the pre-agreed option on VAL401, triggering an Intellectual Property Licence Agreement between the parties.
ValiRx will receive 576,000 ordinary shares in Ambrose immediately, with clinical and commercial milestone payments totalling up to £16 million plus ongoing royalties.
The news was cheered by investors, and the stock surged 30% on Friday.
“We are pleased to be able to complete this technology license for VAL401 with Ambrose and we have been working to identify multiple funding partners to progress VAL401 through the various clinical stages with several options under discussion,” said Mark Eccleston, CEO of ValiRx.
“In addition, we are also exploring short term opportunities to support a funded preclinical validation for VAL401 through our wholly owned subsidiary, Inaphaea Biolabs Limited, which has 19 pancreatic Patient Derived Cell models. These models can be applied in 3D systems as New Approach Methods which are receiving growing support from the FDA in support for IND submissions.”
Ambrose Healthcare will assume all future patent costs and committed to completing the development and commercialisation of VAL401 at its own expense.
The deal is a major validation of ValiRx’s model and investors will hope it marks a turning point for shares that have been under considerable pressure.