Item 1.01. Entry into a Material Definitive Agreement.
On June 19, 2024, Alimera Sciences, Inc. (the "Company") entered into a letter agreement (the "Letter Agreement") with SWK Funding LLC ("SWK") updating certain terms of the Company's existing New Collaboration Agreement (as defined below) and associated royalty payments.
In February 2005, the Company entered into an agreement with EyePoint Pharmaceuticals US, Inc. ("EyePoint") for the use of fluocinolone acetonide ("FAc") in EyePoint's proprietary insert technology for the treatment of all ocular diseases in humans other than uveitis. This agreement was subsequently amended several times (as amended, the "EyePoint Agreement"), providing the Company with a worldwide exclusive license to utilize certain underlying technology used in the development and commercialization of ILUVIEN®. The EyePoint Agreement was then amended and restated in July 2017 (the "New Collaboration Agreement"). The New Collaboration Agreement expanded the license to include uveitis, including NIU-PS, in Europe, the Middle East and Africa and also allowed the Company to pursue an indication for NIU-PS for ILUVIEN in those territories. In accordance with the New Collaboration Agreement, the Company agreed to pay a 6% royalty on net revenues of ILUVIEN and other related consideration to EyePoint and paid an additional 2% royalty on global net revenues and other related consideration in excess of $75.0 million in any year. Furthermore, the New Collaboration Agreement included a right to offset $15.0 million of future royalty payments (the "Future Offset"), which reduces royalties that would otherwise be owed to EyePoint from 6% to 5.2% for net revenues of ILUVIEN and other related consideration up to $75.0 million annually and from 8% to 6.8% for net revenues of ILUVIEN and other related consideration in excess of $75.0 million on an annual basis until the Future Offset is recovered. As of March 31, 2024, the remaining value of the Future Offset was approximately $6.4 million.
On December 17, 2020, EyePoint entered into a royalty purchase agreement (the "SWK Agreement"), pursuant to which EyePoint sold its interest in royalties that the Company is obligated to pay EyePoint under the New Collaboration Agreement to SWK. The Company is not a party to the SWK Agreement.
The Letter Agreement modifies the royalty payment that the Company is obligated to pay SWK to 3.125% on net revenues (the "Alternative Royalty") for any FAc product, including YUTIQ® and ILUVIEN. In addition, pursuant to the terms of the Letter Agreement, in the case of a Change of Control (as defined in the Letter Agreement), the Company may, at its option, at any time during the six (6) months following the effective date of such Change of Control buy out the entire royalty obligation for the greater of (a) $17,250,000 and (b) 4.75 times the aggregate amount of Alternative Royalty paid or payable (x) over the most recently completed four (4) calendar quarters, or (y) if such Option is exercised prior to April 1, 2025, then 3.125% of net revenues for any FAc product over the most recently completed four (4) calendar quarters.
A copy of the Letter Agreement will be filed as an exhibit to the Company's Form 10-Q for the quarter ending June 30, 2024. The foregoing description of the terms of the Letter Agreement is qualified in its entirety by reference to the full text of such exhibit.
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Alimera Sciences Inc. published this content on 24 June 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 June 2024 11:32:39 UTC.