Through this agreement, Plethora will receive up to $28 million in cash with $15 million payable upon signature and a further $10 million upon first commercial sale of PSD502 (Plethora’s development stage product for the treatment of premature ejaculation) in the US, subject to certain conditions. In return, Paul Capital Healthcare will receive an interest in the revenues generated from Plethora’s male health portfolio.
In addition, under certain pre-agreed conditions, Plethora will have the option to have Paul Capital Healthcare invest an amount of $3 million by way of equity subscription in 2008. The initial payment of $15 million will provide working capital to underwrite ongoing Phase III programs in premature ejaculation and erectile dysfunction as well as strengthening the Plethora balance sheet to facilitate potential product and corporate transactions.
The revenue interest will be paid by Plethora primarily on revenues derived from sales of ErecAid, PSD502 and PSD510. Future revenues from the remainder of the existing Plethora portfolio for the treatment of female urological disorders are not covered under this agreement.
Steven Powell, CEO of Plethora, said: “This agreement provides us with financial resources to help fulfill our ambitions for the growth of Plethora. We also expect that this transaction will maximize value realization from our male health portfolio, including our Timm Medical operation.”