Nuvo Pharmaceuticals Inc. (Nuvo), a commercial healthcare company with a portfolio of commercial products and pharmaceutical manufacturing capabilities, announced that its wholly owned subsidiary, Nuvo Pharmaceuticals (Ireland) Limited (Nuvo Ireland) has acquired the US rights to Resultz (50% isopropyl myristate, 50% cyclomethicone D5 topical solution lice and egg removal kit) from Piedmont Pharmaceuticals LLC (Piedmont). The acquisition includes all US product and intellectual property rights and is a complementary follow-on to Nuvo's acquisition of the global, ex-US Resultz product rights announced on January 2, 2018. Nuvo now owns all Resultz product and intellectual property rights throughout the world.
Resultz is a commercial-stage, best-in-class, clinically proven, safe, non-pesticide, over-the-counter (OTC) treatment for head lice. Resultz was cleared as a Class 1 medical device by the US Food and Drug Administration (FDA) in May 2017 and has not yet been commercially launched in the US. The topical head lice market in the US was valued at US$255 million in 2016, inclusive of both prescription and OTC products. Resultz, with its class-leading 5-minute application time, is well positioned to enter this attractive market. Nuvo anticipates commercializing Resultz in the US through a licensing partner and has already initiated discussions with potential licensees. With this transaction, Nuvo gains global control of the Resultz franchise and adds an additional FDA cleared US product to its growing commercial product portfolio. Alongside existing manufacturing partners, Nuvo will be able to produce Resultz for the US market at its Varennes, Québec manufacturing facility.
"We are thrilled to complete full ownership of the global Resultz business through the acquisition of the US rights for Resultz," said Jesse Ledger, Nuvo's President & CEO. "We believe the product attributes that have made Resultz a market leader in Canada and Europe, where market capture rates have reached as high as 35%, namely the class-leading 5-minute application time, up to 100% efficacy and exceptional safety profile as a non-pesticide treatment, will make it a success in the United States as well. Additionally, the team at Nuvo has been working hard for more than a year, with discipline and clear criteria for strong acquisition and in-licensing opportunities, and we are pleased to have been able to deliver on several recent transactions as a result, including the two Resultz transactions and international Pennsaid 2% licensing transactions. We continue to review and pursue multiple opportunities with that same focus and discipline."
Under the terms of the agreement, US$1.5 million was paid to Piedmont on close using existing cash on hand. The transaction includes a single-digit royalty payable by Nuvo Ireland on net sales through 2034. Nuvo, through its Nuvo Ireland subsidiary, has also obtained a right of first refusal to license or acquire certain related assets from Piedmont targeting other human indications. Nuvo now has cash and short-term investments of approximately $8.3 million and no debt with an unused $6.0 million line of credit, which positions Nuvo to acquire additional products and businesses from existing resources.
Stifel, Nicolaus & Company, Incorporated acted as exclusive financial advisor to Piedmont Pharmaceuticals LLC in this transaction.
Resultz is a pesticide-free pediculicide rinse which was originally developed by Piedmont that addresses the challenge of increasing pesticide resistance in lice and concerns about patient safety through exposure to pesticides. In as little as a 5-minute application (the shortest treatment application time for head lice products), Resultz acts to disrupt the wax covering of the head louse resulting in their dehydration and death. Resultz lice and egg removal kit facilitates removal of lice, nymphs and nits with efficacy of up to 100 % in as little as 5 minutes. If necessary, a second application approximately 7-10 days later will eliminate any remaining lice. The Resultz lice and egg removal kit and its unique physical mechanism of action allows Resultz to work even with pesticide resistant super lice. Resultz is indicated for treating both children and adults. It has an excellent safety profile and contains active ingredients commonly found in many cosmetic products. Resultz was first launched as a medical device in the United Kingdom and Ireland in 2005 and more than ten million patients have been treated globally to-date. Current global licensees include Reckitt Benckiser Group PLC, Aralez Pharmaceuticals Inc. and Lapidot Medical. Resultz is also pending registration in Japan, where the local license is held by Sato Pharmaceutical Co. Ltd. Resultz is protected by a robust portfolio of 40 issued patents globally, including two US patents which provide protection through to 2022 and 2024, respectively.