Theratechnologies has closed its transaction related to the collaboration and licensing agreement with EMD Serono, Inc, an affiliate of Merck KGaA, Darmstadt Germany. As part of this transaction, Theratechnologies has received an upfront payment of US$30 million (CDN$37.0 million) which includes a license fee of US$22 million (CDN$27.1 million) from EMD Serono and an equity investment of US$8 million (CDN$9.9 million) in Theratechnologies common stock at a price of US$3.67 (CDN$4.52) per share by Merck KGaA.

Under the terms of the agreement, Theratechnologies may receive up to US$215 million (CDN$264.8 million) including the upfront payment, and payments based on the achievement of certain development, regulatory and sales milestones. Theratechnologies will also be entitled to receive increasing royalties on annual net sales of tesamorelin in the US.

"The closing of this transaction solidifies our financial situation to a very comfortable position," commented Luc Tanguay, senior executive vice-president and CFO of Theratechnologies. "The upfront payment received today together with the future milestone and royalty payments provide us with a fully-financed business plan through the commercialization of tesamorelin for its first indication in the US," concluded Tanguay.

"We are delighted to announce the closing of the transaction with EMD Serono," said Yves Rosconi, president and CEO of Theratechnologies. "We look forward to a successful and productive relationship with EMD Serono. The company has a major presence in the area of HIV-associated disorders and growth hormone, which in combination with its strong track record of successfully commercializing new drugs, makes EMD Serono an excellent strategic partner to bring the value of tesamorelin to patients in need," commented Yves Rosconi.

Theratechnologies is a Canadian biopharmaceutical company that discovers innovative drug candidates in order to develop them and bring them to market.