Moleculin Announces Out-Licensing Deal to Accelerate Preclinical & Clinical Development

Moleculin Biotech, Inc., a clinical-stage pharmaceutical company focused on the development of oncology drug candidates, all of which are based on license agreements with The University of Texas System on behalf of the M.D. Anderson Cancer Center, recently announced it has entered into a sub-license agreement with WPD Pharmaceuticals (WPD), located in Poland.

The agreement provides WPD with exclusive rights, subject to current license agreements, to develop and market a range of Moleculin’s technologies in certain European countries (which does not include the UK, France, Italy, and Spain) in exchange for contributing a minimum of $4 million in development expenditures agreed upon by Moleculin during the term of the agreement plus an ongoing royalty on future revenues. The agreement is specifically geared to provide Moleculin with the benefit of European Union (EU) grant funding, which is available to companies like WPD that are formed and present in EU countries.

The company has previously entered into similar agreements with Dermin s.p. z.o.o. with some of its technologies in similar territories and Dermin has succeeded in obtaining grant funding in Poland benefiting the company’s development objectives.

“Prior to being a public company, our portfolio benefited from funding obtained by Dermin in the past allowing us to accelerate our lead drug development in exchange for the rights to selected territories,” said Walter Klemp, Moleculin’s Chairman and CEO. “So, we already have a strong track record of pursuing and utilizing EU funding sources.  Since our Scientific Founder, Dr. Waldemar Priebe has a major interest in both Moleculin and WPD, we believe we have an even better alignment of priorities allowing both companies to work together for our mutual benefit with this new agreement going forward.”

Mr. Klemp added “We view this as a potential source of non-dilutive financing that we believe greatly benefits Moleculin shareholders. We estimate that the territories we are out-licensing represent approximately 10% of the worldwide spending on healthcare (as reported by the World Health Organization), and exclude key markets considered important to potential future out-licensing opportunities with Big Pharma, so we believe the opportunity to access $4 million and potentially significantly more in spending toward our development objectives, without dilution to shareholders, is a good deal for Moleculin. We believe this deal may allow us to pursue new indications for our lead drugs that otherwise would remain unexplored, which may ultimately increase our market opportunities and our chances for earlier drug approval. An added and extremely important benefit of this approach is that Moleculin doesn’t have to invest its own resources in establishing an EU-based infrastructure that would be required to access such grant funding of our own. We believe this deal continues our low overhead, capital efficient approach.”

Roth Capital Partners rendered a fairness opinion to the company’s board of directors in connection with the transaction with WPD.

Moleculin Biotech, Inc. is a clinical-stage pharmaceutical company focused on the development of oncology drug candidates, all of which are based on discoveries made at M.D. Anderson Cancer Center. The company’s clinical-stage drugs are Annamycin, an anthracycline designed to avoid multidrug resistance mechanisms with little to no cardiotoxicity being studied for the treatment of relapsed or refractory acute myeloid leukemia, more commonly referred to as AML, and WP1066, an immuno-stimulating STAT3 inhibitor targeting brain tumors, pancreatic cancer and AML. Moleculin Biotech is also engaged in preclinical development of additional drug candidates, including additional STAT3 inhibitors and compounds targeting the metabolism of tumors. For more information, visit http://www.moleculin.com.