Pulmatrix unveils pact with Cipla Technologies for co-development of asthma treatment Pulmazole

Investors took profits from Pulmatrix Inc (NASDAQ:PULM) in Tuesday’s pre-market session a day after the biopharma company’s stock soared, thanks to its pact with Cipla Technologies for the co-development and commercialization of its asthma treatment Pulmazole (PUR1900).

Under the terms of the agreement, Cipla will pay $22 million to Pulmatrix upfront in exchange for all rights to Pulmazole, which specifically treats allergic bronchopulmonary aspergillosis (ABPA) in patients with asthma. But once the deal closes, Pulmatrix will hold onto the right to receive 50% of the free cash flow from future sales of Pulmazole.

READ: Hemispherx Biopharma makes headway in advancing flagship cancer drug Ampligen in 2018

On top of this, Pulmatrix will still take responsibility for the clinical development of Pulmazole while Cipla will primarily oversee the commercialization of the product.

Investors sent Pulmatrix shares down 13% to $2.01 before the opening bell Tuesday after sending them rocketing by 82% to finish at $2.31 on Monday.

Thanks to the investment, Pulmatrix expects it will be in a position to finish a Phase 2 study evaluating Pulmazole, which is set to kick off in the second quarter.  

ABPA is a disease that occurs frequently in patients with asthma or cystic fibrosis, and it is characterized by an allergic reaction to the fungus aspergillus colonizing and growing in the airways. 

Headquartered in Lexington, Massachusetts, Pulmatrix is a clinical-stage biopharmaceutical company developing inhaled therapies to treat serious pulmonary disease using its patented iSPERSE technology. 

Cipla, meanwhile, is a global pharmaceutical company with operations in India, South Africa and North America.

Contact Ellen Kelleher at [email protected]

Story by ProactiveInvestors