Blog Coverage RedHill Biopharma Signs Co-Promotion Agreement with Concordia and Announces Exercise of Underwriters Options

LONDON, UK / ACCESSWIRE / January 4, 2017 / Active Wall St. blog coverage looks at the headline from specialty biopharmaceutical company RedHill Biopharma Ltd (NASDAQ: RDHL) announced on January 03, 2017, that it has signed an exclusive co-promotion agreement with a subsidiary of Concordia International Corp. (NASDAQ: CXRX). This agreement grants RedHill US promotion rights for Donnatal®, a prescription oral drug used with other drugs in the treatment of irritable bowel syndrome (irritable colon, spastic colon, mucous colitis) and acute enterocolitis (inflammation of the small bowel). Register with us now for your free membership and blog access at: http://www.activewallst.com/register/.

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Terms of Agreement

Under the terms of the agreement, RedHill will be responsible for certain promotional activities related to Donnatal®. Concordia will continue to be responsible for the manufacturing and supply of Donnatal® in all territories. Donnatal® accounted for 7.7% of Concordia’s consolidated revenues in H1 2016. RedHill and Concordia will share the revenues generated from the promotion of Donnatal® by RedHill based on an agreed upon split between them. The initial term of the co-promotion agreement with Concordia is for three years. RedHill expects to initiate gradual promotion of Donnatal® in the coming months.

Dror Ben-Asher, Chief Executive Officer of RedHill, said:

“We are pleased to partner with Concordia for the US promotion of Donnatal®, a trusted brand among physicians for symptoms of IBS and acute enterocolitis. With a core US commercial team in place, we plan to initiate promotional activities in the US in the coming months with a specialty gastrointestinal sales force.”

About the Drug

Donnatal is a prescription drug, is classified as possibly effective as an adjunctive therapy in the treatment of irritable bowel syndrome and acute enterocolitis. Donnatal® slows the natural movements of the gut by relaxing the muscles in the stomach and intestines and acts on the brain to produce a calming effect. IBS is one of the most common gastrointestinal disorders. In the official press release, the Company estimated that at least 30 million Americans suffer from IBS. The US potential market for IBS treatments is estimated to exceed $2.3 billion by 2027. Studies estimate that IBS affects 10% to 15% of US adults, with about twice as many women as men and most often occurs in people younger than age 45.

Exercise of Underwriters Options

On the same day of the collaboration agreement, RedHill announced that the underwriters of its previously announced underwritten public offering of 2,250,000 American Depository Shares, each representing 10 of its ordinary shares, and warrants to purchase 1,125,000 ADSs, have partially exercised their option and purchased 133,104 ADSs.

Pursuant to the partial exercise of the underwriters’ option, RedHill’s underwritten public offering and the concurrent registered direct offering totaled 3,846,519 ADSs and warrants to Purchase 2,025,458 ADSs, representing aggregate gross proceeds from both offerings combined of approximately $39.4 million before deducting underwriting discounts and commissions, placement agent fees and other offering expenses.

Stock Performance

At the close of trading session on January 03, 2017, RedHill Biopharma’s stock price slightly declined 0.57% to end the day at $10.40. A total volume of 126.85 thousand shares were exchanged during the session, which was above the 3-month average volume of 56.45 thousand shares. The stock currently has a market cap of $1.33 billion.

Concordia International’s stock price climbed 7.55% from its previous closing price of $2.12 to close the day at $2.28. A total volume of 2.49 million shares were exchanged during the session, which was above the 3-month average volume of 2.17 million shares. The stock currently has a market cap of $116.32 million.

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