REGENXBIO Strikes Deals for $250 Million Royalty Monetization and Future Growth

REGENXBIO Secures Up to $250 Million Through Royalty Monetization Agreement

REGENXBIO Inc. (Nasdaq: RGNX), a prominent player in the biotechnology sector, has successfully closed a noteworthy limited recourse royalty bond agreement with Healthcare Royalty (HCRx), totaling up to $250 million. This innovative financial arrangement is designed to optimize the company's cash inflows while targeting future milestones in gene therapy development.

The agreement allows REGENXBIO to monetize selected royalties and milestones, granting immediate access to significant non-dilutive capital. At the moment of closure, REGENXBIO received an initial $150 million, enhancing its cash runway and ensuring sustainability into early 2027. This capital will facilitate ongoing operations and further advancements in several pivotal clinical projects.

Mitchell Chan, CFO of REGENXBIO, stated, "This strategic financing brings future potential funds forward and extends our runway well into the timelines of several critical milestones, such as the anticipated FDA approval for RGX-121 targeting MPS II, the upcoming data readouts for RGX-202 for Duchenne Muscular Dystrophy, and the studies related to ABBV-RGX-314 for wet AMD. These workflows are instrumental as we push towards launching first- or best-in-class products."

The royalty bond aligns with REGENXBIO's strategy to utilize low-cost, non-dilutive funding sources to not only extend its operational scope but also to advance its unique portfolio of gene therapy solutions. These innovations have the potential to transform treatment processes for various rare and retinal diseases, thus significantly impacting patient care and leading to substantial patient outcomes.

Agreement Terms and Future Potential

Under the outlined terms of the agreement, HCRx will provide REGENXBIO with up to a $250 million bond against anticipated royalty payments from ZOLGENSMA®, a gene therapy aimed at treating Spinal Muscular Atrophy (SMA), along with other gene therapy developments tied to RGX-121 and RGX-111 in collaboration with Nippon Shinyaku. The bond agreement is structured such that quarterly interest payments will stem from the revenue generated by these royalties.

In addition to fronting $150 million at closing, REGENXBIO can expect further funding of $50 million by April 2027, contingent on reaching certain milestones related to ZOLGENSMA sales. Should both parties reach mutual agreements, an additional $50 million may also be provided, further extending REGENXBIO's operating horizon.

Significantly, this agreement allows REGENXBIO to maintain ownership of other potential non-dilutive funding sources, such as the anticipated sale of a Priority Review Voucher associated with RGX-121, other milestones from AbbVie, and key developmental benchmarks with Nippon Shinyaku. The company aims to maximize the potential of these assets while minimizing dilution for current shareholders.

As of now, ZOLGENSMA, known for its intravenous delivery method, has secured approval for the treatment of SMA across over 50 nations. Recently, Novartis unveiled that its Phase III study for ZOLGENSMA, maneuvering through an intrathecal approach, has met its primary endpoint, showcasing the promising trajectory of the product.

Impact on Gene Therapy and Beyond

REGENXBIO stands at the forefront of gene therapy innovation, with a pipeline that boasts treatments for critical conditions such as Duchenne Muscular Dystrophy and multiple types of MPS. Their mission is to leverage gene therapy's curative potential to reshape healthcare delivery standards worldwide

Since 2009, REGENXBIO has established itself as a pioneer in AAV gene therapy, having helped thousands of patients through its advanced gene therapy treatments. As the company prepares for potential product launches and scaling up commercial readiness, this recent financing strategy positions it to accelerate the development and delivery of its groundbreaking therapies to those in need.

Moving forward, REGENXBIO’s approach underscores the importance of innovative funding strategies in biotechnology, as effective capital management can facilitate the rapid advancement of vital therapies while ensuring that the needs of shareholders are also considered. This agreement not only enhances REGENXBIO's financial positioning but also confirms its commitment to pioneering advancements in biotechnology and gene therapy, ultimately improving lives around the globe.