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DRI Capital acquires royalty interest in cancer drug for $150 mln

MRC Technology has sold a portion of its royalty interest in a cancer drug to Canadian private equity firm DRI Capital for US$150 million. The drug, pembrolizumab, is being marketed by Merck & Co Inc as Keytruda. It is a new treatment that stimulates the body’s immune system to fight cancer. Scientists at MRC, a British medical research charity, have supported development of the drug, which has been approved by U.S. regulators for treating advanced melanoma and non-small cell lung cancer. Toronto-based DRI made the investment via its third healthcare royalty fund, Drug Royalty III, which raised US$1.45 billion in late 2013.

PRESS RELEASE

MRC Technology monetises royalties on cancer drug Keytruda® (pembrolizumab) to expand medical research activities, with a fund managed by DRI Capital

MRC Technology, a UK-based medical research charity, has monetised a portion of its royalty interest in a leading cancer drug, pembrolizumab (marketed by Merck & Co., Inc. as Keytruda®) with a private equity fund managed by DRI Capital (DRI) for US $150M (£115.6M). Pembrolizumab is a new generation treatment which stimulates the body’s immune system to fight cancer. Scientists at MRC Technology humanised the antibody-based treatment, which has been approved in the United States for treating advanced melanoma and non-small cell lung cancer, with breakthrough designations under FDA’s accelerated approval pathway awarded for colorectal cancer and classical Hodgkin Lymphoma. A number of trials in other cancers are showing promising results.

Dr Dave Tapolczay, Chief Executive, MRC Technology said: “Keytruda is already transforming the lives of thousands of patients and its legacy is now enabling MRC Technology to magnify our impact in finding new treatments. The charity focuses on areas where there are unmet patient needs and being self-funded means we rely on royalty income to advance further medical breakthroughs. The monetisation allows us to expand our philanthropic activities and invest in research areas others aren’t able to pursue.”

“We are pleased that our fund Drug Royalty III has acquired a portion of MRC Technology’s royalty entitlement on the worldwide sales of Keytruda, an important new cancer drug,” said Behzad Khosrowshahi, President & Chief Executive Officer of DRI. “DRI has been a global leader in working creatively with royalty recipients, including charitable organisations, academic institutions and companies. This important deal with the team at MRC Technology, who we have known for many years, further reinforces that.”

MRC Technology is revising its strategic plan and will continue to consult with key partners, including the Medical Research Council, academia, other charities and the pharmaceutical industry. It will now also be able to pursue exciting novel research and development collaborations with new partners. The charity is already in the process of expanding its diagnostics capability in Edinburgh and has increased the work it does with UK and international charities to bring innovative research closer to patients. Earlier this year (April 2016) MRC Technology relocated its laboratory and some employees from the London office to state-of-the-art facilities in Stevenage.

MRC Technology received financial advice on the royalty buy-out from MTS Health Partners and legal advice from Covington & Burling LLP. Drug Royalty III was advised on legal matters by Hogan Lovells.

Further information

Media enquiries: Liezel Tipper, PR & Communications Manager, MRC Technology. Tel: +44 (0)20 7391 2772, Email: Liezel.Tipper@tech.mrc.ac.uk

About MRC Technology

MRC Technology is an independent life science medical research charity committed to improving positive patient outcomes everywhere.

As a champion for human health, MRC Technology partners with academic, biotechnology, pharmaceutical and charity organisations to move promising medical research forward into viable and accessible patient treatments.

As a self-funded charity, income is reinvested to support translating research from the bench to patient. MRC Technology offers commercialisation and IP management skills and diagnostic and drug discovery expertise, specialising in small molecules and therapeutic antibodies.

MRC Technology projects have led to several approved drugs, changing the lives of countless patients by harnessing the potential of science. www.mrctechnology.org.

About DRI Capital

DRI is a pioneer and global leader in healthcare royalty investing and has completed more than 60 transactions with large global pharmaceutical companies, biotechnology companies, universities, research institutes, academic hospitals, and individual inventors located around the world. Earlier in 2016, DRI announced the purchase of royalties on Johnson & Johnson’s Zytiga from another leading U.K. research institution, The Institute of Cancer Research. For more information on DRI, please visit www.dricapital.com or contact M. Craig Shepherd, Managing Director (cs@dricapital.com; 416.324.5716).

About Keytruda

Keytruda has been approved by the US Food and Drug Administration (FDA), European Commission, the National Institute for Health and Care Excellence and Australia’s Therapeutic Goods Administration for the treatment of advanced melanoma. The FDA also approved Keytruda for the treatment of non-small cell lung cancer.

Breakthrough designations were awarded by the FDA for colorectal cancer and classical Hodgkin Lymphoma, while the European Medicines Agency has adopted a positive opinion recommending approval of Keytruda for the treatment of locally advanced or metastatic non-small cell lung cancer.

Photo courtesy of Reuters/Jeff Zelevansky