Pelthos Therapeutics acquires Xepi Cream from Biofrontera, Ferrer

Pelthos Therapeutics (PTHS) has acquired the U.S. commercialization rights to XepiCream, 1%, from Biofrontera Inc. (BFRI) and Ferrer Internacional. Xepi is a non-fluorinated quinolone antimicrobial indicated for the topical treatment of impetigo due to Staphylococcus aureus or Streptococcus pyogenes in adult and pediatric patients two months of age and older. The Company has also closed on an $18M private convertible notes financing with existing investors, including Ligand Pharmaceuticals (LGND) and a group of investors led by Murchinson. Under the terms of the Acquisition agreement, Pelthos will pay Biofrontera $3M and Ferrer $1.2M upfront, with additional payments based on the availability of commercial quantities of Xepi and the achievement of sales-based milestones. Pelthos will pay royalties on U.S. net sales of Xepi to Ferrer and the Investors. Xepi was developed by Ferrer and Medimetriks Pharmaceuticals, Inc., and approved by the FDA in 2017. At the time of approval, Xepi was the first new novel treatment for impetigo in more than 10 years. Biofrontera has owned the U.S. rights to Xepi since 2019 but has not been actively promoting the product. Pelthos intends to re-launch Xepi in late 2026. Pelthos has also closed on an $18M convertible notes financing with the Investors. The Notes will be secured obligations of Pelthos and will bear interest at a rate of 8.5% per annum, payable quarterly in arrears. The Notes will mature on November 6, 2027, unless earlier repurchased, redeemed or converted into shares of Pelthos common stock in accordance with their terms. The Notes will be convertible at an initial conversion price of $34.442, representing the price that is the lower of the Official Closing Price immediately preceding the signing of the binding agreement or the average Official Closing Price for the five trading days immediately preceding the signing of the binding agreement. The Company anticipates that the proceeds of the financing will be used to acquire and relaunch Xepi, accelerate the commercialization of ZELSUVMI, and for general working capital purposes. In addition to the Notes, the Investors will be entitled to a low single-digit royalty on U.S. net sales of Xepi and additional milestone payments and royalties on ZELSUVMI net sales in Japan, if ZELSUVMI is approved in Japan.