07:51 AM EDT, 07/02/2024 (MT Newswires) -- HLS Therapeutics ( HLTRF ) sold its royalty interest and milestone payment obligations in the global sales of Xenpozyme (olipudase alfa) to DRI Healthcare Trust (DHT-UN.TO, DHT-U.TO), for US$45.75 million.

The deal includes a US$13.25 million upfront payment and up to US$32.5 million in performance-based outbound milestone payments.

HLS will use upfront proceeds from the sale to reduce its term loan. The repayment is expected to cut annual interest expense by more than $1.3 million. HLS is also lowering its 2024 royalty revenue guidance to between $1.5 to $1.7 million from the previous $3 to $4 million.

The transaction entitles DRI to a 1% royalty on worldwide sales of Xenpozyme. The Trust will receive up to US$6.3 million in royalty receipts per calendar year, with a 50% step down for all royalty receipts above that amount. DRI first acquired a royalty interest in Xenpozyme for US$30 million in November 2022.

Xenpozyme is the only product developed and approved for the treatment of non-central nervous system manifestations of acid sphingomyelinase deficiency (ASMD), also known as Niemann-Pick disease, in pediatric and adult patients. It has been approved in Japan, Europe and the U.S.