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ARS Pharmaceuticals, Inc. (NASDAQ:SPRY), a pharmaceutical company specializing in drug preparations with a market capitalization of $1.39 billion and impressive gross profit margins of 77%, announced today that it has entered into a co-promotion agreement with ALK-Abelló, Inc. According to InvestingPro analysis, SPRY is currently trading above its Fair Value, suggesting investors should carefully consider entry points. The partnership, effective May 2, 2025, focuses on the co-promotion of ARS’s epinephrine nasal spray, Neffy®, to pediatricians and other prescribers across the United States.
Under the terms of the agreement, ALK is granted a non-exclusive, royalty-free license to promote Neffy using ARS’s trademarks and copyrights. ALK’s promotion activities are set to begin immediately, with specific performance milestones and minimum detailing requirements to be met by their qualified sales representatives. InvestingPro data shows the company maintains strong financial health with an exceptional current ratio of 14.26, indicating robust ability to meet short-term obligations. Additionally, for 180 days following the term of the agreement, ALK is prohibited from marketing, selling, or manufacturing any competing epinephrine injection products in the U.S.
ARS will remain responsible for all commercialization activities related to Neffy in the U.S., including marketing, medical affairs, market access, production, distribution, and safety. The company will also handle all U.S. sales of Neffy.
The financial structure of the partnership includes a base fee paid by ARS to ALK for promotion services, with the first year’s payments deferred to the second year. ALK will also be eligible for performance-based bonuses starting in the second year, based on exceeding certain market share thresholds.
The co-promotion agreement is set to expire on the fourth anniversary of the commencement of ALK’s promotional activities. Either party can terminate the agreement in the event of an uncured material breach or a change of control. Specific provisions allow for early termination under certain conditions, such as failure to meet ramp-up timelines or minimum detailing requirements.
In the event of termination for convenience by ARS, the company may be required to pay ALK a percentage of Neffy’s net sales generated from ALK-targeted prescribers over a specified market share threshold. Termination in connection with a change of control of ARS would result in a one-time termination fee payable to ALK.
This partnership follows a previous Collaboration, License, and Distribution Agreement between ARS and ALK-Abelló A/S, an affiliate of ALK, which ARS has the right to terminate if ALK commercializes or manufactures a non-injectable epinephrine product in the U.S. However, ARS has waived this right in accordance with the new co-promotion agreement for Neffy. The company has demonstrated strong market performance with a 34% year-to-date return. For deeper insights into SPRY’s financial health and growth potential, including 10+ additional ProTips and comprehensive analysis, explore the full research report available on InvestingPro.
The information is based on a press release statement filed with the SEC.
In other recent news, ARS Pharmaceuticals Inc. reported its fourth-quarter 2024 earnings, significantly surpassing analyst expectations with an earnings per share (EPS) of $0.51 compared to a forecasted loss of $0.13. The company achieved a total revenue of $86.6 million, well above the anticipated $5.1 million, driven by strong collaboration and product revenues. Raymond (NSE:RYMD) James analyst Ryan Deschner has reaffirmed a Strong Buy rating on ARS Pharmaceuticals, raising the price target to $32 from the previous $28, reflecting confidence in the company’s recent earnings and strategic moves. The analyst noted the company’s accelerated timeline for achieving over 80% commercial access to its products by July 1, 2025, ahead of the initial target. Recent meetings with ARS Pharmaceuticals’ management have reinforced Raymond James’ optimistic outlook, highlighting the company’s efforts in expanding market reach and strategic partnerships. Additionally, ARS Pharmaceuticals’ management reported progress in patient access to their product, neffy, with a new agreement with United Health Care providing unrestricted access starting April 1. These developments are seen as pivotal in strengthening ARS Pharmaceuticals’ market position as it approaches the revised date for expanded commercial access.
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