PureTech Health sells interest in KarXT to Royalty Pharma for up to $500M

PureTech Health (PRTC) and Royalty Pharma (RPRX) announced that Royalty Pharma has acquired an interest in PureTech’s royalty in Karuna Therapeutics’ KarXT for up to $500M, with $100M in cash up front and up to $400M in additional payments contingent on the achievement of certain regulatory and commercial milestones. As part of this transaction, PureTech has sold its right to receive a 3% royalty from Karuna to Royalty Pharma on sales up to $2 billion annually, after which threshold Royalty Pharma will receive 33% and PureTech will retain 67% of the royalty payments. PureTech retains its 3.1% equity ownership in Karuna.1 Additionally, under its license agreement with Karuna, PureTech retains the right to receive milestone payments upon the achievement of certain regulatory approvals and 20% of sublicense income.