Aytu BioPharma pays $3,000,000 upfront for U.S. rights to depression drug EXXUA

Aytu BioPharma, Inc. (Nasdaq: AYTU) entered into an Exclusive Commercialization Agreement with Fabre-Kramer Holdings, Inc. on June 5, 2025, the company reported in a Form 8-K filed the next day under Item 1.01. Under the agreement, Aytu acquired certain rights and obligations to commercialize EXXUA (gepirone) extended release tablets in the United States, its commonwealths, territories and possessions. The company is based in Denver, Colorado.

The product and the company's claims

EXXUA is an FDA-approved treatment for major depressive disorder in adults. The 8-K calls it a first-in-class treatment with a novel mechanism of action and a differentiated clinical profile. It says the drug has been studied in over 5,000 patients. The filing does not describe the results of those studies or their size, and it does not say how the drug compares with existing treatments on efficacy.

Aytu expects to launch EXXUA in the fourth calendar quarter of 2025 through its commercial team. The 8-K puts the United States prescription market for MDD at over $22 billion and says over 21 million Americans are affected by the disorder. It cites over 340 million antidepressant prescriptions written in 2024 and says significant unmet needs remain given the unacceptable side effects of current therapeutics. Those are the company's own characterizations, and the filing gives no study or outside source for them.

The payments

Aytu made an upfront cash payment of $3,000,000 to Fabre-Kramer on the effective date. It agreed to pay a second $3,000,000 within 45 days of the first anniversary of the first physical sale of the product through a bona fide, arm's-length transaction that moves the product into the commercial channel. That payment rises to $5,000,000 if first-year net sales meet or exceed $35 million.

Sales milestones range from $5,000,000 to over $100,000,000 per year, paid once net sales pass a threshold of $100,000,000. Aytu will also pay 10% of net sales above $1 billion.

Royalties start at 28% of net sales and rise to 39% if net sales exceed $300 million in any year, until a reduced royalty trigger is reached. After that trigger, the royalty is 24.5%, rising to 35.5% if net sales exceed $300 million in a year. Aytu will also pay a supply price of 3% of net sales less its cost of goods sold, rising to 4% of net sales when annual net sales exceed $300 million.

The only fixed cash cost in the filing is the $3,000,000 upfront. Every later payment is tied to the product's sales, milestones or royalties, so the cost of the deal rises with the product's success.

Termination and what is missing

Either party can end the agreement by mutual consent. Either can also end it for a material breach not cured within 90 days, or within a period of no more than 120 days where a breach cannot be cured in 90 days. Either party may terminate on written notice if the product is withdrawn for safety reasons, if the FDA materially restricts its indications, or if federal or state pricing controls would cause obvious or substantial loss of sales.

The 8-K says the full agreement will be filed as an exhibit to the annual report for the year ending June 30, 2025, with confidential portions redacted. Until then, the terms described are a summary, and the filing says it does not purport to be complete. The 8-K does not explain how Aytu will fund the $3,000,000 upfront, and it names no bank or adviser on the deal.

The announcement press release is attached as Exhibit 99.1, which the 8-K says is not deemed filed for Exchange Act purposes. The 8-K is signed by Chief Financial Officer Ryan J. Selhorn.

The economics depend on a launch planned for the fourth quarter of 2025 and on net sales reaching the thresholds in the filing, $35 million for the higher second payment and $300 million for the higher royalty tier.

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