DRRX Durect Corp

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 8-K

Current Report

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

November 22, 2024

Date of Report

(Date of earliest event reported)

DURECT CORPORATION

(Exact name of Registrant as specified in its charter)

Delaware		000-31615		94-3297098
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

10240 Bubb Road

Cupertino, CA 95014

(Address of principal executive offices) (Zip code)

(408) 777-1417

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Stock $0.0001 par value per share	DRRX	The NASDAQ Stock Market LLC (The Nasdaq Capital Market)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

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Item 1.01. Entry into a Material Definitive Agreement.

On November 22, 2024 (the “Closing Date”), DURECT Corporation (the “Company”) entered into an Asset Purchase Agreement (the “APA”) with Alzet, LLC, a subsidiary of Lafayette Instrument Co. (the “Purchaser”). Under the terms of the APA, the Company agreed to sell to the Purchaser substantially all the assets, and certain specified liabilities, related to the ALZET product line (the “Sale”). The APA provided for, subject to certain terms and conditions, the entry into a Transition Services Agreement, pursuant to which the Company agrees to perform certain transition services related to the purchased assets for up to six months after Closing Date, subject to potential extensions.

On the Closing Date, the Company completed the transaction contemplated by the APA. Pursuant to the terms of the APA, the Purchaser paid the Company $17,500,000 subject to certain adjustments, including for net working capital.

Simultaneous with this transaction, the Company has paid off all remaining obligations under the term loan agreement with Oxford Finance LLC.

Item 2.01. Completion of Acquisition or Disposition of Assets.

 

The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.01.

A copy of the press release announcing the Sale is attached as Exhibit 99.1 to this Form 8-K and incorporated herein by reference. The Company will file unaudited pro forma financial information giving effect to the Sale as an amendment to this Current Report on Form 8-K as soon as they are available.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

 

	99.1	Press Release of DURECT Corporation dated November 25, 2024
	104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

 

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

		DURECT Corporation
Date: November 25, 2024		By:		/s/ James E. Brown
				James E. Brown     Chief Executive Officer

 

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Exhibit 99.1

DURECT Corporation Announces Sale of ALZET® Product Line to Lafayette Instrument Co. for $17.5 Million

CUPERTINO, Calif. – Nov. 25, 2024 – DURECT Corporation (Nasdaq: DRRX), a late-stage biopharmaceutical company pioneering the development of epigenetic therapies to transform the treatment of serious and life-threatening conditions such as acute organ injury, today announced the sale of its ALZET® line of osmotic pumps to Lafayette Instrument Co. (LIC), a portfolio company of Branford Castle Partners II, L.P., a North-American focused private equity firm.

 

Under the terms of the agreement, LIC paid DURECT $17.5 million in exchange for certain assets and liabilities associated with the ALZET product line. Simultaneous with this transaction, DURECT has paid off all remaining obligations under the term loan agreement with Oxford Finance LLC.

 

“As DURECT continues to prioritize developing larsucosterol for alcohol-associated hepatitis (AH), we have determined that the ALZET product line is no longer aligned with our long-term strategic priorities,” said James E. Brown, D.V.M., President and Chief Executive Officer of DURECT. “This transaction strengthens our cash position and extends our cash runway through the first half of 2025. With the payment of the remainder of the Oxford term loan, we have greater financial flexibility as we seek financial resources to fund our planned Phase 3 clinical trial for larsucosterol in AH.”

 

“ALZET osmotic pumps are a great addition to our life science instruments. We look forward to continuing a shared legacy of premier products that support life-changing research,” said Ben Mangrich, Chief Executive Officer of Lafayette Instrument Company.

 

Aquilo Partners, L.P. acted as financial advisor and Wilson, Sonsini, Goodrich & Rosati acted as legal advisor to DURECT.

 

About ALZET
The ALZET product line consists of miniature, implantable osmotic pumps and accessories for research use in mice, rats and other laboratory animals. These pumps are neither approved nor intended for human use. ALZET pumps continuously deliver drugs, hormones and other test agents at controlled rates from one day to six weeks without the need for external connections, frequent handling or repeated dosing. In laboratory research, these infusion pumps can be used for systemic administration when implanted under the skin or in the body. They can be attached to a catheter for intravenous, intracerebral, or intra-arterial infusion or for targeted delivery, where the effects of a drug or test agent are localized in a particular tissue or organ. The wide use and applications of the ALZET product line is evidenced by the more than 22,000 published scientific references.

 

About DURECT Corporation
DURECT is a late-stage biopharmaceutical company pioneering the development of epigenetic therapies that target dysregulated DNA methylation to transform the treatment of serious and life-threatening conditions, including acute organ injury. Larsucosterol, DURECT’s lead drug candidate, binds to and inhibits the activity of DNA methyltransferases, epigenetic enzymes that are elevated and associated with hypermethylation found in AH patients. Larsucosterol is in clinical development for the potential treatment of AH, for which the FDA has granted a Fast Track and a Breakthrough Therapy designation; MASH is also being explored. In addition, POSIMIR® (bupivacaine solution) for infiltration use, a non-opioid analgesic utilizing the innovative SABER® platform technology, is FDA-approved. For more information about DURECT, please visit www.durect.com and follow us on X (formerly Twitter) at https://x.com/DURECTCorp.

DURECT Forward-Looking Statements

This press release contains forward-looking statements, including statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, relating to: our plans to conduct a Phase 3 clinical trial

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of larsucosterol, the sufficiency of our capital requirements through the first half of 2025 and the potential uses of larsucosterol to treat patients with AH and potentially other indications. Actual results may differ materially from those contained in the forward-looking statements contained in this press release, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from those projected include, among other things, the risk that future clinical trials of larsucosterol are delayed or do not confirm the results from subset analyses of the AHFIRM trial, including geographic or other segmentation, or of earlier clinical or pre-clinical trials, or do not demonstrate the safety or efficacy of larsucosterol in a statistically significant manner; the risk that we do not raise sufficient capital to commence or complete the Phase 3 clinical trial of larsucosterol in patients with AH or continue to fund our operations, the risk that the FDA or other government agencies may require additional clinical trials for larsucosterol before approving larsucosterol for the treatment of AH, the risk that Breakthrough Therapy designation does not expedite the process for FDA approval and that larsucosterol may never be approved; and risks related to the sufficiency of our cash resources, our anticipated capital requirements, our ability to continue to meet the minimum bid price for continued listing on Nasdaq, and our ability to continue to operate as a going concern. Further information regarding these and other risks is included in DURECT’s most recent Securities and Exchange Commission filings, including its annual report on Form 10-K for the year ended December 31, 2023 and quarterly report on Form 10-Q for the quarter ended September 30, 2024, under the heading “Risk Factors.” These reports are available on our website www.durect.com under the “Investors” tab and on the SEC’s website at www.sec.gov. All information provided in this press release is based on information available to DURECT as of the date hereof, and DURECT assumes no obligation to update this information as a result of future events or developments, except as required by law.

 

NOTE: POSIMIR® is a trademark of Innocoll Pharmaceuticals, Ltd. in the U.S. and a trademark of DURECT Corporation outside of the U.S. SABER® is a trademark of DURECT Corporation. Other referenced trademarks belong to their respective owners. Larsucosterol is an investigational drug candidate under development and has not been approved for commercialization by the U.S. Food and Drug Administration or other health authorities for any indication.

 

Investor Relations (DURECT)		Media Contact (DURECT)
Ashley Robinson		Jason Braco
LifeSci Advisors		LifeSci Communications
arr@lifesciadvisors.com		jbraco@lifescicomms.com

 

 

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v3.24.3

Document and Entity Information	Nov. 22, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 22, 2024
Title of 12(b) Security	Common Stock $0.0001 par value per share
Security Exchange Name	NASDAQ
Trading Symbol	DRRX
Entity Registrant Name	DURECT CORP
Entity Central Index Key	0001082038
Entity Emerging Growth Company	false
Entity File Number	000-31615
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	94-3297098
Entity Address, Address Line One	10240 Bubb Road
Entity Address, City or Town	Cupertino
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95014
City Area Code	408
Local Phone Number	777-1417
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false

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