Item 2.02. Results of Operations and Financial Condition.
On January 10, 2022, PTC Therapeutics, Inc. (the “Company”) issued a press release (the “press release”) announcing certain preliminary (unaudited) financial information for its fiscal year ending December 31, 2021, including that the Company expects to report (i) total unaudited net revenue of approximately $536 million, (ii) total unaudited net product revenue of approximately $429 million, (iii) net product revenue for Translarna™ (ataluren) of approximately $236 million, with approximately $70 million in revenue in the fourth quarter of 2021, and net product revenue for Emflaza® (deflazacort) of approximately $188 million, with approximately $48 million in revenue in the fourth quarter of 2021, (iv) collaboration and royalty revenue associated with Evrysdi of approximately $107 million and (v) ending cash, cash equivalents and marketable securities of approximately $773 million. Final results are subject to completion of the Company’s year-end audit.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On January 7, 2022 the Board of Directors of the Company promoted Matthew Klein, the Company’s Chief Development Officer, to the role of Chief Operating Officer, effective immediately. Dr. Klein, 50, has been the Company’s Chief Development Officer since April 2020. Dr. Klein joined the Company in October 2019 as Global Head Gene and Mitochondrial Therapies and became Global Head Clinical Development in March 2020. Prior to joining the Company, Dr. Klein was Chief Executive Officer of BioElectron Technology Corporation (“BioElectron”) from 2018 to 2019, and served as a board member of BioElectron from 2018 to 2020. Dr. Klein served as the Chief Medical Officer of BioElectron from 2013 to 2019 and was Senior Vice President, Clinical Science at BioElectron from 2012 to 2013. Dr. Klein has also served as a member of the board of directors of ClearPoint Neuro, Inc., a Nasdaq-listed company, since 2020 as our director designee. Dr. Klein has a BA from the University of Pennsylvania, an MD from Yale University School of Medicine and an MS in epidemiology from the University of Washington School of Public Health.
In connection with Dr. Klein’s promotion, his base salary was increased to $600,000 annually, with a target bonus of 50% of annual salaried earnings in accordance with the terms of the Company’s annual incentive compensation plan. Dr. Klein also received, pursuant to the Company’s 2013 Long Term Incentive Plan, a one-time grant of 50,000 stock options (the “Options”) to purchase shares of the Company’s common stock and 20,000 restricted stock units (the “RSUs”), each representing the right to receive one share of the Company’s common stock upon vesting. The Options and RSUs will each vest over two years with 50% of each award vesting on January 7, 2023 and 50% of each award vesting on January 7, 2024.
As previously disclosed, on October 25, 2019, the Company completed the acquisition (the “Acquisition”) of substantially all of the assets of BioElectron pursuant to an Asset Purchase Agreement by and between the Company and BioElectron, dated October 1, 2019 (the “Asset Purchase Agreement”).
Upon the closing of the Acquisition, the Company paid to BioElectron total upfront consideration of $10.0 million, funded with cash on hand, less (i) transaction expenses incurred by BioElectron, (ii) the amount of outstanding indebtedness of BioElectron and (iii) $1.5 million to be held in an escrow account to secure potential indemnification obligations owed to the Company. Subject to the terms and conditions of the Asset Purchase Agreement, BioElectron may become entitled to receive contingent milestone payments of up to $200.0 million (in cash or in shares of our common stock, as determined by the Company) from the Company based on the achievement of certain regulatory and net sales milestones. Subject to the terms and conditions of the Asset Purchase Agreement, BioElectron may also become entitled to receive contingent payments of a low single digit percentage of net sales of certain products.
At the time of the Acquisition, Dr. Klein was the Chief Executive Officer and director of BioElectron, and was, and remains as of the date of this Current Report on Form 8-K, a shareholder of BioElectron, owning approximately six percent of its outstanding shares. As a shareholder of BioElectron, Dr. Klein is entitled to receive a portion of any payments made to BioElectron pursuant to the Asset Purchase Agreement. Dr. Klein was not a related party at the time of the Acquisition.
Dr. Klein does not have a family relationship with any of the Company’s officers or directors.
Item 7.01. Regulation FD Disclosure.
