Item 7.01 Regulation FD Disclosure.
Krystal Biotech, Inc. (the "Company") today announced that it has reached a
binding term sheet with PeriphaGen, Inc. ("PeriphaGen") to resolve all claims in
the trade secret litigation filed by PeriphaGen on May 20, 2020. The settlement
contains no admission of liability or wrongdoing and includes a full release of
the claims made against the Company, Krish Krishnan, Suma Krishnan, PeriphaGen,
James Wechuck and David Krisky.
Pursuant to the term sheet, which is legally binding, PeriphaGen will transfer
to the Company all of PeriphaGen's biological materials and skin assets, and the
Company will pay PeriphaGen a one-time payment of $25 million. In addition, upon
approval of the Company's first product by the U.S. Food and Drug Administration
(FDA), it will pay PeriphaGen an additional $12.5 million in milestone payment,
followed by three additional $12.5 million milestone payments upon the Company
reaching $100 million in total cumulative sales, $200 million in total
cumulative sales, and $300 million in total cumulative sales, respectively, as
reported by the Company in its annual 10-K filings. The parties expect to enter
into a final settlement agreement memorializing the terms of the binding term
sheet, and the case is expected to be formally dismissed by United States
District Court for the Western District of Pennsylvania within a month.
The Company issued a press release regarding this settlement, a copy of which is
attached to this Report as Exhibit 99.1 and incorporated by reference herein.
The information in this Item 7.01, including Exhibit 99.1, is furnished and
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to
liabilities under that section, and shall not be deemed to be incorporated by
reference into the filings of the Company under the Securities Act or the
Exchange Act, regardless of any general incorporation language in such filings.
This Current Report will not be deemed an admission as to the materiality of any
information of the information in this Item 7.01, including Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
99.1 Press Release, dated March 15, 2022
104 Cover Page Interactive Data file (embedded within the Inline XBRL document)
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