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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