RedHill Biopharma Ltd F-1, filed Dec 31, 2025
RedHill Biopharma Ltd. (RDHL)
F-1
2025-12-31
View Original
Added on
October 16, 2026
As filed with the Securities and Exchange Commission on December 31, 2025
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
REDHILL BIOPHARMA LTD.
(Exact name of Registrant as specified in its charter)
Not Applicable
(Translation of Registrant’s name into English)
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Israel
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2834
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Not Applicable
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(State or other jurisdiction of
incorporation or organization) |
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(Primary Standard Industrial
Classification Code Number) |
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(I.R.S. Employer
Identification No.) |
21 Ha'arba'a Street
Tel Aviv, 6473921, Israel
Tel: 972-3-541-3131
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
RedHill Biopharma Inc.
8311 Brier Creek Parkway
Suite 105-161
Raleigh, NC 27617
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
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Rick A. Werner, Esq.
Jayun Koo, Esq.
Haynes and Boone, LLP
30 Rockefeller Plaza, 26th Floor
New York, New York 10112
Tel. (212) 659-7300
Fax (212) 918-8989
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Perry Wildes, Adv.
Goldfarb Gross Seligman & Co.
One Azrieli Center
Tel Aviv 6702100, Israel
+972 (3) 607-4444
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Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
Emerging growth company ☐
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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 7(a)(2)(B) of the Securities Act. ☐
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment
which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the
Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.
The information in this preliminary prospectus is not complete and may be changed. The selling shareholder named in this prospectus may not sell these
securities until the registration statement filed with the Securities and Exchange Commission, of which this preliminary prospectus is a part, is effective. This preliminary prospectus is not an offer to sell these securities, and the selling
shareholder named in this prospectus is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED DECEMBER 31, 2025
PRELIMINARY PROSPECTUS
REDHILL BIOPHARMA LTD.
6,465,559 AMERICAN DEPOSITARY SHARES REPRESENTING 64,655,590,000
ORDINARY SHARES
This prospectus relates to the offer and sale, from time to time, of up to 6,465,559 American Depositary Shares (“ADSs”), by YA II PN, LTD. (“YA” or the “Selling Shareholder”), a
Cayman Islands exempt limited partnership, including (i) up to 5,000,000 ADSs that we may, at our discretion, elect to issue and sell to YA from time to time after the date of this prospectus pursuant to the Purchase Agreement (as defined below),
(ii) 386,593 ADSs (the “Initial Equity Shares”) issued to YA on the date of execution of the Purchase Agreement at a price of $1.0235 per Initial Equity Share, (iii) 590,446 ADSs issuable upon exercise of pre-funded warrants (the “Pre-Funded
Warrants”) at the exercise price of $0.0001 per ADS, that were issued to YA on the date of execution of the Purchase Agreement at a price of $1.0234 per Pre-Funded Warrant (the issuance of the Initial Equity Shares and the Pre-Funded Warrants, the
“Initial Equity Issuance”), and (iv) an aggregate of 488,520 ADSs issuable to YA as consideration for its irrevocable commitment to purchase the ADSs under the Purchase Agreement (the “Commitment Shares”), to be issued in four installments, of which
122,130 ADSs were issued on the date of execution of the Purchase Agreement (the “Initial Commitment Shares”), and an aggregate of 366,390 ADSs to be issued in three equal installments – on the 90th day, 180th day and 270th
day anniversary of the execution of the Purchase Agreement (the “Subsequent Commitment Shares”). Each ADS represents 10,000 of our ordinary shares, no par value (“Ordinary Shares”).
The Ordinary Shares represented by ADSs being offered by YA are to be issued and sold pursuant to that certain Standby Equity Purchase Agreement, dated December 19, 2025 that we
entered into with YA (the “Purchase Agreement”). We are not selling any securities under this prospectus and will not receive any of the proceeds from the sale of the ADSs by YA. However, we may receive up to $25.0 million in aggregate gross proceeds
from sales of the ADSs to YA that we may make under the Purchase Agreement, from time to time during the 36 months following the execution of the Purchase Agreement (the “Advance Shares”). On the date of execution of the Purchase Agreement, we also
issued to YA, the Initial Equity Shares and the Pre-Funded Warrants for aggregate gross proceeds of $1 million, in addition to the $25.0 million aggregate commitment under the Purchase Agreement, at a price of $1.0235 per Initial Equity Share and
$1.0234 per Pre-Funded Warrant. The Pre-Funded Warrants may only be exercised to purchase whole ADSs at an exercise price of $0.0001 per ADS. The Pre-Funded Warrants are immediately exercisable and may be exercised at any time until all of the
Pre-Funded Warrants are exercised in full except with respect to ownership limitations described below.
The additional 5,000,000 ADSs representing Advance Shares that may be offered pursuant to this prospectus and YA agreed to purchase from time to time pursuant to the Purchase
Agreement would be purchased at a price per ADS price equal to, at our election, as specified in the relevant notice sent by us to YA setting forth the number of ADSs that we desire to issue and sell to YA (the “Advance Notice”): (i) 95% of the
Market Price (as defined below) on the applicable trading day of delivery of such Advance Notice (the “Option 1 Pricing Period”), or (ii) 97% of the Market Price for the three consecutive trading days commencing on the day such Advance Notice is
deemed delivered (the “Option 2 Pricing Period,” and each of the Option 1 Pricing Period and the Option 2 Pricing Period, a “Pricing Period”). “Market Price” is defined as, for any Option 1 Pricing Period, the volume weighted average price (“VWAP”)
of the ADSs during the Option 1 Pricing Period, and for any Option 2 Pricing Period, the lowest daily VWAP of the ADSs during the Option 2 Pricing Period, excluding certain days as set forth in the Purchase Agreement.
In addition, we may not issue or sell any ADSs to YA under the Purchase Agreement, and YA will not have the right to exercise any portion of its Pre-funded Warrants for ADSs, if
such ADSs, when aggregated with all other ADSs and ordinary shares then beneficially owned by YA and its affiliates, would result in YA and its affiliates beneficially owning more than 9.99% of the then outstanding ADSs (the “Ownership Limitation”).
The purchase price in each Advance Notice will fluctuate based on the market price of the ADSs, and although we may specify a certain minimum acceptable price per ADS in each
Advance using the Option 2 Pricing Period, the Purchase Agreement does not provide a set floor price. Accordingly, it is not possible, at this stage, to predict the number of ADSs that may ultimately be sold pursuant to the Purchase Agreement.
Pursuant to the Purchase Agreement, in the event that we sell all of the ADSs registered herein, we will have to file one or more new registration statements to register resale of the additional ADSs, and such additional new registration statements
shall be effective before we can obligate YA to purchase additional ADSs pursuant to the Purchase Agreement.
If the total number of ADSs traded on Nasdaq during the applicable Pricing Period is less than the Volume Threshold (as defined below), then the number of ADSs issued and sold
pursuant to such Advance Notice will be reduced to the greater of (i) 30% of the trading volume of the ADSs on Nasdaq during the relevant Pricing Period or (ii) the number of ADSs sold by the Investor during such Pricing Period, but in each case not
to exceed the amount requested in the Advance Notice. “Volume Threshold” is defined as a number of ADSs equal to the quotient of (i) the number of ADSs requested by us in the Advance Notice divided by (ii) 0.30.
Due to the reasons above, we may not have access to the right to sell the full $25 million of ADSs under the Purchase Agreement to YA.
YA may sell the ADSs included in this prospectus in a number of different ways and at varying prices. We provide more information about how YA may sell the shares in the section
entitled “Plan of Distribution.” YA is an “underwriter” within the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended, the Securities Act. Any underwriters, broker-dealers or agents that
participate in the sale of the ADSs or interests therein may be “underwriters” within the meaning of Section 2(a)(11) of the Securities Act and any discounts, commissions, or concessions received by the Selling Shareholder are deemed to be
underwriting discounts and commissions under the Securities Act.
YA will pay all brokerage fees and commissions and similar expenses in connection with the offer and sale of the shares by YA pursuant to this prospectus. We will pay the expenses
(except brokerage fees and commissions and similar expenses) incurred in registering under the Securities Act the offer and sale of the shares included in this prospectus by YA. See “Plan of Distribution.”
The ADSs are listed on The Nasdaq Capital Market under the symbol “RDHL.” On December 30, 2025, the last reported sales price of the ADSs was $1.03 per ADS.
We are a “foreign private issuer” as defined under the federal securities laws and, as such, are subject to reduced public company reporting requirements. See “Prospectus Summary – Implications of Being a Foreign Private Issuer.”
Investing in the ADSs involves a high degree of risk. Please carefully consider the risks discussed in this prospectus under “Risk Factors” beginning on page 12 and the “Risk Factors” in
“Item 3: Key Information - Risk Factors” of our most recent Annual Report on Form 20-F and under similar headings in other documents incorporated by
reference in this prospectus and in any applicable prospectus supplement for a discussion of the factors you should consider carefully before deciding to purchase the ADSs.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or determined if this
prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2025
TABLE OF CONTENTS
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i
This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the “SEC”). As permitted by the rules and regulations of the
SEC, the registration statement filed by us includes additional information not contained in this prospectus. You may read the registration statement and the other reports we file with the SEC at the SEC’s website or its offices described below under
the heading “Where You Can Find More Information.”
The Selling Shareholder named in this prospectus may resell, from time to time, in one or more offerings, the ADSs covered by this prospectus. Information about the selling
shareholder may change over time.
This prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete
information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration
statement of which this prospectus is a part, and you may obtain copies of those documents as described below. You should read this prospectus in its entirety before making an investment decision. You should also read and consider the information in
the documents to which we have referred you in the section of the prospectus entitled “Where You Can Find More Information” and “Incorporation of Certain Information by
Reference.”
We have not, and the Selling Shareholder has not, authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We take
no responsibility for and can provide no assurance as to the reliability of any other information that others may give you. This prospectus does not constitute an offer to sell, or a solicitation of an offer to purchase, the securities offered by
this prospectus in any jurisdiction to or from any person to whom or from whom it is unlawful to make such offer or solicitation of an offer in such jurisdiction. The information in this prospectus is accurate only as of the date of this prospectus,
regardless of the time of delivery of this prospectus or any sale of our securities.
We further note that the representations, warranties and covenants made by us in any agreement that is filed as an exhibit to any document that is incorporated by reference herein
were made solely for the benefit of the parties to such agreement, including, in some cases, for the purpose of allocating risk among the parties to such agreements, and should not be deemed to be a representation, warranty or covenant to you.
Moreover, such representations, warranties or covenants were accurate only as of the date when made. Accordingly, such representations, warranties and covenants should not be relied on as accurately representing the current state of our affairs.
For investors outside the United States: We have not done anything that would permit the sale of our securities in any jurisdiction where action for that purpose is required, other
than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the securities and the distribution of this prospectus
outside the United States.
Unless the context otherwise requires, all references to “RedHill,” “we,” “us,” “our,” the “Company” and similar designations refer to RedHill Biopharma Ltd. and its wholly owned
subsidiary, RedHill Biopharma Inc. The term “including” means “including but not limited to,” whether or not explicitly so stated. The term “NIS” refers to New Israeli Shekels, the lawful currency of the State of Israel, the terms “dollar,” “USD $,”
“$” or “U.S.” refer to U.S. dollars, the lawful currency of the United States of America. Our functional and presentation currency is the U.S. dollar. Foreign currency transactions in currencies other than U.S. dollars are translated in this
prospectus into U.S. dollars using exchange rates in effect at the date of the transactions.
Unless otherwise indicated or the context requires, the term “therapeutic candidates” refers to investigational drug products that are still in development and have not been
approved by the United States Food and Drug Administration (“FDA”) or other relevant regulatory authority and the term “commercial products” means products approved by the FDA that we commercialize or promote from time to time.
Effective August 20, 2024, we effected a ratio change of the ADSs to our Ordinary Shares from the previous ratio of one (1) ADS representing four hundred (400) Ordinary Shares to a
new ratio of one (1) ADS representing ten thousand (10,000) Ordinary Shares. The ratio change had the same effect as a one-for-twenty-five reverse ADS split. Unless otherwise indicated, ADSs and per ADS amounts in this prospectus have been
retroactively adjusted to reflect the changes in ratio for all periods presented.
1
This prospectus includes or incorporates by reference statistical, market and industry data and forecasts which we obtained from publicly available information and independent
industry publications and reports that we believe to be reliable sources. These publicly available industry publications and reports generally state that they obtain their information from sources that they believe to be reliable, but they do not
guarantee the accuracy or completeness of the information. Although we are responsible for all of the disclosures contained in this prospectus, including such statistical, market and industry data, we have not independently verified any of the data
from third-party sources, nor have we ascertained the underlying economic assumptions relied upon therein. In addition, while we believe the market opportunity information included in this prospectus is generally reliable and is based on reasonable
assumptions, such data involves risks and uncertainties, including those discussed under the heading “Risk Factors.”
2
This prospectus and the information incorporated by reference herein contain statements that constitute forward-looking statements, including statements concerning our industry,
our operations, our anticipated financial performance and financial condition, and our business plans and growth strategy and product development efforts. These statements involve known and unknown risks, uncertainties and other factors that may
cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. In some cases, you can identify forward-looking statements
by terms, including “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would,” and similar expressions intended to identify forward-looking statements.
Forward-looking statements reflect our current views with respect to future events and are based on assumptions and subject to risks and uncertainties, many of which are beyond the Company’s control and cannot be predicted or quantified. In addition,
this prospectus, our Annual Report on Form 20-F for the year ended December 31, 2024, and documents incorporated by reference into this prospectus contain information obtained from independent industry and
other sources that we may not have independently validated. You should not put undue reliance on any forward-looking statements. Unless we are required to do so under U.S. federal securities laws or other applicable laws, we do not intend to update
or revise any forward-looking statements.
Factors that could cause our actual results to differ materially from those expressed or implied in such forward-looking statements include, but are not limited to:
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the going concern reference in our financial statements and our ability to obtain additional financing or successfully conclude a strategic business transaction;
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our ability to maintain compliance with the listing standards of Nasdaq;
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our ability to close strategic business transactions;
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estimates of our expenses, future revenues, capital requirements and our needs for additional financing;
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our ability to obtain additional financing;
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the ability to successfully commercialize Talicia® in the U.S as part of our collaboration arrangement with Cumberland Pharmaceuticals Inc. (“Cumberland”) and the success of the joint decision-making and division of responsibilities for
such collaboration;
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the commercialization and market acceptance of Talicia® and any future commercial products;
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the ability to generate sufficient revenues from Talicia® and any future commercial products, including obtaining commercial insurance and government reimbursement;
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our ability to advance our therapeutic candidates into clinical trials or to successfully complete our preclinical studies or clinical trials, and to complete the development of such therapeutic candidates and obtain approval for marketing
by the FDA or other regulatory authorities;
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our reliance on third parties to satisfactorily conduct key portions of our commercial operations, including manufacturing and other supply chain functions, market analysis services, safety monitoring, regulatory reporting and sales data
analysis and the risk that those third parties may not perform such functions satisfactorily;
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our ability to maintain an appropriate sales and marketing infrastructure;
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our ability to establish and maintain corporate collaborations;
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that Talicia® or commercial products that we may commercialize or promote in the future may be withdrawn from the market by regulatory authorities and our need to comply with continuing laws, regulations and guidelines to maintain
clearances and approvals for those products;
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our exposure to significant drug product liability claims;
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the initiation and completion of any postmarketing studies or trials;
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our ability to acquire products approved for marketing in the U.S. that achieve commercial success and to maintain our own marketing and commercialization capabilities;
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our estimates of the markets, their size, characteristics and their potential for Talicia® and any future commercial products and therapeutic candidates and our ability to serve those markets;
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the successful commercialization of products we in-license or acquire;
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our inability to enforce claims relating to a breach of a representation and warranty by a counterparty;
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the hiring and continued employment of executives, sales personnel, and contractors;
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our receipt and timing of regulatory clarity and approvals for Talicia® and any future commercial products and therapeutic candidates, and the timing of other regulatory filings and approvals;
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the initiation, timing, progress, and results of our research, development, manufacturing, preclinical studies, clinical trials, and other commercial efforts and therapeutic candidate development, as well as the extent and number of
additional studies that we may be required to conduct;
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our ability to advance our therapeutic candidates into clinical trials or to successfully complete our preclinical studies or clinical trials;
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our ability to develop or obtain approval for RHB-104/RHB-204 in Crohn’s may be adversely impacted if a validated lab test for MAP will not become available;
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our reliance on third parties to conduct key portions of our clinical trials, including data management services and the risk that those third parties may not perform such functions satisfactorily;
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our reliance on third parties to manufacture and supply our therapeutic candidates and their respective active pharmaceutical ingredients with the requisite quality and manufacturing standards in sufficient quantities and within the
required timeframes and at an acceptable cost;
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the research, manufacturing, clinical development, commercialization, and market acceptance of our therapeutic candidates;
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the interpretation of the properties and characteristics of Talicia® and any future commercial products or therapeutic candidates and of the results obtained in research, preclinical studies or clinical trials;
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the implementation of our business model, strategic plans for our business, commercial products, and therapeutic candidates;
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the impact of other companies and technologies that compete with us within our industry;
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the scope of protection we are able to establish and maintain for intellectual property rights covering Talicia® and any future commercial products and therapeutic candidates, including from existing or future claims of infringement, and
our ability to operate our business without infringing or violating the intellectual property rights of others;
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parties from whom we license or acquire our intellectual property defaulting in their obligations toward us;
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the failure by a licensor or a partner of ours to meet their respective obligations under our acquisition, in-license or other development or commercialization agreements or renegotiate the obligations under such agreements, or if other
events occur that are not within our control, such as bankruptcy of a licensor or a partner;
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our reliance on the actions of third parties, including sublicensors and their other sublicensees, to maintain our rights under our in-licenses which are sublicenses;
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the effect of a potential occurrence of patients suffering serious adverse events using investigative drugs under our Expanded Access Program;
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our ability to implement network systems and controls that are effective at preventing cyber-attacks, malware intrusions, malicious viruses and ransomware threats;
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the impact on our business of the political and security situation in Israel, the U.S. and other places in which we operate; and
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other factors discussed in other factors disclosed in this prospectus and in the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2024.
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Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make. No forward-looking
statement is a guarantee of future performance. You should read this prospectus, the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, and in any document incorporated by reference herein completely and with the
understanding that our actual future results may be materially different from what we expect. The forward-looking statements in this prospectus represent our views as of the date of this prospectus. We anticipate that subsequent events and
developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law. You should,
therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this prospectus.
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This summary highlights information contained in other parts of this prospectus or incorporated by reference into this prospectus from our filings with the SEC,
listed in the section of the prospectus entitled “Incorporation of Certain Information by Reference.” Because it is only a summary, it does not contain all of the information that you should consider before purchasing our securities in this offering
and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere or incorporated by reference into this prospectus. You should read the entire prospectus, the registration statement of
which this prospectus is a part, and the information incorporated by reference herein in their entirety, including the “Risk Factors” and our financial statements and the related notes incorporated by reference into this prospectus, before making an
investment decision. Some of the statements in this prospectus and the documents incorporated by reference herein constitute forward-looking statements that involve risks and uncertainties. See information set forth under the section “Cautionary Note
Regarding Forward-Looking Statements.”
Overview
We are a specialty biopharmaceutical company, primarily focused on GI, infectious diseases, medical countermeasures and oncology. Our primary goal is to become a leading specialty
biopharmaceutical company.
We are currently focused primarily on the advancement of our development pipeline of clinical-stage therapeutic candidates. Through our collaboration with Cumberland, we also
commercialize in the U.S. our GI-related product, Talicia® (omeprazole, amoxicillin, and rifabutin), and we have entered into other collaboration agreements to commercialize Talicia® outside the U.S. We continue to explore our strategic plans for
other potential products and activities.
Among our therapeutic candidates, we are exploring opaganib as a potential treatment for various conditions, including GI-ARS, viral infections such as COVID-19, Ebola virus
disease and additional viruses as part of pandemic preparedness, several cancers and diabetes and obesity-related disorders. Furthermore, we are investigating RHB-107 (upamostat) as a potential treatment for COVID-19 and other viruses as part of
pandemic preparedness.
Our current pipeline consists of five therapeutic candidates, part of which are in late stage clinical development. We generate our pipeline of therapeutic candidates by
identifying, validating and in-licensing or acquiring products that are consistent with our product and corporate strategy and that have the potential to exhibit a favorable probability of therapeutic and commercial success. We have one product,
Talicia®, that we primarily developed internally which has been approved for marketing and, to date, none of our other therapeutic candidates has generated revenues. We have out-licensed our commercial product, Talicia®, for specific territories
outside the U.S., and one of our therapeutic candidates, RHB-102, worldwide (except for the U.S., Canada, and Mexico). Furthermore, we plan to commercialize our therapeutic candidates, upon approval, if any, through licensing and other
commercialization arrangements with pharmaceutical companies on a global and territorial basis or independently with a dedicated commercial operation or in potential partnership with other commercial-stage companies. We also evaluate, on a
case-by-case basis, co-development, co-promotion, licensing, acquisitions and similar arrangements.
Recent Events
Standby Equity Purchase Agreement with YA
On December 19, 2025, we entered into the Purchase Agreement with YA, pursuant to which YA has committed to purchase up to $25.0 million of Advance Shares at our direction from
time to time, subject to the restrictions and satisfaction of the conditions in the Purchase Agreement, during the period commencing on the date of execution of the Purchase Agreement until the earlier of (i) the 36-month anniversary of the date of
execution of the Purchase Agreement and (ii) YA’s purchase of the total Commitment Amount under the Purchase Agreement.
Pursuant to the Purchase Agreement, we agreed to issue an aggregate of 488,520 ADSs as Commitment Shares to YA as consideration for its irrevocable commitment to purchase the
ADSs under the Purchase Agreement to be issued in four installments, of which (i) 122,130 Initial Commitment Shares were issued on the date of execution of the Purchase Agreement and (ii) an aggregate of 366,390 ADSs as Subsequent Commitment Shares
to be issued in three equal installments – on the 90th day, 180th day and 270th day anniversary of the execution of the Purchase Agreement. The resale by YA of the Initial Commitment Shares and Subsequent Commitment
Shares is covered by this prospectus.
5
In addition, on the date of execution of the Purchase Agreement, we issued to YA 386,593 ADSs as the Initial Equity Shares and Pre-Funded Warrants to purchase 590,446 ADSs, for
aggregate gross proceeds of $1.0 million, at a price of $1.0235 per Initial Equity Share and $1.0234 per Pre-Funded Warrant. The Pre-Funded Warrants may only be exercised to purchase whole ADSs at an exercise price of $0.0001 per ADS. The Pre-Funded
Warrants are immediately exercisable and may be exercised at any time until all of the Pre-Funded Warrants are exercised in full except with respect to ownership limitations described below. The sale of the Initial Equity Shares and the Pre-Funded
Warrants for aggregate gross proceeds of $1.0 million is in addition to the $25.0 million aggregate commitment under the Purchase Agreement.
YA has no right to require us to sell any ADSs to YA, but YA is obligated to make purchases of the Advance Shares as directed by us, subject to the restrictions and satisfaction
of conditions set forth in the Purchase Agreement upon receipt of a notice sent by us to YA setting forth the number of ADSs that we desire to issue and sell to YA, or an Advance Notice. Each Advance may be up to Ownership Limitation prior to
delivery of the relevant Advance Notice.
Actual sales of the Advance Shares to YA from time to time will depend on a variety of factors, including, among others, market conditions, the trading price of the ADSs and
determinations by us as to the appropriate sources of funding for us and our operations. The purchase price for each Advance Share that we may direct YA to purchase from time to time under the Purchase Agreement will be equal to, at our election as
specified in the relevant Advance Notice: (i) 95% of the Market Price on the applicable trading day of delivery of such Advance Notice, or (ii) 97% of the Market Price for the three consecutive trading days commencing on the day such Advance Notice
is deemed delivered . . We may also specify a certain minimum acceptable price per ADS in each Advance using the Option 2 Pricing Period.
Additionally, if the total number of ADSs traded on Nasdaq during the applicable Pricing Period is less than the Volume Threshold (as
defined below), then the number of ADSs issued and sold pursuant to such Advance Notice will be reduced to the greater of (i) 30% of the trading volume of the ADSs on Nasdaq during the relevant Pricing Period or (ii) the number of ADSs sold by the
Investor during such Pricing Period, but in each case not to exceed the amount requested in the Advance Notice. “Volume Threshold” is defined as a number of ADSs equal to the quotient of (x) the number of ADSs requested by us in the Advance Notice
divided by (y) 0.30.
As of December 30, 2025, there were 5,092,326 ADSs outstanding, of which 5,051,899 ADSs were held by non-affiliates. The number of ADSs registered for resale under this prospectus reflects
approximately the number of ADSs authorized and available for issuance under our articles of association after taking into account ADSs reserved for issuance for other purposes, such as ADSs underlying outstanding warrants and ADSs issuable in
connection with employee and executive compensation. The actual number of ADSs sold to YA pursuant to the Purchase Agreement will depend on the market price of the ADSs at the time of each Advance. If all of the 6,465,559 ADSs offered for resale by
YA under this prospectus were issued and outstanding, such ADSs would represent approximately 55.94% of the total number of ADSs outstanding and approximately 56.14% of the total number of outstanding ADSs held by non-affiliates, in each case as of
December 30, 2025. The Purchase Agreement provides that we may sell up to an aggregate of $25.0 million of ADSs to YA. We have filed the registration statement that includes this prospectus so that we may issue and sell to YA up to 6,465,559 ADSs
from time to time during the Commitment Period, subject to the restrictions and satisfaction of the conditions in the Purchase Agreement, through sales under the Purchase Agreement. Depending on the market prices of the ADSs at the time we elect to
issue such shares to YA under the Purchase Agreement, we may need to sell more ADSs to YA than the number of ADSs registered for resale by YA under this prospectus to receive aggregate gross proceeds equal to the approximately $25.0 million total
commitment of YA under the Purchase Agreement, which could cause additional substantial dilution to our shareholders. The number of shares ultimately offered for resale by YA is dependent upon the number of shares we issue and sell to YA under the
Purchase Agreement. In addition, before we can sell such additional ADSs to YA under the Purchase Agreement, we will be required to file one or more additional registration statements registering the resale of such additional ADSs by YA, which
could cause the price of the ADSs to decline.
In addition, we may not issue or sell any ADSs to YA under Purchase Agreement, and YA will not have the right to exercise any portion of its Pre-funded Warrants for ADSs, if
such ADSs, when aggregated with all other ADSs and ordinary shares then beneficially owned by YA and its affiliates, would result in YA and its affiliates beneficially owning more than 9.99% of the then outstanding ADSs, as calculated pursuant to
Section 13(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and Rule 13d-3 thereunder, which limitation we refer to as the Ownership Limitation
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The net proceeds under the Purchase Agreement to us will depend on the frequency and prices at which we sell ADSs, our ability to meet the conditions set forth in the Purchase
Agreement and any impacts of the ownership limitations described above. We expect that any proceeds received by us from such sales of ADSs under the Purchase Agreement will be used for general corporate purposes.
Pursuant to the Purchase Agreement, we have agreed that from the date of execution of the Purchase Agreement until the earlier of (i) the lapse of 75 days or (ii) the date YA
has resold all of the Initial Equity Shares, we may not effect or enter an agreement to effect any issuance involving a variable rate transaction, including without limitation, pursuant to any existing equity line of credit (including the Any Market
Purchase Agreement (as defined below)) or the under the Wainwright Sales Agreement (as defined below) at prices below the Initial Equity Purchase Price. In addition, YA has agreed that, during the term of the Purchase Agreement, neither YA nor its
affiliates will engage in any short sales or “put equivalent position” (as defined in Rule 16a-1 of the Securities Exchange Act of 1934, as amended) with respect to ADSs solely to the extent that such “put equivalent position” establishes a net
short position with respect to the ADSs, provided that YA or its affiliates may (i) sell “long”, as such term is defined in Rule 200 of Regulation SHO of the Exchange Act, the Commitment Shares and any Advance Shares issued and sold by us to YA
pursuant to an Advance Notice and (ii) sell a number of ADSs equal to the number of Advance Shares that YA is unconditionally obligated to purchase under a pending Advance Notice but has not yet received from us or our transfer agent pursuant to the
Purchase Agreement, or (i) and (ii) collectively, the Permitted Sales.
The Purchase Agreement contains customary representations, warranties, conditions and indemnification obligations of the parties. The representations, warranties and covenants
were made only for purposes of such agreements and as of specific dates, were solely for the benefit of the parties to such agreements and may be subject to limitations agreed upon by the contracting parties.
We have the right to terminate the Purchase Agreement at any time, at no cost or penalty, upon five trading days’ prior written notice to YA, provided that (i) there are no
outstanding Advance Notices, the Advance Shares under which have yet to be issued and (ii) we have paid all amounts owed to YA pursuant to the Purchase Agreement.
There are substantial risks to our shareholders as a result of the sale and issuance of ADSs to YA under the Purchase Agreement. These risks include substantial dilution,
significant declines in our share price and our inability to draw sufficient funds when needed. See the section titled “Risk Factors.” Issuances of the ADSs under the Purchase Agreement will not affect the
rights or privileges of our existing shareholders, except that the economic and voting interests of each of our existing shareholders will be diluted as a result of any such issuance. Although the number of ADSs that our existing shareholders own
will not decrease, the ADSs owned by our existing shareholders will represent a smaller percentage of our total outstanding ADSs after any such issuances pursuant to the Purchase Agreement.
The description of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Purchase Agreement, a copy of
which is filed as an exhibit to the registration statement of which this prospectus forms a part and is incorporated herein by reference.
Transaction with Cumberland
On October 20, 2025, we announced that we had entered into definitive agreements with Cumberland relating to Talicia® (omeprazole
magnesium, amoxicillin and rifabutin). The transaction was effected through Talicia Holdings Inc. (“Talicia Holdings”), our recently formed subsidiary established to hold the global rights to Talicia® and oversee its commercialization worldwide,
including through partnerships.
Under a Stock Purchase Agreement between Talicia Holdings and Cumberland, Cumberland agreed to invest $4 million, payable in two equal
tranches - $2 million of which was paid at closing and $2 million to be paid within 12 months of execution of the definitive agreements, to acquire a 30% equity interest in Talicia Holdings. We retained 70% ownership. Talicia Holdings is jointly
controlled by RedHill and Cumberland under accompanying governance arrangements that provide for equal board representation and joint decision-making on key matters. In addition, under a related shareholders agreement, the transfer of shares by
either us or Cumberland is subject to a right of refusal by the other party, and each party is subject to non-competition and non-solicitation obligations for so long as such party owns shares in Talicia Holdings.
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Concurrently, Talicia Holdings and Cumberland entered into a five-year Exclusive Joint Commercialization Agreement for Talicia® in the
United States. Under the agreement, the parties will jointly commercialize Talicia® in the U.S., through a joint commercialization committee with equal representation and joint decision-making to oversee commercialization, pricing, contracting,
sales and marketing activities related to Talicia®. Net revenues from U.S. sales of Talicia® will be shared equally between the parties. As part of the agreement, Talicia Holdings granted Cumberland an exclusive license to use Talicia Holdings’
intellectual property solely for the joint commercialization of Talicia® under the agreement, and sublicensing or co-promotion by Cumberland requires Talicia Holdings’ prior written consent.
Cumberland will deploy its national sales organization to promote Talicia® and will conduct trade operations, including handling
commercialization, sales, warehousing and distribution in the U.S., in accordance with Committee-approved plans, and will fund significant commercialization activities approved by the Committee. Talicia Holdings will oversee market access, marketing,
regulatory approvals, and medical affairs activities, as well as manufacturing, quality, and supply of the product, bearing the related cost of goods.
Equity Line of Credit
On June 20, 2025, we entered into the Any Market Purchase Agreement with Alumni Capital LP (“Alumni”) establishing a USD $10 million equity line of credit (as amended, “Any Market
Purchase Agreement”). Pursuant to the Any Market Purchase Agreement, the Company has the right, but not the obligation, to issue, from time to time, at the Company’s discretion, to Alumni, and Alumni is obligated to purchase, ADSs for an aggregate
purchase price of up to USD $10 million (the “Alumni Commitment Amount”) at the Company’s request and subject to the terms of the Any Market Purchase Agreement, any time during the period commencing on June 20, 2025 and ending on the earlier (i) the
date on which the ADSs cease trading on the NYSE, the NYSE American, The Nasdaq Capital Market, The Nasdaq Global Market, or The Nasdaq Global Select Market (or any nationally recognized successor to any of the foregoing (an
“Eligible Market”), (ii) the date on which the Investor shall have purchased Purchase Notice Securities for an aggregate purchase price equal to the Alumni Commitment Amount, or (iii) 5:00 p.m. Eastern Time on June 30, 2026.
The ADSs are to be issued and sold to Alumni at a per ADS price equal to, at the election of the Company as specified in the relevant written notice from the Company to Alumni (the
“Purchase Notice”), subject to the terms of the Any Market Purchase Agreement: (i) the lowest daily volume weighted average price of the ADSs during the five (5) consecutive business days immediately prior to the date of the Purchase Notice (each
such date, a “Purchase Notice Date”) with respect to a Purchase Notice (a “Regular Purchase Notice”), as determined by Alumni, multiplied by ninety percent (90%) (the “Regular Purchase Price”) or (ii) the lowest traded price of the ADSs on the
Purchase Notice Date with respect to a Purchase Notice (a “Forward Purchase Notice”), as determined by Alumni, multiplied by ninety six percent (96%) (the “Forward Purchase Price”).
In consideration for Alumni’s execution and delivery of the Any Market Purchase Agreement, on June 20, 2025, we issued to Alumni an unregistered commitment warrant valid for a term
of five years, entitling Alumni to purchase up to 333,333 ADSs at $3.00 per ADS, subject to adjustments therein.
To date, we have sold 2,247,136 ADSs at a weighted average offering price of approximately $1.48 per ADS for aggregate net proceeds of approximately $3.3 million pursuant to the
Any Market Purchase Agreement.
Under the Any Market Purchase Agreement, we may, at our discretion, direct Alumni to purchase (A) the number of ADSs having an aggregate purchase price equal to the lesser of
$500,000 or sixty percent (60%) of the average daily trading volume of the ADSs on the Principal Market over the most recent five business days prior to the respective Purchase Notice Date, unless waived upon mutual discretion between us and Alumni,
up to an amount no greater than an aggregate purchase price equal to $3,000,000, at the Regular Purchase Price, or (B) the number of ADSs having an aggregate purchase price equal to the lesser of $500,000 or thirty percent (30%) of the trading volume
of the ADSs on the Principal Market beginning at 4:00 a.m. New York time on the Purchase Notice Date and ending at the time on the Purchase Notice Date that the Purchase Notice has been received by email by Alumni, at the Forward Purchase Price.
Subject to the terms of the Any Market Purchase Agreement, we may deliver up to two Purchase Notices with the Forward Purchase Price on any given business day. The Any Market Purchase Agreement also prohibits us from directing Alumni to purchase any
ADSs (i) if those ADSs, when aggregated with all other ADSs then held or beneficially owned by Alumni and its affiliates, would result in Alumni and its affiliates holding or having beneficial ownership, at any single point in time, of more than
4.99% (9.99% in the case of Forward Purchase Notices) of the number of ADSs outstanding immediately after the issuance of Purchase Notice Securities issuable pursuant to a Purchase Notice, or (ii) where the issuance of such ADSs, when aggregated with
all other ADSs and Ordinary Shares then held or beneficially owned by Alumni and its affiliates, would result in Alumni and its affiliates holding or having beneficial ownership, at any single point in time, of more than 4.99% (9.99% in the case of
Forward Purchase Notices) of the Company’s issued share capital or voting rights in it (unless and until the Company obtains the approval of its shareholders for the issuance of ADSs in excess of such amount), in either case subject to the option to
issue Prefunded Warrants in lieu of ADSs with respect to the sales pursuant to the Initial Purchase Notice or any Regular Purchase Notice.
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The Any Market Purchase Agreement does not include any of the following: (i) limitations on the Company’s use of amounts it receives as the purchase price for the ADSs sold to
Alumni; (ii) financial or business covenants; (iii) restrictions on future financings; (iv) rights of first refusal; or (v) participation rights or penalties.
Pursuant to the Any Market Purchase Agreement, we filed a registration statement covering the resale of 5,596,490 ADSs issued or sold to Alumni under the Any Market Purchase
Agreement under the Securities Act, which was declared effective on July 2, 2025. Alumni has agreed that neither it nor any of its affiliates will engage in any short-selling or hedging of the ADSs during the term of the Any Market Purchase
Agreement.
Nasdaq Minimum Stockholders’ Equity Requirement
On April 15, 2025, we received a written notification (the “Notification Letter”) from the Listing Qualifications Department of Nasdaq Stock Market LLC (“Nasdaq”), notifying us
that we are no longer in compliance with Nasdaq Listing Rule 5550(b)(1) (the “Minimum Stockholders’ Equity Rule”).
The Minimum Stockholders’ Equity requires companies listed on The Nasdaq Capital Market to maintain a minimum of $2,500,000 in stockholders' equity for continued listing. However,
based on our Annual Report on Form 20-F for the fiscal year ended December 31, 2024, filed on April 10, 2025, we reported a stockholders’ deficit of $4,683,000, and we did not meet the alternatives of market value of listed securities or net income
from continuing operations. We were thus non-compliant with the Minimum Stockholders’ Equity Rule.
On December 1, 2025, we announced that we had received confirmation from Nasdaq that we had regained compliance with the Minimum Stockholders’ Equity Rule.
Kukbo Litigation
On September 2, 2022, we filed a lawsuit against Kukbo Co. Ltd. (“Kukbo”) in the Supreme Court of the State of New York, County of New York, Commercial Division, as a result of
Kukbo’s default in delivering to us $5.0 million under a subscription agreement, dated October 25, 2021 (the “Subscription Agreement”), in exchange for the ADSs we were to issue to Kukbo, and in delivering to us the $1.5 million due under the
Exclusive License Agreement. Kukbo thereafter filed counterclaims with various allegations such as breach of contract, misrepresentation, and the breach of the duty of good faith and fair dealing. On November 20, 2023, we entered into a Contingency
Fee Agreement with our legal firm, Haynes and Boone, LLP (“H&B”), under which certain legal costs related to the Kukbo litigation will be assumed by H&B. On December 2, 2024, we were awarded a judgment of approximately $8 million, including
$6.5 million in principal and approximately $1.5 million in accrued interest, plus costs, in a summary judgment by the Supreme Court of the State of New York, New York County in our legal proceedings against Kukbo. The Court dismissed the entirety of
Kukbo’s counterclaims in the case. On August 11, 2025, the New York Supreme Court awarded us approximately $1.82 million in legal costs and expenses (including interest) in our action against Kukbo.
On September 23, 2025, the New York Supreme Court, on appeal, upheld its original summary judgment ruling and award in our favor, unequivocally dismissing, once again, the entirety
of Kukbo’s defense. As of October 27, 2025, the New York Supreme Court’s summary judgment in our favor against Kukbo became final and eligible for enforcement and foreign recognition, with no further appeal permissible following expiry of the appeal
period. The Court awarded more than $10.5 million in total to us, comprised of the main judgment of approximately $8.6 million, now final and eligible for enforcement, and the award for legal fees and expenses of approximately $1.9 million (both
include the principal amounts and accrued interest, to date) which remains subject to an ongoing appeal until March 13, 2026. 9% annual statutory interest continues to accrue on both awards.
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In addition, we won an attachment grant against Kukbo, from Korea’s Incheon District Court, providing a court-ordered seizure (attachment) of Kukbo’s assets, preventing their
disposal prior to judgment enforcement.
We intend to vigorously pursue the recovery of attorneys’ fees and the collection of the judgment.
ATM Program with H.C. Wainwright & Co., LLC
On February 3, 2025, we entered into a sales agreement (the “Wainwright Sales Agreement”) with H.C. Wainwright & Co., LLC (“Wainwright”), for the sale of ADSs, pursuant to
which we are able to offer and sell, from time to time, ADSs through our ATM program, with Wainwright acting as our agent. To date, we have sold 890,001 ADSs at a weighted average offering price of approximately $3.85 per ADS for aggregate net
proceeds of approximately $3.3 million pursuant to the Wainwright Sales Agreement and related prospectus supplement and accompanying base prospectus. Under the prospectus supplements relating to the ATM program and the accompanying base prospectus,
we are permitted to sell ADSs having an aggregate offering price of up to an additional $387,230, from time to time through Wainwright, acting as our agent, in accordance with the Wainwright Sales Agreement.
Implications of Being a Foreign Private Issuer
We are subject to the information reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are applicable to “foreign private issuers,”
and under those requirements we file reports with the United States Securities and Exchange Commission, or SEC. As a foreign private issuer, we are not subject to the same requirements that are imposed upon U.S. domestic issuers by the SEC. Under the
Exchange Act, we are subject to reporting obligations that, in certain respects, are less detailed and less frequent than those of U.S. domestic reporting companies. For example, although we often report our financial results on a quarterly basis, we
are not required to issue quarterly reports, proxy statements that comply with the requirements applicable to U.S. domestic reporting companies, or individual executive compensation information that is as detailed as that required of U.S. domestic
reporting companies. We also have four months after the end of each fiscal year to file our annual reports with the SEC and are not required to file current reports as frequently or promptly as U.S. domestic reporting companies.
Furthermore, our officers, directors and principal shareholders are exempt from the requirements to report transactions in our equity securities and from the short-swing profit
liability provisions contained in Section 16 of the Exchange Act. As a foreign private issuer, we are also not subject to the requirements of Regulation FD (Fair Disclosure) promulgated under the Exchange Act. In addition, as a foreign private
issuer, we are permitted, and follow certain home country corporate governance practices instead of those otherwise required under the listing rules of Nasdaq for domestic U.S. issuers. These exemptions and leniencies reduce the frequency and scope
of information and protections available to you in comparison to those applicable to a U.S. domestic reporting company.
Corporate Information
We were incorporated as a limited liability company under the laws of the State of Israel on August 3, 2009. Our principal executive offices are located at 21 Ha’arba’a Street,
Tel-Aviv, Israel and our telephone number is +972 (3) 541-3131.
The SEC maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. Our website address is http://www.redhillbio.com. Information contained on, or that can be accessed through, our website does not constitute a part of
this prospectus. Our registered agent in the U.S. is Redhill Biopharma Inc., and the address is 8311 Brier Creek Parkway, Suite 105-161, Raleigh, NC 27617, U.S.A.
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Ordinary Shares Currently Outstanding(1)
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50,923,261,000
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ADSs Offered by the Selling Shareholder
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Up to 6,465,559 ADSs representing 64,655,590,000 ordinary shares, comprised of (i) 386,593 ADSs issued as Initial Equity Shares upon execution of the Purchase Agreement, (ii) 590,446 ADSs
issuable upon exercise of the Pre-Funded Warrants issued upon execution of the Purchase Agreement, (iii) 122,130 ADSs issued as Initial Commitment Shares upon execution of the Purchase Agreement, (iv) 366,390 ADSs to be issued as Subsequent
Commitment Shares to YA in three equal installments – on the 90th day, 180th day and 270th day anniversary of the execution of the Purchase Agreement, and (v) 5,000,000 ADSs as the Advance Shares that we have
reserved for issuance and sale to YA as Advance Shares under the Purchase Agreement from time to time.
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Use of Proceeds
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We are not selling any securities under this prospectus and will not receive any of the proceeds from the sale of the ADSs by the Selling Shareholder. We will receive the exercise price of
the Pre-Funded Warrants exercised by YA for cash. Any proceeds received by us from the exercise of the Pre-Funded Warrants will be used for general corporate purposes. For more information on the use of proceeds, see “Use of Proceeds”.
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Risk Factors
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Investing in the ADSs involves a high degree of risk. See “Risk Factors” beginning on page 12 and other information included and incorporated by
reference in this prospectus fora discussion of factors that you should carefully consider before deciding to invest in our securities.
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Nasdaq Listing
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The ADSs are listed on The Nasdaq Capital Market under the symbol “RDHL.”
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(1) The number of ordinary shares outstanding is based on 50,923,261,000 Ordinary Shares as of December 30, 2025. As of December 30, 2025, we had outstanding (i) 23,170,000 Ordinary Shares issuable
upon the exercise of outstanding options to purchase Ordinary Shares at a weighted average exercise price of $0.63 per share (equivalent to 2,317 ADSs at a weighted average exercise price of $6,345.85 per ADS), (ii) 8,082,160,000 Ordinary Shares
issuable upon the exercise of outstanding warrants to purchase Ordinary Shares at a weighted average exercise price of $0.002 per share (equivalent to 808,216 ADSs at a weighted average exercise price of $19.78 per ADS), (iii) 82,201 outstanding
Restricted Share Units (“RSUs”), each RSU representing one ADS.
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Any investment in our securities involves a high degree of risk. You should carefully consider the risks described below and in “Item 3. Key Information—D. Risk
factors” in our Annual Report on Form 20-F for the year ended December 31, 2024, incorporated by reference herein, and all of the information included or incorporated by reference in this prospectus before deciding whether to purchase our securities.
The risks and uncertainties described below or incorporated by reference in this prospectus are not the only risks and uncertainties we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also
impair our business operations. If any of the events or circumstances described in the following risk factors actually occur, our business, financial condition and results of operations would suffer. In that event, the price of our Ordinary Shares
could decline, and you may lose all or part of your investment. The risks discussed below also include forward-looking statements and our actual results may differ substantially from those discussed in these forward-looking statements. See
“Cautionary Statement Regarding Forward-Looking Statements.”
Risks Related to this Offering
It is not possible to predict the actual number of shares we will sell under the Purchase Agreement to YA, or the actual gross proceeds resulting from those
sales.
On December 19, 2025, we entered into the Purchase Agreement with YA, pursuant to which the Selling Shareholder has committed to purchase ADSs for an aggregate purchase price of up
to USD $25 million, subject to certain limitations and conditions set forth in the Purchase Agreement. The ADS that may be issued under the Purchase Agreement may be sold by us to YA at our discretion from time to time during the Commitment Period.
We generally have the right to control the timing and amount of any sales of the ADSs to YA under the Purchase Agreement. Sales of the ADSs, if any, to the Selling Shareholder under the Purchase
Agreement will depend upon market conditions and other factors. We may ultimately decide to sell to YA all, some or none of the ADSs that may be available for us to sell to the Selling Shareholder pursuant to the Purchase Agreement.
Because the purchase price per ADS to be paid by YA for the ADSs that we may elect to sell to YA under the Purchase Agreement, if any, will fluctuate based on the market prices of
the ADSs during the applicable Pricing Period for each purchase made pursuant to the Purchase Agreement, if any, it is not possible for us to predict, as of the date of this prospectus and prior to any such sales, the number of ADSs that we will sell
to YA under the Purchase Agreement, the purchase price per ADS that YA will pay for ADSs purchased from us under the Purchase Agreement, or the aggregate gross proceeds that we will receive from those purchases by YA under the Purchase Agreement, if
any.
Limitations in the Purchase Agreement, including the Ownership Limitation, the availability for issuance of authorized and unissued number of ordinary shares represented by ADSs
and our ability to meet the conditions necessary to deliver an Advance Notice, could prevent us from being able to raise funds up to the Commitment Amount.
Moreover, although the Purchase Agreement provides that we may sell ADSs for an aggregate purchase price of up to an aggregate of USD $25 million to YA, only 6,465,559 ADSs are
being registered for resale by the Selling Shareholder under the registration statement that includes this prospectus, consisting of (i) 5,000,000 ADSs as the Advance Shares that we may elect to sell to YA, in our sole discretion, from time to time
during the Commitment Period, subject to the restrictions and satisfaction of the conditions in the Purchase Agreement, through sales under the Purchase Agreement, (ii) 386,593 ADSs issued as Initial Equity Shares, (iii) 590,446 ADSs issuable upon
exercise of the Pre-Funded Warrants, (iv) 122,130 ADSs issued as Initial Commitment Shares, each issued upon execution of the Purchase Agreement, and (v) 366,390 ADSs to be issued to YA as Subsequent Commitment Shares in three equal installments – on
the 90th day, 180th day and 270th day anniversary of the execution of the Purchase Agreement. Even if we elect to sell to YA all of the shares being registered for resale under this prospectus, depending on the market
prices of the ADSs at the time of such sales, the actual gross proceeds from the sale of all such shares may be substantially less than the USD $25 million Commitment Amount under the Purchase Agreement, which could materially adversely affect our
liquidity. In addition, even if seek to sell to YA all of the shares being registered for resale under this prospectus, we may not have a sufficient number of authorized and unissued ordinary shares represented by ADSs available for issuance to sell
the entire $25 million Commitment Amount under the Purchase Agreement.
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If we desire to issue and sell to the Selling Shareholder under the Purchase Agreement a number of ADSs in excess of the 6,465,559 ADSs being registered for resale under this
prospectus, and the Ownership Limitation and other limitations in the Purchase Agreement would allow us to do so, we would need to file with the SEC one or more additional registration statements to register under the Securities Act the resale by YA
of any such additional ADSs, and the SEC would have to declare such registration statement or statements effective before we could sell additional ADSs.
Any issuance and sale by us under the Purchase Agreement of a substantial amount of ADSs in addition to the ADSs being registered for resale by YA under this prospectus could cause
additional substantial dilution to our shareholders. The number of ADSs ultimately offered for sale by YA is dependent upon the ADSs, if any, we ultimately sell to YA under the Purchase Agreement.
The resale by YA of a significant number of shares registered for resale in this offering at any given time, or the perception that these sales may occur, could cause the market
price of the ADSs to decline and to be highly volatile.
Investors who buy shares at different times will likely pay different prices.
Pursuant to the Purchase Agreement, we will have discretion, subject to market demand, to vary the timing, prices, and numbers of ADSs sold to the Selling Shareholder. If and when
we do elect to sell ADSs to the Selling Shareholder pursuant to the Purchase Agreement, the Selling Shareholder may resell all, some or none of such ADSs at any time or from time to time in its discretion and at different prices. As a result,
investors who purchase ADSs from the Selling Shareholder in this offering at different times will likely pay different prices for those ADSs, and so may experience different levels of dilution and in some cases substantial dilution and different
outcomes in their investment results. Investors may experience a decline in the value of the ADSs they purchase from the Selling Shareholder in this offering as a result of future sales made by us to the Selling Shareholder at prices lower than the
prices such investors paid for their ADSs in this offering.
We will require additional financing to sustain our operations and without it we will not be able to continue operations.
The extent to which we rely on YA as a source of funding will depend on a number of factors, including the prevailing market price of the ADSs, our ability to meet the conditions
necessary to sell ADSs under the Purchase Agreement, the impacts of the Ownership Limitation set forth in the Purchase Agreement and the extent to which we are able to secure funding from other sources. Regardless of the amount of funds we
ultimately raise under the Purchase Agreement, if any, we may seek other sources of funding. Even if we were to sell to the Selling Shareholder the total Commitment Amount under the Purchase Agreement, we may need additional capital to fully
implement our business plan.
Sales and additional issuances of the ADSs or other securities might result in significant dilution and could cause the price of the ADSs to decline.
Pursuant to the Purchase Agreement, we may issue and sell up to 6,465,559 ADSs to YA from time to time, including (i) 386,593 ADSs that we issued to YA as Initial Equity Shares,
(ii) 590,446 ADSs issuable upon exercise of the Pre-Funded Warrants and (iii) 122,130 ADSs that we issued to YA as Commitment Shares, each upon execution of the Purchase Agreement. Sales of substantial number of the ADSs in the public market, or the
perception that such sales might occur, could adversely affect the market price of ADSs and could impair our ability to raise capital through the sale of additional equity securities. We cannot predict if and when YA may sell such ADSs in the public
markets. Pursuant to the Purchase Agreement, we may issue and sell ADSs for an aggregate purchase price of up to USD $25 million to the Selling Shareholder. The timing, frequency, and the price at which we issue the ADSs are subject to market prices
and management’s decision to sell the ADSs, if at all.
As of December 30, 2025, there were 5,092,326 ADSs outstanding, of which 5,051,899 ADSs were held by non-affiliates. The number of ADSs registered for resale covered by this prospectus reflects
approximately the number of ADSs authorized and available for issuance under our articles of association after taking into account ADSs reserved for issuance for other purposes, such as ADSs underlying outstanding warrants and ADSs issuable in
connection with employee and executive compensation. The actual number of ADSs sold to YA pursuant to the Purchase Agreement will depend on the market price of the ADSs at the time of each Advance. If all of the 6,465,559 ADSs offered for resale by
YA under this prospectus were issued and outstanding, such ADSs would represent approximately 55.94% of the total number of ADSs outstanding and approximately 56.14% of the total number of outstanding ADSs held by non-affiliates, in each case as of
December 30, 2025. The Purchase Agreement provides that we may sell up to an aggregate of $25.0 million of ADSs to YA. We have filed the registration statement that includes this prospectus so that we may issue and sell to YA up to 6,465,559 ADSs
from time to time during the Commitment Period, subject to the restrictions and satisfaction of the conditions in the Purchase Agreement, through sales under the Purchase Agreement. Depending on the market prices of the ADSs at the time we elect to
issue such shares to YA under the Purchase Agreement, we may need to sell more ADSs to YA than the number of ADSs registered for resale by YA under this prospectus to receive aggregate gross proceeds equal to the approximately $25.0 million total
commitment of YA under the Purchase Agreement, which could cause additional substantial dilution to our shareholders. The number of shares ultimately offered for resale by YA is dependent upon the number of shares we issue and sell to YA under the
Purchase Agreement. In addition, before we could sell such additional ADSs to YA under the Purchase Agreement, we will be required to file one of more additional registration statements registering the resale of such additional ADSs by YA, which
could cause the price of the ADSs to decline.
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In particular, as a result of the Purchase Agreement, YA is an “underwriter” as such term is defined in Section 2(a)(11) of Securities Act, and the Purchase Agreement contemplates
that YA expects to resell the ADSs we may issue and sell pursuant thereto. Upon effectiveness of this registration statement, YA may resell all, some or none of their ADSs beneficially owned by them from time to time in their discretion and at
different prices, subject to the terms of the Purchase Agreement. Furthermore, we expect that, because there will be a large number of shares registered, YA will continue to offer such covered securities for a significant period of time, the precise
duration of which cannot be predicted. As a result, investors may experience different levels of dilution (and in some cases substantial dilution) and different outcomes in their investment results. Investors may experience a decline in the value of
the shares they purchase as a result of future issuances by the Company, whether to YA or others at prices lower than the prices such investors paid for their shares. In addition, if we issue a substantial number of shares to such parties, or if
investors expect that we will do so, the actual sales of shares or the mere existence of the Purchase Agreement may adversely affect the price of the ADSs or make it more difficult for us to sell equity or equity-related securities in the future at a
desirable time and price, or at all.
To raise capital, we may sell ADSs, ordinary shares, convertible securities or other equity securities in one or more transactions other than those contemplated by the Purchase
Agreement, at prices and in a manner we determine from time to time. We may sell shares or other securities in any other offering at a price per share that is less than the price per share paid by investors in this offering, and investors purchasing
shares or other securities in the future could have rights superior to existing shareholders. The price per share at which we sell additional ADSs, or securities convertible or exchangeable into ADSs, in future transactions may be higher or lower
than the price per share paid by investors in this offering. Any sales of additional shares may dilute our shareholders.
Sales of a substantial number of ADSs in the public market or the perception that these sales might occur could depress the market price of the ADSs and could impair our ability to
raise capital through the sale of additional equity securities. We are unable to predict the effect that sales may have on the prevailing market price of the ADSs. In addition, the sale of substantial numbers of the ADSs could adversely impact their
price.
Limitations under the Purchase Agreement could limit our ability to obtain adequate financing on a timely basis or on acceptable terms in the future.
Pursuant to the Purchase Agreement, we have agreed that from the date of execution of the Purchase Agreement until the earlier of (i) the lapse of 75 days or (ii) the date YA has
resold all of the Initial Equity Shares, we may not effect or enter an agreement to effect any issuance involving a variable rate transaction, including without limitation, pursuant to any existing equity line of credit (including the Any Market
Purchase Agreement) or the under the Wainwright Sales Agreement at prices below the Initial Equity Purchase Price. This provision could make investing in our securities less attractive to investors and could limit our ability to obtain adequate
financing on a timely basis or on acceptable terms in the future, which could have significant harmful effects on our financial condition and business and could include substantial limitations on our ability to continue to conduct operations.
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Risks Related to the ADSs
Our failure to maintain compliance with Nasdaq’s continued listing requirements could result in the delisting of the ADSs.
The ADSs are currently listed for trading on Nasdaq. We must satisfy Nasdaq’s continued listing requirements, including, among other things, a minimum bid price requirement of
$1.00 per ADS and a minimum shareholders’ equity of $2.5 million, or risk delisting, which would have a material adverse effect on our business.
On April 15, 2025, we received the Notification Letter from the Listing Qualifications Department of Nasdaq, notifying us that we are no longer in compliance with Nasdaq Listing
Rule 5550(b)(1). The Minimum Stockholders’ Equity Rule requires companies listed on The Nasdaq Capital Market to maintain a minimum of $2,500,000 in stockholders' equity for continued listing. However, based on our Annual Report on Form 20-F for the
fiscal year ended December 31, 2024, filed on April 10, 2025, we reported a stockholders’ deficit of $4,683,000 and did not meet the alternatives of market value of listed securities or net income from continuing operations, and we were thus
non-compliant with the Minimum Stockholders’ Equity Rule. On December 1, 2025, we announced that we had received confirmation from Nasdaq that we had regained compliance with the Minimum Stockholders’ Equity Rule. There is no guarantee that we will
maintain long-term compliance with the Minimum Stockholders’ Equity Rule.
Previously, on March 11, 2024, we received a letter from Nasdaq indicating that for the thirty consecutive business days prior to March 11, 2024, the bid price for the ADSs had
closed below the minimum $1.00 per ADS requirement for continued listing on Nasdaq under Nasdaq Listing Rule 5450(a)(1). In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we were provided with an initial period of 180 calendar days, or until
September 9, 2024, to regain compliance.
On August 20, 2024, we implemented a ratio change of the ADSs to the Company’s non-traded Ordinary Shares from the previous ratio of one (1) ADS representing four hundred (400)
Ordinary Shares to a new ratio of one (1) ADS representing ten thousand (10,000) Ordinary Shares. For ADS holders, the ratio change had the same effect as a one-for-25 reverse ADS split. On September 3, 2024, we regained compliance with the minimum
bid price requirement under Nasdaq Listing Rule 5550(a)(2) for continued listing on The Nasdaq Capital Market.
However, we may fail to maintain long-term compliance with such minimum bid price requirement and there is no assurance we would be able to successfully implement another ratio
change. Moreover, we previously implemented two ratio changes of the ADSs to the Company’s non-traded Ordinary Shares prior to receiving the letter from Nasdaq in March 2024. If we again fail to comply with such minimum bid price requirement, we may
not be able to again implement a ratio change in compliance with applicable Nasdaq rules in the near term. In the event we are able to implement a ratio change, such ratio change could have the effect of causing us to not comply with other listing
requirements of Nasdaq, such as the listing requirements related to publicly held shares.
Additionally, in the recent past, we did not meet the continued listing requirement for market value of publicly held shares (“MVPHS”), and only regained compliance with such
requirement by transferring the listing of the ADSs to the Nasdaq Capital Market from the Nasdaq Global Market in November 2023. No assurance can be given that the price of the ADSs will not again be in violation of Nasdaq’s minimum bid price
requirement or the MVPHS requirement in the future.
Our failure to meet these requirements may result in our securities being delisted from Nasdaq. A delisting could substantially decrease trading in the ADSs, adversely affect the
market liquidity of the ADSs as a result of the loss of market efficiencies associated with Nasdaq and the loss of federal preemption of state securities laws, adversely affect our ability to obtain financing on acceptable terms, if at all, and may
result in the potential loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities. Additionally, the market price of the ADSs may decline further and shareholders may lose some or all of their
investment.
U.S. holders of ADSs may suffer adverse tax consequences if we were characterized as a passive foreign investment company.
Based on the current composition of our gross income and assets and on reasonable assumptions and projections no assurance can be given that we will not be treated as a passive
foreign investment company (a “PFIC”), for U.S. federal income tax purposes for 2025. If we were characterized as a PFIC, U.S. holders of the ADSs may suffer adverse tax consequences such as (i) having gains realized on the sale of the ADSs treated
as ordinary income rather than capital gain, not qualifying for the preferential rate otherwise applicable to dividends received in respect of the ADSs by individuals who are U.S. holders, and (ii) having interest charges apply to certain
distributions by us and upon certain sales of the ADSs.
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Risks Related to Our Collaboration with Cumberland and Our Minority Sale of Talicia Holdings
We have ceded significant control over the U.S. commercialization of Talicia®. We are dependent in significant part on Cumberland’s performance,
and we are dependent on joint decision-making with Cumberland for the successful commercialization of Talicia® in the U.S. and globally, which may result in disagreements, deadlocks, delays or outcomes that are not in our best interests.
We entered into a collaboration with Cumberland to jointly commercialize Talicia® in the U.S. through Talicia Holdings, our U.S. subsidiary. We also sold a 30% equity interest in
Talicia Holdings to Cumberland. Our future revenues and related cash flows from Talicia® in the U.S., and our ability to realize the anticipated benefits of this arrangement, depends in significant part on Cumberland’s performance and on our ability
to successfully manage a jointly controlled commercialization structure.
Pursuant to the collaboration arrangements, Talicia® will be jointly commercialized in the United States through a Joint Committee with equal representation and joint
decision-making authority over key matters, including commercialization strategy, pricing, contracting, sales and marketing activities. Although we believe joint governance is expected to align incentives, it may also require consensus on significant
decisions. We and Cumberland may have different business objectives, operating priorities, risk tolerances, constraints on resources, views on pricing and contracting, and preferences with respect to promotional strategy, compliance approaches, and
market access initiatives. Disagreements may delay or prevent decisions, cause commercial opportunities to be missed, or result in a compromise position that is less effective than a unified strategy. If disputes arise, available dispute resolution
mechanisms (if any) may be time-consuming, costly, disruptive to commercialization efforts and may not yield results favorable to us. Any such disagreements or deadlocks could materially adversely affect the commercialization of Talicia® in the
United States and globally and our business, financial condition and results of operations.
The division of responsibilities between Talicia Holdings and Cumberland increases operational and supply chain risks, and failures in
coordination could disrupt commercialization.
Under the joint commercialization agreement with Cumberland, Talicia Holdings will oversee market access, marketing, regulatory approvals and medical affairs activities, as well as
manufacturing, quality and supply of Talicia®, bearing the related cost of goods sold. Cumberland will oversee trade operations and distribution and fund significant commercialization activities approved by the Joint Committee. The success of the
U.S. commercialization effort depends on effective coordination across these functions. Operational failures by either party, or failures to coordinate effectively, may result in inventory shortages, excess inventory, product returns, disruptions in
distribution, delays in contracting and payer coverage, inconsistent messaging to customers, operational or compliance errors, or increased expenses. Because Talicia Holdings bears the cost of goods sold, any manufacturing, quality or supply
inefficiencies, delays, or cost increases could disproportionately impact our financial results. In addition, if manufacturing or supply disruptions occur at the same time that demand is increased through Cumberland’s promotional efforts, the
collaboration could be unable to capture market opportunities, which could reduce revenues and damage relationships with customers and distributors.
Our minority sale of Talicia Holdings and joint control structure may limit our ability to unilaterally determine strategy for Talicia® in the
United States and globally, restructure Talicia Holdings, or pursue certain strategic transactions.
By selling a 30% equity interest in Talicia Holdings and agreeing to joint governance arrangements, we reduced our unilateral control over Talicia Holdings and certain strategic
and operational decisions relating to Talicia® in the United States and globally. Under the organizational documents of Talicia Holdings and related agreements, Cumberland has approval rights, board representation, information rights, transfer
restrictions, rights of first refusal or other rights that could restrict or delay our ability to cause Talicia Holdings to take certain actions, including entering into additional collaboration arrangements, changing commercialization strategy,
incurring indebtedness, making certain capital expenditures, or engaging in mergers, acquisitions, sales of assets or other strategic transactions involving Talicia Holdings or Talicia® in the U.S. or globally Even where we retain majority ownership,
joint decision-making may limit our flexibility to respond quickly to market conditions or to implement changes we believe are necessary.
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The structure of our arrangements with Cumberland may create conflicts of interest and may increase the risk of disputes regarding
commercialization strategy, budgets, and interpretation of contractual requirements.
The collaboration contemplates that Cumberland will fund significant commercialization activities approved by the Joint Committee and that the parties will jointly oversee
pricing, contracting and commercial strategy. Disputes could arise over the scope of Joint Committee authority, what expenses are required or reimbursable, whether particular plans were properly approved, and how costs and responsibilities should be
allocated. Disputes could also arise over the use of third parties, vendors, subcontractors and other commercial partners, including whether certain arrangements require consent. Such disputes could result in reduced spending, delays in
commercialization initiatives, interruption of operations, or litigation or arbitration, any of which could negatively affect the commercialization of Talicia® and our results of operations.
If the collaboration is terminated, not renewed or otherwise fails, we may incur substantial costs and face significant delays in maintaining U.S.
commercialization of Talicia® and our business could be materially adversely affected.
The collaboration with Cumberland may be subject to termination or non-renewal in accordance with its terms, including in connection with certain breaches or other events. If the
collaboration is terminated or otherwise fails, we may need to assume responsibilities currently performed by Cumberland, including U.S. sales efforts and trade operations, or identify and transition to a replacement partner. Transitioning
commercialization activities could be time-consuming and expensive. We may need to engage third parties on less favorable terms, and could lead to reduced Talicia® revenues in the United States. In addition, the existence of a minority equity owner
in Talicia Holdings may complicate or delay a transition. Any transition following termination or non-renewal could require significant management attention and may divert time and attention from other strategic priorities, which could impair our
ability to execute our business plan.
Risks Related to Our Business
Any collaborative arrangements that we have established or may establish may not be successful, or we may otherwise not realize the anticipated benefits from
these collaborations, including commercialization of Talicia®. We do not control third parties with whom we have or may have collaborative arrangements, and we rely on such third parties to achieve results which may be significant to us.
In addition, any current or future collaborative arrangements may place the commercialization of Talicia® or products that we may commercialize or promote in the future or the development of our therapeutic candidates outside our control
and may require us to relinquish important rights or may otherwise be on terms unfavorable to us.
Each of our collaborative arrangements requires us to rely on external consultants, advisors, and experts for assistance in several key functions, including clinical development, manufacturing,
regulatory, market research, intellectual property, and commercialization. We do not control these third parties, but we rely on such third parties to achieve results, which may be significant to us. With respect to RHB-102, we rely on Hyloris
Pharmaceuticals NV (“Hyloris”), the party responsible for, among other things, the development, manufacture, registration and commercialization of the product with respect to the territories granted to Hyloris under our exclusive license agreement
with Hyloris, dated as of February 25, 2025. With respect to Talicia® outside the U.S., we rely on Recipharm Strängnäs AB (“Recipharm”) and other contracting parties for the manufacture of Talicia® and its components, and we
rely on Gaelan Medical Trade LLC (“Gaelan Medical”) to obtain necessary approvals and commercialize Talicia® in the United Arab Emirates (“UAE”) and other Middle East markets. With respect to Talicia® in the U.S., we rely on
Cumberland to jointly commercialize Talicia® in the United States through our U.S. subsidiary, Talicia Holding.
Relying upon collaborative arrangements to commercialize Talicia® and any other products that we may commercialize or promote in the future and to develop our
therapeutic candidates, subjects us to a number of risks, including but not limited to the following:
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we will be responsible for making certain milestones, royalty or other payments under our various in-licenses even if our operating costs exceed the revenues generated from the relevant products;
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our collaborators may default on their obligations to us, and we may be forced to either terminate, litigate or renegotiate such arrangements;
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our collaborators may have claims that we breached our obligations to them which may result in termination, renegotiation, litigation or delays in performance of such arrangements;
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we may not be able to control the amount and timing of resources that our collaborators may devote to Talicia®, products that we may commercialize or promote in the future or our therapeutic candidates, including because their
sales force and commercial infrastructure may support multiple products, and they may determine to allocate personnel, management attention, and financial and other resources across products and strategic priorities;
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our collaborators may fail to comply with applicable laws, rules, or regulations when performing services for us, and their commercialization practices may result in investigations, enforcement actions or litigation, as a result of which
we and our subsidiaries could be subject to liability, injunctions, reputational harm and other adverse consequences for such violations;
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our collaborators may experience financial difficulties, making it difficult for them to fulfill their obligations to us, including payment obligations, or they may experience changes in business focus;
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our collaborators’ partners may fail to secure adequate commercial supplies for Talicia® or products that we may commercialize or promote;
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our collaborators’ partners may have a shortage of qualified personnel;
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we may be required to relinquish important rights, such as marketing and distribution rights;
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business combinations or significant changes in a collaborator’s business or business strategy may adversely affect a collaborator’s willingness or ability to complete its obligations under any arrangement;
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under certain circumstances, a collaborator could move forward with a competing therapeutic candidate or commercial product developed either independently or in collaboration with others, including our competitors;
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collaborative arrangements are often terminated or allowed to expire, which may limit or terminate our rights to commercialize Talicia® or products we may commercialize or promote in the future, or could delay the development
and may increase the cost of developing our therapeutic candidates;
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our collaborators may not wish to extend the terms of our agreements related to Talicia® and any future commercial products or therapeutic candidates beyond the existing terms, in which case, we will not have access to existing rights upon
the expiration and will therefore not be able to develop such therapeutic candidates or commercialize or promote such products following the initial terms of our agreements;
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our collaborators may wish to terminate the collaborative arrangements due to any disagreements or conflicts with us, a change in their assessment that the arrangement is no longer valuable, a change in control or in management or in
strategy, changes in product development or business strategies of our collaborators; and
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disputes may arise regarding the scope of the licensed rights and permitted uses of intellectual property, including sublicensing and co-promotion, as a result of which we may be required to enforce our contractual rights through dispute
resolution or litigation, which could be costly and divert management attention.
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In addition, our reliance upon our partners in connection with commercial activities subjects us to a number of additional risks, including but not limited to, the following:
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we do not generally control our partners’ communications with the FDA or other foreign regulatory authorities, and the FDA or other foreign regulatory authorities may determine not to approve or elect to withdraw the products from the
market due to various factors including any action or inaction taken by our partners (see “ – Talicia® or products which we may commercialize or promote in the future may be subject to recalls or market withdrawal that could have
an adverse effect on our reputation, business, financial condition or results of operations”);
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in many instances, we rely on our partners to take enforcement action to protect the IP and regulatory protections, if any, of Talicia® and any future commercial products. Their failure to diligently protect these products could materially
affect our commercial success;
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we rely on our partners to be responsible for the manufacture of Talicia®, including through third-party manufacturers with the requisite quality and manufacturing standards as required under applicable laws and regulations, and
we also rely on those same partners to supply their respective products and active pharmaceutical ingredients (“APIs”), which may result in us having those respective products and APIs in insufficient quantities or not delivered in as timely
a manner as is necessary to achieve adequate or successful promotion and sale of their respective products;
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our partners relating to Talicia® and any future commercial products may significantly create or change reimbursement agreements or increase or decrease the price of their respective products to a level that could adversely affect our
sales or revenues;
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our partners may make decisions related to the product and take critical actions to support the product, including with respect to promotion, sales and marketing, medical affairs and pharmacovigilance, and any action or inaction taken by
those same partners may adversely affect the approval, promotion and sales of their respective commercial products;
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our partners may terminate their agreements with us after an agreed-upon period for reasons set forth in those same partners’ respective agreements with us;
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our partners for future commercial products may change or create new agreements with wholesalers, Pharmacy Benefit Managers or other important stakeholders, which may significantly impact our ability to achieve commercial success, or they
may fail to negotiate reimbursement agreements with payors which could also negatively affect our commercial success;
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our partners may change the price of their respective commercial products to a level that could adversely affect our sales or revenues;
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our partners may not be successful in maintaining or expanding reimbursement from government or third-party payors, such as insurance companies, health maintenance organizations and other health plan administrators, which may adversely
affect the sales of their respective products; and
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our partners, such as Hyloris and Cumberland, may not pursue their activities under our license agreements, or may not be able to develop, manufacture, register and/or commercialize our products, directly or through third parties,
distributors and/or sublicensees.
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If any of these or other scenarios materialize, they could have an adverse effect on our reputation, business, financial condition or results of operations.
We face risks associated with the lawsuit we initiated against Kukbo. Even if we prevail in the lawsuit against Kukbo, we may need to enforce the judgment in
South Korea if Kukbo does not promptly pay the judgment.
On September 2, 2022, we filed a lawsuit against Kukbo in the Supreme Court of the State of New York, County of New York, Commercial Division, as a result of Kukbo’s default in
delivering to us $5.0 million under the Subscription Agreement (as defined herein), in exchange for the ADSs we were to issue to Kukbo, and in delivering to us the further payment of $1.5 million due under the Exclusive License Agreement. Kukbo
thereafter filed counterclaims alleging breach of contract, misrepresentation, and the breach of the duty of good faith and fair dealing. On December 2, 2024, we were awarded a judgment of approximately $6.5 million in principal and approximately
$1.5 million in accrued interest as of the date of the judgment, in a summary judgment by the Supreme Court of the State of New York. The court dismissed the entirety of Kukbo’s counterclaims in the case. On August 11, 2025, the New York Supreme
Court awarded us approximately $1.82 million in legal costs and expenses (including interest) in our action against Kukbo.
On September 23, 2025, the New York Supreme Court, on appeal, upheld its original summary judgment ruling and award in our favor, unequivocally dismissing, once again, the entirety
of Kukbo’s defense. As of October 27, 2025, the New York Supreme Court’s summary judgment in our favor against Kukbo became final and eligible for enforcement and foreign recognition, with no further appeal permissible following expiry of the appeal
period. The Court awarded more than $10.5 million in total to us, comprised of the main judgment of approximately $8.6 million, now final and eligible for enforcement, and the award for legal fees and expenses of approximately $1.9 million (both
include the principal amounts and accrued interest, to date) which remains subject to an ongoing appeal until March 13, 2026. 9% annual statutory interest continues to accrue on both awards
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In addition, RedHill recently won an attachment grant against Kukbo, from Korea’s Incheon District Court, providing a court-ordered seizure (attachment) of Kukbo’s assets,
preventing their disposal prior to judgment enforcement
We are party to a contingency fee agreement with our legal counsel, Haynes and Boone, LLP, entered into on November 20, 2023, as amended on December 29, 2024. Under this agreement,
such firm is entitled to a double-digit percentage of any gross recovery, if and only if the case ends in a final favorable outcome not subject to further appeal. If no collection is made within six months of such an outcome, we are required to pay
such firm its standard hourly fees incurred since entering the agreement—approximately $1.1 million as of December 31, 2024—and must pay the full contingency amount if collection occurs later.
We intend to vigorously pursue the recovery of attorneys’ fees and the collection of the judgment. We can give no assurance that we will succeed in collecting any or all of the
amounts awarded to us. If we are unable to collect in a timely manner, we still will be required to pay the legal fees described above even if we do not receive any recovery. The collection efforts against Kukbo may additionally divert management’s
attention and resources in preparing for any continued litigation and defending our claim, result in disruptions to our business, and require us to pay legal fees, damages, or associated expenses, all of which could adversely affect our ability to
conduct our business.
We conduct some of our operations in Israel. Conditions in Israel, including the recent attack by Hamas and other terrorist organizations from the Gaza Strip
and Israel’s war against them, may affect our operations.
Because we are incorporated under the laws of the State of Israel and some of our operations are conducted in Israel, our business and operations are directly affected by economic,
political, geopolitical and military conditions in Israel. Since the establishment of the State of Israel in 1948, a number of armed conflicts have occurred between Israel and its neighboring countries and terrorist organizations active in the
region. These conflicts have involved missile strikes, hostile infiltrations and terrorism against civilian targets in various parts of Israel, which have negatively affected business conditions in Israel.
In addition, Israel faces many threats from more distant neighbors, in particular, Iran. Parties with whom we do business have sometimes declined to travel to Israel during periods
of heightened unrest or tension, forcing us to make alternative arrangements when necessary. In addition, the political and security situation in Israel may result in parties with whom we have agreements involving performance in Israel claiming that
they are not obligated to perform their commitments under those agreements pursuant to force majeure provisions in such agreements. Any hostilities involving Israel or the interruption or curtailment of trade within Israel or between Israel and its
trading partners could adversely affect our operations or results of operations and could make it more difficult for us to raise capital.
In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched
extensive rocket attacks on Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in extensive deaths, injuries and kidnapping of civilians
and soldiers. Following the attack, Israel’s security cabinet declared war against Hamas and a military campaign against these terrorist organizations commenced in parallel to their continued rocket and terror attacks. In addition, since the
commencement of these events, there have been continued hostilities along Israel’s northern border with Lebanon (with the Hezbollah terror organization) and on other fronts from various extremist groups in the region, such as the Houthis in Yemen and
various rebel militia groups in Syria and Iraq. In October 2024, Israel began limited ground operations against Hezbollah in Lebanon, and in November 2024, a ceasefire was brokered between Israel and Hezbollah. In addition, in April 2024 and October
2024, Iran (in concert with other regional actors) launched direct attacks on Israel involving hundreds of drones and missiles and has threatened to continue to attack Israel and is widely believed to be developing nuclear weapons. Such attacks may
continue due to continuing tensions in the region. In addition, the collapse of the Assad regime in Syria in December 2024 has led to increased instability in the region. Additionally, Yemeni rebel group, the Houthis, launched a series of attacks on
global shipping routes in the Red Sea, causing disruptions of supply chain. On June 12, 2025, Israel conducted a series of air strikes in Iran targeting Iran’s nuclear program and leadership. In the following days, this conflict escalated. On June
21, 2025, U.S. President Donald Trump announced that the United States had conducted air strikes against three nuclear sites within Iran. Any or all of these situations may potentially escalate in the future to more violent events which may affect
Israel and us.
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Although we currently do not expect the ongoing conflict to affect our customers, manufacturing, research and development, supply chain, commercialization activities and current
clinical studies, which are all located in and/or take place outside of Israel, there can be no assurances that further unforeseen events will not have a material adverse effect on us or our operations in the future.
The Israel Defense Force (the “IDF”), the national military of Israel, is a conscripted military service, subject to certain exceptions. Following the October 7, 2023 attacks, the
IDF called up more than 350,000 of its reserve forces to serve. One member of management is currently subject to military service in the IDF and has been called to serve. It is possible that there will be further military reserve duty call-ups in the
future, which may affect our business due to a shortage of skilled labor and loss of institutional knowledge, and necessary mitigation measures we may take to respond to a decrease in labor availability, such as overtime and third-party outsourcing,
for example, may have unintended negative effects and adversely impact our results of operations, liquidity or cash flows.
Additionally, four members of our management team and seven of our non-management employees reside in Israel. Shelter-in-place and work-from-home measures, government-imposed
restrictions on movement and travel and other precautions taken to address the ongoing conflict may temporarily disrupt our management and employees’ ability to effectively perform their daily tasks.
It is currently not possible to predict the duration or severity of the ongoing conflict or its effects on our business, operations and financial conditions. The ongoing conflict
is rapidly evolving and developing, and could disrupt our business and operations, interrupt our sources and availability of supply and hamper our ability to raise additional funds or sell our securities, among others.
Our commercial insurance does not cover losses that may occur as a result of events associated with the security situation in the Middle East. The Israeli government is currently
committed to cover the reinstatement value of direct damages that are caused by terrorist attacks or acts of war. However, there is no assurance that this government coverage will be maintained, or if maintained, will be sufficient to compensate us
fully for damages incurred. Any losses or damages incurred by us could have a material adverse effect on our business.
Several countries, principally in the Middle East, restrict doing business with Israel and Israeli companies, and additional countries may impose restrictions on doing business
with Israel and Israeli companies. In addition, there have been increased efforts by activists to cause companies and consumers to boycott Israeli goods based on Israeli government policies. Such business restrictions and boycotts, particularly if
they become more widespread, may materially and adversely impact our business.
Furthermore, prior to the attacks by Hamas and Iran, the Israeli government was pursuing extensive changes to Israel’s judicial system. This led to protests at various levels
domestically, and investment banks and other investors have voiced concerns that the proposed changes may negatively impact the business environment in Israel. This may, in turn, could slow the flow of international investment and negatively affect
our business, financial condition and prospects.
21
We report under International Financial Reporting Standards as issued by the International Accounting Standards Board and Interpretations. None of the consolidated financial
statements were prepared in accordance with generally accepted accounting principles in the United States.
The term “NIS” refers to New Israeli Shekels, the lawful currency of the State of Israel, the terms “dollar,” “USD $,” “$” or “U.S.” refer to U.S. dollars, the lawful currency of
the United States of America. Our functional and presentation currency is the U.S. dollar. Foreign currency transactions in currencies other than U.S. dollars are translated in this prospectus into U.S. dollars using exchange rates in effect at the
date of the transactions.
We have made rounding adjustments to some of the figures included in this prospectus. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic
aggregation of the figures that preceded them.
All of the ADSs offered by YA pursuant to this prospectus will be sold by YA for its account. We are not selling any securities under this prospectus, and we will not receive any
proceeds from the sale of the ADSs by YA. All net proceeds from the sale of the ADSs covered by this prospectus will go to YA. We expect that the Selling Shareholder will sell its ADSs as described under “Plan of
Distribution.”
We will receive the exercise price of the Pre-Funded Warrants exercised by YA for cash. Any proceeds received by us from the exercise of the Pre-Funded Warrants, if any, will be
used for general corporate purposes.
We have never declared or paid cash dividends to our shareholders. Currently, we do not intend to pay cash dividends on our equity securities in the foreseeable future and intend
to retain all available funds and any future earnings for use in the operation and expansion of our business. We currently intend to reinvest any future earnings, if any, in developing and expanding our business. Any future determination relating to
our dividend policy will be at the discretion of our board of directors and will depend on a number of factors, including future earnings, if any, our financial condition, operating results, contractual restrictions, capital requirements, business
prospects, applicable Israeli law and other factors our board of directors may deem relevant. If we pay any dividends on our ordinary shares, we will pay those dividends, which shall be payable in respect of the ordinary shares underlying the ADSs,
to the Depositary, as the registered holder of such ordinary shares, and the Depositary then will pay such amounts received to the ADS holders in proportion to the ordinary shares underlying the ADSs held by such ADS holders, subject to the terms of
the Deposit Agreement, including net of the fees and expenses payable thereunder and any amounts withheld for taxes or other governmental charges. See the section entitled “Description of American Depositary Shares”
in this prospectus.
22
CAPITALIZATION
The table below sets forth our cash and cash equivalents and our total capitalization (defined as total debt and shareholders’ equity) as of June 30, 2025:
| • |
on an actual basis;
|
| • |
on a pro forma basis to reflect the issuance of 2,247,136 ADSs at a weighted average offering price of approximately $1.48 per ADS for an aggregate of approximately $3.3 million in net proceeds pursuant the Any Market Purchase Agreement
and a $8.1 million gain from the transaction with Cumberland described above (the “Pro Forma Adjustments”); and
|
| • |
on a pro forma as adjusted basis, to give effect to the Pro Forma Adjustment and to (i) the issuance of 386,593 Initial Equity Share and Pre-Funded Warrants to acquire 590,446 ADSs as part of the Initial Equity Issuance, assumed to be
fully exercised into 590,446 ADSs for cash (ii) the issuance of 488,520 ADSs in the aggregate as the Commitment Shares and (iii) the issuance of 5,000,000 ADSs as Advance Shares at an assumed offering price of $1.14 per ADS, which is the last
reported sales price of the ADSs on the Nasdaq on December 26, 2025, after deducting the estimated offering expenses by us.
|
The actual, pro forma and pro forma as adjusted data included in the table below is unaudited. Investors should read this table in conjunction with our audited and unaudited
consolidated financial statements and related notes as of and for the year ended December 31, 2024 and six months ended June 30, 2025, respectively, and management’s discussion and analysis thereon, each as incorporated by reference into this
prospectus, as well as “Use of Proceeds” in this prospectus.
The pro forma as adjusted information below is illustrative only and our capitalization following the completion of this offering is subject to adjustment based on the actual
public offering price of our securities and other terms of this offering determined at pricing.
|
|
As of June 30, 2025
|
|||||||||||
|
|
Actual
|
Pro
Forma
|
Pro Forma
As Adjusted
|
|||||||||
|
|
(in thousands)
|
|||||||||||
|
Total debt (1)
|
$
|
22,787
|
$
|
22,787
|
$
|
22,787
|
||||||
|
Ordinary shares, par value NIS 0.01 per share
|
63,404
|
131,207
|
333,928
|
|||||||||
|
Additional paid-in capital
|
350,303
|
285,801
|
89,710
|
|||||||||
|
Accumulated deficit
|
$
|
(418,119
|
)
|
$
|
(410,040
|
)
|
$
|
410,146
|
||||
|
Total shareholders’ equity
|
(4,412
|
)
|
6,968
|
|
|
13,492
|
||||||
|
Total capitalization and indebtedness
|
$
|
18,375
|
$
|
29,755
|
$
|
36,279
|
||||||
| (1) |
Includes $22.3 million reported as current liabilities, which mainly consist of allowance for deductions from revenue, accrued expenses, accounts payable and derivative financial instruments, and $0.5 million reported as non-current
liabilities, which consist of royalty obligations. The warrants granted in (i) the underwritten offering consummated in December 2022, and (ii) the registered direct offering consummated in January 2024 were classified as a financial
liability due to a net settlement provision. Therefore, some of the proceeds of the issuances were classified as derivative financial instruments and increased the total debt accordingly.
|
As of June 30, 2025, prior to giving effect to this offering, we had outstanding (i) 25,380,000 Ordinary Shares issuable upon the exercise of outstanding options to purchase
Ordinary Shares at a weighted average exercise price of $0.63 per share (equivalent to 2,538 ADSs at a weighted average exercise price of $6,305.93 per ADS), (ii) 8,082,160,000 Ordinary Shares issuable upon the exercise of outstanding warrants to
purchase Ordinary Shares at a weighted average exercise price of $0.002 per share (equivalent to 808,216 ADSs at a weighted average exercise price of $19.78 per ADS), and (iii) 103,243 outstanding RSUs, each RSU representing one ADS.
Unless otherwise stated, outstanding share information throughout this prospectus excludes such outstanding securities and assumes no exercise of the outstanding options or
warrants or vesting or settlement of the outstanding RSUs, as applicable, described above.
23
This prospectus relates to resale from time to time by YA, of up to 6,465,559 ADSs, each ADS representing ten thousand (10,000) Ordinary Shares, issued and that may be issued by us
to YA pursuant to the Purchase Agreement, consisting of (i) 386,593 ADSs issued as Initial Equity Shares upon execution of the Purchase Agreement, (ii) 590,446 ADSs issuable upon exercise of the Pre-Funded Warrants issued upon execution of the
Purchase Agreement, (iii) 122,130 ADSs issued as Initial Commitment Shares upon execution of the Purchase Agreement, (iv) 366,390 ADSs to be issued to YA as Subsequent Commitment Shares in three equal installments – on the 90th day, 180th
day and 270th day anniversary of the execution of the Purchase Agreement, and (v) 5,000,000 ADSs as the Advance Shares that we may elect to sell to YA, in our sole discretion, from time to time during the Commitment Period. We are
registering the ADSs pursuant to the Purchase Agreement in order to permit YA to offer the shares for resale from time to time. For additional information regarding the Purchase Agreement and the issuance of Ordinary Shares covered by this
prospectus, see the section titled “Prospectus Summary—Recent Events—Standby Equity Purchase Agreement with YA” above. Except for the transactions contemplated by the Purchase Agreement or as otherwise
disclosed in this prospectus, YA has not had any material relationship with us within the past three years.
YA is an “underwriter” within the meaning of Section 2(a)(11) of the Securities Act. Any underwriters, broker-dealers or agents that participate in the sale of the ADSs or
interests therein may be “underwriters” within the meaning of Section 2(a)(11) of the Securities Act.
The table below presents information regarding YA and information regarding its beneficial ownership of ADSs. The percentage of beneficial ownership for YA is based on 5,092,326
ADSs outstanding as of December 30, 2025. Beneficial ownership is determined in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment
power with respect to such securities. ADSs subject to warrants currently exercisable, or exercisable within 60 days of December 30, 2025, as well as all ADSs registered herein, are counted as outstanding for computing the holdings of the selling
shareholder holding such options or warrants. YA has sole voting and investment power with respect to the ADSs listed in the table below. The second column lists the number of ADSs beneficially owned by YA based on its ownership of the ADSs as of
December 30, 2025, subject to the beneficial ownership limitations on exercises or conversion, as applicable. The third column lists the ADSs being offered by this prospectus by YA. The fourth column assumes the sale of all of the ADSs offered by YA
pursuant to this prospectus. This table is prepared based on information supplied to us by the Selling Shareholder.
We may not issue or sell any ADSs to YA under Purchase Agreement, and YA will not have the right to exercise any portion of its Pre-funded Warrants for ADSs, if such ADSs, when
aggregated with all other ADSs and ordinary shares then beneficially owned by YA and its affiliates, would exceed the Ownership Limitation.
Information concerning YA may change from time to time and any changed information will be set forth in supplements to this prospectus, if and when necessary.
The Selling Shareholder is not obligated to sell any of the ADSs offered by this prospectus. Because the Selling Shareholder identified in the table below may sell some or all of
the ADSs owned by it that are included in this prospectus, and because there are currently no agreements, arrangements or understandings with respect to the sale of any of such securities, no estimate can be given as to the number of securities
covered by this prospectus that will be held by the Selling Shareholder.
24
The Selling Shareholder may sell all, some or none of their ADSs in this offering. See “Plan of Distribution.”
|
|
ADSs
Beneficially Owned Prior to Offering |
Number
of ADSs Owned After the Offering |
||||||||||||||||||
|
Selling Shareholder
|
Number (1)
|
Percent (2)
|
Maximum Number
of ADSs to be Sold Pursuant to this Prospectus (3) |
Number
|
Percent (3)
|
|||||||||||||||
|
YA II PN, LTD (4)
|
508,723
|
9.99
|
%
|
6,465,559
|
0
|
0
|
%
|
|||||||||||||
| (1) |
This number represents 386,593 ADSs issued to YA as Initial Equity Shares and 122,130 ADSs issued to the YA as Initial Commitment Shares in consideration for entering into the Purchase Agreement with us, in each case issued upon execution
of the Purchase Agreement. In accordance with Rule 13d-3(d) under the Exchange Act, we have excluded from the number of ADSs beneficially owned prior to the offering all of the ADSs that YA may be required to purchase under the Purchase
Agreement, because the issuance of such ADS is solely at our discretion and is subject to conditions contained in the Purchase Agreement, the satisfaction of which are entirely outside of YA’s control, including the registration statement
that includes this prospectus becoming and remaining effective. In accordance with Rule 13d-3(d) under the Exchange Act, we have also excluded the Subsequent Commitment Shares because they will not be issued within 60 days of the date of this
prospectus.
|
| (2) |
The Pre-Funded Warrants to purchase 590,446 ADSs held by YA are subject to a 9.99% blocker according to which YA may not exercise any portion of the Pre-Funded Warrants for ADSs, if such ADSs, when aggregated with all other ADSs and
ordinary shares then beneficially owned by YA and its affiliates, would result in YA and its affiliates beneficially owning more than 9.99% of the then outstanding ADSs.
|
| (3) |
This includes the 488,520 Commitment Shares issued or issuable to YA for which we have not and will not receive any cash proceeds, 386,593 ADSs issued to YA as Initial Equity Shares and 590,446 ADSs issuable upon exercise of the Pre-Funded
Warrants as the Initial Equity Issuance for an aggregate of $1 million. Therefore, only 5,000,000 of such ADSs represent ADSs that we may issue and sell to YA for cash consideration in purchases under the Purchase Agreement from time to time,
at our sole discretion, during the 36-month period following execution of the Purchase Agreement. Depending on the price per ADS at which we sell the Advance Shares to YA pursuant to the Purchase Agreement, we may need to sell to YA under the
Purchase Agreement more ADSs than the resale of which are registered under this prospectus in order to receive aggregate gross proceeds equal to the approximately $25.0 million Commitment Amount under the Purchase Agreement. If we choose to
do so and otherwise satisfy the conditions in the Purchase Agreement, we must first register for resale under the Securities Act such additional ADSs. The number of ADSs ultimately offered for resale by YA is dependent upon the number of ADSs
we sell to YA under the Purchase Agreement. This assumes that YA (i) will sell all of the ADSs beneficially owned by it that are covered by this prospectus and (ii) does not acquire beneficial ownership of any additional ADSs.
|
| (4) |
All investment decisions for YA are made by Mr. Mark Angelo. The business address of YA is 1012 Springfield Avenue, Mountainside, NJ 07092.
|
25
At our extraordinary general meeting of the shareholders held on May 26, 2025, our shareholders approved the increase of our authorized share capital to NIS 1,600,000,000, divided
into (i) 159,994,000,000 registered Ordinary Shares of NIS 0.01 par value each and (ii) 6,000,000 preferred shares of NIS 0.01 par value each.
As of December 30, 2025, there were 50,923,261,000 Ordinary Shares issued and outstanding and no preference shares issued and outstanding. All the Company’s issued and outstanding
shares are fully paid. For a description of our Ordinary Shares and ADSs, see our Annual Report on Form 20-F for the year ended December 31, 2024, including Exhibit 2.3, Description of Share Capital, which is incorporated herein by reference.
Each of the ADSs represents 10,000 Ordinary Shares. The ADSs trade on The Nasdaq Capital Market under the symbol “RDHL.”
The form of the Deposit Agreement for the ADSs and the form of American Depositary Receipt that represents an ADS have been incorporated by reference as exhibits to this
prospectus.
Fees and Expenses
|
Persons depositing or withdrawing shares or
American Depositary Shareholders must pay: |
|
For:
|
|
|
$5.00 (or less) per 100 American Depositary Shares (or portion of 100 American Depositary Shares)
|
|
●
|
Issuance of American Depositary Shares, including issuances resulting from a distribution of shares or rights or other property
|
|
|
|
●
|
Cancellation of American Depositary Shares for the purpose of withdrawal, including if the Deposit Agreement terminates
|
|
$0.05 (or less) per American Depositary Share
|
|
●
|
Any cash distribution to American Depositary Shareholders
|
|
A fee equivalent to the fee that would be payable if securities distributed to you had been shares and the shares had been deposited for issuance of American Depositary Shares
|
|
●
|
Distribution of securities distributed to holders of deposited securities which are distributed by the Depositary to American Depositary Shareholders
|
|
$0.05 (or less) per American Depositary Shares per calendar year
|
|
●
|
Depositary services
|
|
Registration or transfer fees
|
|
●
|
Transfer and registration of shares on our share register to or from the name of the depositary or its agent when you deposit or withdraw shares
|
|
Expenses of the Depositary
|
|
●
|
Cable, telex and facsimile transmissions (when expressly provided in the Deposit Agreement)
|
|
|
|
●
|
Converting foreign currency to U.S. dollars
|
|
Taxes and other governmental charges the Depositary or the custodian have to pay on any American Depositary Share or share underlying an American Depositary Share, for example, stock transfer
taxes, stamp duty or withholding taxes
|
|
●
|
As necessary
|
|
Any charges incurred by the Depositary or its agents for servicing the deposited securities
|
|
●
|
As necessary
|
The Depositary collects its fees for delivery and surrender of American Depositary Shares directly from investors depositing shares or surrendering American Depositary Shares for
the purpose of withdrawal or from intermediaries acting for them. The Depositary collects fees for making distributions to investors by deducting those fees from the amounts distributed or by selling a portion of the distributable property to pay the
fees. The Depositary may collect its annual fee for depositary services by deduction from cash distributions or by directly billing investors or by charging the book-entry system accounts of participants acting for them. The Depositary may generally
refuse to provide fee-attracting services until its fees for those services are paid.
Other material terms and provisions of the ADSs are described under the caption “Description of Share Capital” in this prospectus and are
incorporated herein by reference.
26
History of Share Capital
From February 4, 2025 until the date of this prospectus, we issued 890,001 ADSs to Wainwright under the Wainwright Sales Agreement at a weighted average offering price of $3.85
per ADS for aggregate net proceeds of approximately $3.3 million.
On May 14, 2025, pursuant to an inducement letter we issued to certain investors holding our warrants (the “Existing Warrants”), such investors agreed to exercise for cash their
Existing Warrants to purchase an aggregate of 85,778 ADSs at an exercise price of $1.50 per ADS, reduced from a prior exercise price of $18.75 per ADS.
From July 15, 2025 until the date of this prospectus, we issued 2,247,136 ADSs to Alumni Capital LP pursuant to the Any Market Purchase Agreement, dated June 20, 2025 at a
weighted average offering price of approximately $1.48 per ADS for aggregate gross proceeds of approximately $3.3 million.
On December 19, 2025, we issued (i) 386,593 ADSs issued as Initial Equity Shares and Pre-Funded Warrants to purchase 590,446 ADSs as part of the Initial Equity Issuance and (ii)
122,130 ADSs issued as Initial Commitment Shares pursuant to the Purchase Agreement. N
From January 1, 2022 until the filing of this prospectus, we issued 90,159 ADSs upon the vesting of restricted share units held by our employees, officers, directors and service
providers.
For additional information regarding the history of changes to our share capital since December 1, 2022, please see “Management’s Discussion
and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources – Financing Activities” in our Annual Report on Form 20-F filed with the SEC on April 10, 2025.
The offers, sales and issuances of the securities described in the preceding paragraphs were exempt from registration under Section 4(a)(2) of the Securities Act and the rules
and regulations promulgated thereunder (including Regulation D and Rule 506), in that the transactions were between an issuer and sophisticated investors or members of its senior executive management and did not involve any public offering within the
meaning of Section 4(a)(2).
27
The following table sets forth the estimated costs and expenses payable by the registrant expected to be incurred in connection with the registration of the ADSs being registered
hereby:
|
EXPENSES
|
AMOUNT
|
|||
|
SEC registration fee
|
$
|
892.89
|
||
|
Legal fees and expenses
|
100,000
|
|||
|
Accounting fees and expenses
|
10,000
|
|||
|
Miscellaneous
|
64,655.59
|
|||
|
Total
|
$
|
175,548.48
|
||
All amounts in the table are estimates except the SEC registration fee. The Company will pay all of the expenses of this offering.
28
On December 19, 2025, we entered into the Purchase Agreement with YA. The Purchase Agreement provides that, upon the terms and subject to the conditions set forth therein, YA is
committed to purchase up to $25.0 million in ADSs during the Commitment Period. From time to time, and at our sole discretion, we may present YA with Advance Notices to purchase the ADSs. The ADSs would be purchased pursuant to the Purchase Agreement
at a price per ADS price equal to, at our election, (i) 95% of the VWAP of the ADSs on the applicable trading day of delivery of such Advance Notice or (ii) 97% of the lowest daily VWAP for the three consecutive trading days commencing on the day
such Advance Notice is deemed delivered.
The ADSs offered by this prospectus are being offered by the Selling Shareholder. The Selling Shareholder is an “underwriter” within the meaning of Section 2(a)(11) of the
Securities Act. We have agreed in the Purchase Agreement to provide customary indemnification to YA.
It is possible that our shares may be sold from time to time by YA in one or more of the following manners:
|
|
●
|
ordinary brokers’ transactions;
|
|
|
●
|
transactions involving cross or block trades;
|
|
|
●
|
through brokers, dealers, or underwriters who may act solely as agents;
|
|
|
●
|
“at the market” into an existing market for our common stock;
|
|
|
●
|
in other ways not involving market makers or established business markets, including direct sales to purchasers or sales effected through agents;
|
|
|
●
|
in privately negotiated transactions; or
|
|
|
●
|
any combination of the foregoing.
|
In order to comply with the securities laws of certain states, if applicable, the ADSs may be sold only through registered or licensed brokers or dealers. In addition, in certain
states, the ADSs may not be sold unless they have been registered or qualified for sale in the state or an exemption from the state’s registration or qualification requirement is available and complied with.
YA has agreed that, during the term of the Purchase Agreement, neither YA or its affiliates will engage in any short sales or hedging transactions with respect to the ADSs,
provided that YA and its affiliates may enter into Permitted Sales.
We have advised YA that it is required to comply with Regulation M promulgated under the Exchange Act. With certain exceptions, Regulation M precludes the Selling Shareholder, any
affiliated purchasers, and any broker-dealer or other person who participates in the distribution from bidding for or purchasing, or attempting to induce any person to bid for or purchase any security which is the subject of the distribution until
the entire distribution is complete. Regulation M also prohibits any bids or purchases made in order to stabilize the price of a security in connection with the distribution of that security. All of the foregoing may affect the marketability of the
securities offered by this prospectus.
We will pay the expenses incident to the registration under the Securities Act of the offer and sale of the ADSs covered by this prospectus by the Selling Shareholder. We estimate
that our total expenses for the offering will be approximately $0.2 million (excluding the Commitment Shares). As consideration for its irrevocable commitment to purchase the ADSs under the Purchase Agreement, we agreed to issue the Commitment Shares
to the Selling Shareholder, calculated as 2% of the Commitment Amount.
29
Certain legal matters with respect to Israeli law and with respect to the validity of the offered securities under Israeli law will be passed upon for us by Goldfarb Gross Seligman
& Co. Certain legal matters with respect to U.S. federal securities law and New York law will be passed upon for us by Haynes and Boone, LLP.
The financial statements incorporated in this prospectus by reference to the Annual Report on Form 20-F for the year ended December 31, 2024 have been so incorporated in reliance
on the report of Kesselman & Kesselman, Certified Public Accountants (Isr.) (which includes an explanatory paragraph regarding the existence of substantial doubt about the Company’s ability to continue as a going concern as described in Note
1(a)(3) to the financial statements), a member firm of PricewaterhouseCoopers International Limited, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
We are incorporated under the laws of the State of Israel. Service of process upon us and upon our directors and officers and the Israeli experts named in this prospectus, many of
whom reside outside the United States, may be difficult to obtain within the United States. Furthermore, because many of our assets and most of our directors and officers are located outside the United States, any judgment obtained in the United
States against us or any of our directors and officers may not be collectible within the United States.
It may be difficult to assert U.S. securities law claims in original actions instituted in Israel. Israeli courts may refuse to hear a claim based on a violation of U.S. securities
laws because Israel is not the most appropriate forum to bring such a claim. In addition, even if an Israeli court agrees to hear a claim, it may determine that Israeli law and not U.S. law is applicable to the claim. If U.S. law is found to be
applicable, the content of applicable U.S. law must be proved as a fact which can be a time-consuming and costly process. Certain matters of the procedure will also be governed by Israeli law.
Subject to specified time limitations and legal procedures, Israeli courts may enforce a United States judgment in a civil matter which, subject to certain exceptions, is
non-appealable, including judgments based upon the civil liability provisions of the Securities Act and the Exchange Act and including a monetary or compensatory judgment in a non-civil matter, provided that:
| • |
the judgments are obtained after due process before a court of competent jurisdiction, according to the laws of the state in which the judgment is given and the rules of private international law currently prevailing in Israel;
|
| • |
the prevailing law of the foreign state in which the judgments were rendered allows the enforcement of judgments of Israeli courts (however, the Israeli courts may waive this requirement following a request by the attorney general);
|
| • |
adequate service of process has been effected and the defendant has had a reasonable opportunity to be heard and to present his or her evidence;
|
| • |
the judgments are not contrary to public policy, and the enforcement of the civil liabilities set forth in the judgment does not impair the security or sovereignty of the State of Israel;
|
| • |
the judgments were not obtained by fraud and do not conflict with any other valid judgment in the same matter between the same parties;
|
| • |
an action between the same parties in the same matter is not pending in any Israeli court at the time the lawsuit is instituted in the foreign court; and
|
| • |
the obligations under the judgment are enforceable according to the laws of the State of Israel and according to the law of the foreign state in which the relief was granted.
|
We have irrevocably appointed RedHill Biopharma Inc. as our agent to receive service of process in any action against us in any United States federal or state court arising out of
this offering or any purchase or sale of securities in connection with this offering.
If a foreign judgment is enforced by an Israeli court, it generally will be payable in Israeli currency, which can then be converted into non-Israeli currency and transferred out
of Israel. The usual practice in an action before an Israeli court to recover an amount in a non-Israeli currency is for the Israeli court to issue a judgment for the equivalent amount in Israeli currency at the rate of exchange in force on the date
of the judgment, but the judgment debtor may make payment in foreign currency. Pending collection, the amount of the judgment of an Israeli court stated in Israeli currency ordinarily will be linked to the Israeli consumer price index plus interest
at the annual statutory rate set by Israeli regulations prevailing at the time. Judgment creditors must bear the risk of unfavorable exchange rates.
30
We have filed with the U.S. Securities and Exchange Commission a registration statement (including amendments and exhibits to the registration statement) on Form F-1 under the
Securities Act. This prospectus, which is part of the registration statement, does not contain all of the information set forth in the registration statement and the exhibits and schedules to the registration statement. The rules and regulations of
the SEC allow us to omit certain information from this prospectus that is included in the registration statement. For further information, we refer you to the registration statement and the exhibits and schedules filed as part of the registration
statement. If a document has been filed as an exhibit to the registration statement, we refer you to the copy of the document that has been filed. Each statement in this prospectus relating to a document filed as an exhibit is qualified in all
respects by the filed exhibit.
We are subject to the informational requirements of the Exchange Act. Accordingly, we are required to file reports and other information with the SEC, including annual reports on
Form 20-F and reports on Form 6-K. The SEC maintains an Internet website that contains reports and other information about issuers, like us, that file electronically with the SEC. The address of that website is www.sec.gov. Our
website address is http://www.redhillbio.com. Information contained on, or that can be accessed through, our website does not constitute a part of this prospectus.
As a foreign private issuer, we are exempt under the Exchange Act from, among other things, the rules prescribing the furnishing and content of proxy statements, and our directors,
executive officers and principal shareholders are exempt from the reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act.
We file or furnish annual reports and reports of foreign private issuer and other information with the SEC. These filings and other submissions contain important information that
does not appear in this prospectus. The SEC allows us to incorporate by reference information into this document. This means that we can disclose important information to you by referring you to another document filed separately with the SEC. The
information incorporated by reference is considered to be a part of this document, except for any information superseded by information that is included directly in this prospectus.
We incorporate by reference the following documents or information that we have filed with the SEC:
|
|
●
|
the description of the ADSs and our Ordinary Shares contained in Exhibit 2.3 to our Annual Report on Form
20-F for the fiscal year ended December 31, 2024, filed with the SEC on April 10, 2025;
|
|
|
|
|
|
|
●
|
our Annual Report on Form 20-F for the fiscal year ended December 31, 2024, filed with the SEC on April
10, 2025; and
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our Reports of Foreign Private Issuer on Form 6-K furnished to the SEC on January 21, 2025, February 3, 2025, February 4, 2025, February 25, 2025, February 27, 2025, March 12, 2025, March 18, 2025, March 26, 2025, April 1, 2025, April 8, 2025, April 16, 2025, April 17, 2025, April 28, 2025, May 2, 2025, May 5, 2025, May 13, 2025, May 19, 2025, May 27, 2025, June 25, 2025, July 1, 2025, July 21, 2025, August 14, 2025, August 18, 2025 (not including
second paragraph of press release), August 20, 2025, September
29, 2025, October 6, 2025, October 20, 2025,
October 21, 2025, October 22, 2025, November 4, 2025, November 26, 2025, December 1, 2025, December 15, 2025, December 23, 2025 and December 31, 2025, and Form
6-K/A furnished to the SEC on September 5, 2025 (in each case only to the extent provided in such Form 6-K).
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The information relating to us contained in this prospectus does not purport to be comprehensive and should be read together with the information contained in the documents incorporated or deemed to be
incorporated by reference in this prospectus.
You should rely only on the information incorporated by reference or provided in this prospectus. We have not authorized anyone else to provide you with different information. You
should not assume that the information in this prospectus is accurate as of any date other than the date of this prospectus or the date of the documents incorporated by reference in this prospectus. As you read the above documents, you may find
inconsistencies in information from one document to another. If you find inconsistencies between the documents and this prospectus, you should rely on the statements made in the most recent document. All information appearing in this prospectus is
qualified in its entirety by the information and financial statements, including the notes thereto, contained in the documents incorporated by reference herein.
We will provide you without charge, upon your written or oral request, a copy of any of the documents incorporated by reference in this prospectus, other than exhibits to such
documents which are not specifically incorporated by reference into such documents. Please direct your written or telephone requests to RedHill Biopharma Ltd., 21 Ha’arba’a Street, Tel Aviv 6473921, Israel, Attn: Dror Ben-Asher, telephone number:
+972 (3) 541-3131. You may also obtain information about us by visiting our website at www.redhillbio.com. Information contained in our website is included as an inactive textual reference only and is not
part of this prospectus. The SEC maintains an Internet site, http://www.sec.gov, that contains reports, proxy and information statements, and other information regarding issuers that file electronically with
the SEC.
31
REDHILL BIOPHARMA LTD.
UP TO 6,465,559 AMERICAN DEPOSITARY SHARES REPRESENTING 64,655,590,000 ORDINARY SHARES
PROSPECTUS
, 2025
PART II
Information Not Required in the Prospectus
Item 6. Indemnification of Directors and Officers
Exemption, Insurance, and Indemnification of Directors and Officers
Exemption of Officers and Directors
Under the Israeli Companies Law, a company may not exempt an officer or director from liability with respect to a breach of his duty of loyalty, but may exempt in advance an
officer or director from liability to the company, in whole or in part, with respect to a breach of his duty of care, except in connection with a prohibited distribution made by the company, if so provided in its articles of association. Our articles
of association provide for this exemption from liability for our directors and officers.
Directors’ and Officers’ Insurance
The Israeli Companies Law and our articles of association provide that, subject to the provisions of the Israeli Companies Law, we may obtain insurance for our directors and
officers for any liability stemming from any act performed by an officer or director in his capacity as an officer or director, as the case may be with respect to any of the following:
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a breach of such officer’s or director’s duty of care to us or to another person;
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a breach of such officer’s or director’s duty of loyalty to us, provided that such officer or director acted in good faith and had reasonable cause to assume that his act would not prejudice our interests;
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a financial liability imposed upon such officer or director in favor of another person;
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financial liability imposed on the officer or director for payment to persons or entities harmed as a result of violations in administrative proceedings as described in Section 52(54)(a)(1)(a) of the Israeli Securities Law (“Party Harmed
by the Breach”);
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expenses incurred by such officer or director in connection with an administrative proceeding conducted in this matter, including reasonable litigation expenses, including legal fees; or
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a breach of any duty or any other obligation, to the extent insurance may be permitted by law.
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Pursuant to the Compensation Policy, we may obtain a directors’ and officers’ liability insurance policy, which would apply to our or our subsidiaries’ directors and officers, as
they may be, from time to time, subject to the following terms and conditions: (a) the total insurance coverage under the insurance policy may not exceed $100 million; and (b) the purchase of such policy must be approved by the Compensation Committee
(and, if required by law, by the board of directors) which shall determine that such policy reflects the current market conditions and that it does not materially affect the Company's profitability, assets or liabilities. In addition, pursuant to our
Compensation Policy, should we sell our operations (in whole or in part) or in case of a merger, spin-off or any other significant business combination involving us or part or all of our assets, we may obtain a director’s and officers’ liability
insurance policy (run-off) for our directors and officers in office with regard to the relevant operations, subject to the following terms and conditions: (a) the insurance term may not exceed seven years; (b) the coverage amount may not exceed $100
million; and (c) the purchase of such policy must be approved by the Compensation Committee (and, if required by law, by the board of directors) which shall determine that such policy reflects the current market conditions and that it does not
materially affect the Company's profitability, assets or liabilities. The Compensation Policy is in effect for three years from the May 2025 annual general meeting.
Pursuant to the foregoing approvals, we carry directors’ and officers’ liability insurance. This insurance is renewed on an annual basis.
II - 1
Indemnification of Officers and Directors
The Israeli Companies Law provides that a company may indemnify an officer or director for payments or expenses associated with acts performed in his capacity as an officer or
director of the company, provided the company’s articles of association include the following provisions with respect to indemnification:
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a provision authorizing the company to indemnify an officer or director for future events with respect to a monetary liability imposed on him in favor of another person pursuant to a judgment (including a judgment given in a settlement or
an arbitrator’s award approved by the court), so long as such indemnification is limited to types of events which, in the board of directors’ opinion, are foreseeable at the time of granting the indemnity undertaking given the company’s
actual business, and in such amount or standard as the board of directors deems reasonable under the circumstances. Such undertaking must specify the events that, in the board of directors’ opinion, are foreseeable in view of the company’s
actual business at the time of the undertaking and the amount or the standards that the board of directors deemed reasonable at the time;
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a provision authorizing the company to indemnify an officer or director for future events with respect to reasonable litigation expenses, including counsel fees, incurred by an officer or director in which he is ordered to pay by a court,
in proceedings that the company institutes against him or instituted on behalf of the company or by another person, or in a criminal charge of which he was acquitted, or a criminal charge in which he was convicted of a criminal offense that
does not require proof of criminal intent;
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a provision authorizing the company to indemnify an officer or director for future events with respect to reasonable litigation fees, including attorney’s fees, incurred by an officer or director due to an investigation or proceeding filed
against him by an authority that is authorized to conduct such investigation or proceeding, and that resulted without filing an indictment against him and without imposing on him financial obligation in lieu of a criminal proceeding, or that
resulted without filing an indictment against him but with imposing on him a financial obligation as an alternative to a criminal proceeding in respect of an offense that does not require the proof of criminal intent or in connection with a
monetary sanction;
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a provision authorizing the company to indemnify an officer or director for future events with respect to a Party Harmed by the Breach;
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a provision authorizing the company to indemnify an officer or director for future events with respect to expenses incurred by such officer or director in connection with an administrative proceeding, including reasonable litigation
expenses, including legal fees; and
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a provision authorizing the company to indemnify an officer or director retroactively.
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Limitations on Insurance, Exemption and Indemnification
The Israeli Companies Law and our articles of association provide that a company may not exempt or indemnify a director or an officer nor enter into an insurance contract, which
would provide coverage for any monetary liability incurred as a result of any of the following:
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a breach by the officer or director of his duty of loyalty, except for insurance and indemnification where the officer or director acted in good faith and had a reasonable basis to believe that the act would not prejudice the company;
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a breach by the officer or director of his duty of care if the breach was done intentionally or recklessly, except if the breach was solely as a result of negligence;
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any act or omission done with the intent to derive an illegal personal benefit; or
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any fine, civil fine, monetary sanctions, or forfeit imposed on the officer or director.
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In addition, under the Israeli Companies Law, exemption of, indemnification of, and procurement of insurance coverage for, our directors and officers must be approved by our audit
committee and board of directors and, in specified circumstances, by our shareholders.
II - 2
Letters of Indemnification
We may provide a commitment to indemnify in advance any director or officer of ours in the course of such person’s position as our director or officer, all subject to the letter of
indemnification, as approved by our shareholders from time to time and in accordance with our articles of association. We may provide retroactive indemnification to any officer to the extent allowed by the Israeli Companies Law. As approved by our
shareholders on May 13, 2022, the amount of the advance indemnity is limited to the higher of 25% of our then shareholders’ equity, per our most recent annual financial statements, or $10 million.
As part of the indemnification letters, we exempted our directors and officers, in advance, to the extent permitted by law, from any liability for any damage incurred by them,
either directly or indirectly, due to the breach of an officer’s or director’s duty of care vis-à-vis us, within his acts in his capacity as an officer or director. The letter provides that so long as not permitted by law, we do not exempt an officer
or director in advance from his liability to us for a breach of the duty of care upon distribution, to the extent applicable to the officer or director, if any. The letter also exempts an officer or director from any liability for any damage incurred
by him, either directly or indirectly, due to the breach of the officer or director’s duty of care vis-à-vis us, by his acts in his capacity as an officer or director prior to the letter of exemption and indemnification becoming effective.
Item 7. Recent Sales of Unregistered Securities
On March 8, 2023, we issued to a single investor a convertible promissory note in the principal amount of up to $6 million and a warrant to purchase up to 2,380 ADSs in a
private placement. We received an advance of $2 million under the note. On March 28, 2023, we entered into a termination agreement with the investor, cancelling the convertible promissory note and warrant, and we paid $2,030,000 to the investor.
On July 25, 2023, in connection with a registered direct offering (the “July 2023 Offering”), we entered into a warrant reprice and reload letter with a certain holder of our
Series A Warrants to purchase up to an aggregate of 60,000 ADSs and Series B Warrants to purchase up to an aggregate of 60,000 ADSs, each issued in March 2023, pursuant to which such holder exercised its Series A Warrants in full at a reduced
exercise price of $33.75 per ADS in exchange for new unregistered warrants to purchase up to an aggregate of 60,000 ADSs at an exercise price of $45.00 per ADS exercisable until April 3, 2028 and a reduction in the exercise price of various
outstanding warrants (the “July 2023 Warrant Exercise Transaction”). The gross proceeds to us from the warrant reprice and reload letter were approximately $2,025,000, before deducting the placement agent’s fees and other offering expenses payable by
us.
In September 2023, in connection with the Company’s warrant exercise transaction (the “September 2023 Warrant Exercise Transaction”) and pursuant to an inducement letter,
certain investors agreed to exercise for cash their existing warrants to purchase an aggregate of 172,076 ADSs issued on May 11, 2022, December 6, 2022, April 3, 2023 and July 25, 2023, at reduced exercise price of $11.75 per ADS, in consideration
for the issuance to each such exercising investor of new warrants to purchase up to an aggregate of 344,154 ADSs at an exercise price of $11.75 per ADS with exercise terms ranging from eighteen months to five years.
On January 26, 2024, in connection with a registered direct offering (the “January 2024 Offering”), we concurrently issued to certain institutional investors unregistered
warrants to purchase 400,000 ADSs. The Warrants have an exercise price of $25.00 per ADS, are exercisable immediately and will expire five years from the date of issuance. The gross proceeds to us from the transaction were approximately $8 million,
before deducting the placement agent’s fees and other offering expenses payable by us.
In addition, we issued (i) warrants to purchase up to 3,125 ADSs issued to the placement agent as part of the compensation to the placement agent in connection with the July
2023 Offering, (ii) the issuance of warrants to purchase up to 3,600 ADSs issued to the placement agent as part of the compensation to the placement agent in connection with the July 2023 Warrant Exercise Transaction, (iii) the issuance of warrants
to purchase up to an aggregate of 10,324 ADSs issued to the placement agent as part of the compensation in connection with the September 2023 Warrant Exercise Transaction and (iv) the issuance of warrants to purchase up to 24,000 ADSs issued to the
placement agent’s designees as partial compensation to the placement agent in connection with the January 2024 Offering. We also issued warrants to purchase up to 3,600 ADSs to the placement agent as part of the compensation paid to the placement
agent in connection with a registered direct offering that closed on March 30, 2023.
Pursuant to the Purchase Agreement, on December 19, 2025, the Company issued (i) 386,593 ADSs issued as Initial Equity Shares and Pre-Funded Warrants to purchase 590,446 ADSs as
part of the Initial Equity Issuance and (ii) 122,130 ADSs issued as Initial Commitment Shares in private placements. For more information about the Purchase Agreement, see “Prospectus Summary—Recent Events—Standby
Equity Purchase Agreement with YA” above.
Pursuant to the Any Market Purchase Agreement, dated June 20, 2025 with Alumni, we have issued to date 2,247,136 ADSs at a weighted average offering price of approximately $1.48
per ADS for aggregate net proceeds of approximately $3.3 million. For additional information regarding the issuance of Ordinary Shares covered by this prospectus, see the section titled “Prospectus Summary—Recent
Events—Equity Line of Credit”.
For additional information regarding the unregistered securities sold since January 2023, please see “Item 5. Operating and Financial Review
and Prospects – Liquidity and Capital Resources” in our Annual Report on Form 20-F for the year ended December 31, 2024.
The offers, sales and issuances of the securities described in the preceding paragraphs were exempt from registration under Section 4(a)(2) of the Securities Act and the rules
and regulations promulgated thereunder (including Regulation D and Rule 506), in that the transactions were between an issuer and sophisticated investors or members of its senior executive management and did not involve any public offering within the
meaning of Section 4(a)(2).
II - 3
Item 8. Exhibits
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The following documents are filed as part of this registration statement:
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See the Exhibit Index attached to this registration statement, which is incorporated by reference herein.
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Financial Statement Schedules
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None.
Item 9. Undertakings
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The undersigned registrant hereby undertakes:
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To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
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To include any prospectus required by Section 10(a)(3) of the Securities Act;
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To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more
than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Filing Fee Tables” or “Calculation of Registration Fee” table, as applicable, in the effective registration statement; and
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To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
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That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering thereof;
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To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering;
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To file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial
statements and information otherwise required by Section 10(a)(3) of the Securities Act need not be furnished, provided that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements
required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements.
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That, for the purpose of determining liability under the Securities Act to any purchaser:
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If the registrant is relying on Rule 430B (§ 230.430B of this chapter):
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each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
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each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of
providing the information required by section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or
the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed
to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide
offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that
was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date;
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If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses
filed in reliance on Rule 430A (§ 230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however,
that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of
the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration
statement or made in any such document immediately prior to such date of first use.
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Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
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II - 4
EXHIBIT INDEX
The following documents are filed as part of this registration statement:
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II - 5
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II - 6
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* Filed herewith.
^ Indicates management contract or compensatory plan.
+ Confidential treatment granted with respect to certain portions of this exhibit.
† Certain identified confidential information in this exhibit has been omitted because such identified confidential information is (i) the type the Company treats as private or confidential and (ii)
is not material. A copy of the omitted portions will be furnished to the SEC upon its request.
II - 7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on
Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Tel Aviv, Israel, on December 31, 2025.
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REDHILL BIOPHARMA LTD.
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By:
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/s/ Dror Ben-Asher
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Name: Dror Ben-Asher
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Title: Chief Executive Officer and Chairman of the
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Board of Directors
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By:
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/s/ Razi Ingber
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Name: Razi Ingber
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Title: Chief Financial Officer
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II - 8
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Dror Ben-Asher and Razi Ingber and each of them, individually, as
his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead in any and all capacities, in connection with this registration statement, including to sign in the name
and on behalf of the undersigned, this registration statement and any and all amendments thereto, including post-effective amendments and registrations filed pursuant to Rule 462 under the U.S. Securities Act of 1933, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the U.S. Securities and Exchange Commission, granting unto such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or his substitute, may lawfully do or cause to be done
by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.
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Signature
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Title
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Date
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/s/ Dror Ben-Asher
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Chief Executive Officer and Chairman of the Board of Directors
(Principal Executive Officer)
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December 31,
2025
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Dror Ben-Asher
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/s/ Razi Ingber
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Chief Financial Officer
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December 31,
2025
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Razi Ingber
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(Principal Financial Officer and Principal Accounting Officer)
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/s/ Shmuel Cabilly
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Director
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December 31,
2025
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Dr. Shmuel Cabilly
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/s/ Roni Mamluk
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Director
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December 31,
2025
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Dr. Roni Mamluk
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/s/ Kenneth Reed
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Director
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December 31,
2025
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Dr. Kenneth Reed
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/s/ Ofer Tsimchi
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Director
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December 31,
2025
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Ofer Tsimchi
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/s/ Rick Scruggs
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Chief Commercial Officer and Director
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December 31,
2025
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Rick Scruggs
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II - 9
AUTHORIZED REPRESENTATIVE
Pursuant to the requirements of Section 6(a) of the Securities Act of 1933, the undersigned has signed this Registration Statement on Form F-1, solely in the capacity of the duly
authorized representative of RedHill Biopharma Ltd. in the United States, on December 31, 2025.
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REDHILL BIOPHARMA INC.
Authorized U.S. Representative
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By: /s/ Razi Ingber
Name: Razi Ingber
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II - 10
Exhibit 5.1
Tel Aviv, December 31, 2025
RedHill Biopharma Ltd.
21 Ha’arba’a Street
Tel Aviv, 6473921
Israel
Re: Registration Statement on Form F-1
Ladies and Gentlemen:
We have acted as special Israeli counsel to RedHill Biopharma Ltd., a company organized under the laws of the State of Israel
(the “Company”), in connection with the preparation and filing of a Registration Statement on Form F-1 (the “Registration Statement”) under the Securities Act of 1933, as amended (the “Securities Act”), to be filed with the Securities and Exchange Commission (the “Commission”). The Registration Statement
relates to the proposed resale by the selling shareholder named in the Registration Statement (the “Selling Shareholder”) of up to
6,465,559 American Depositary Shares (the “ADSs”), each representing 10,000 ordinary shares, no par value per share (the “Ordinary Shares”), of the Company in the aggregate, comprised of (i) 122,130 ADSs (the “Initial Commitment Shares”) issued to the Selling Shareholder as consideration for the
Selling Shareholder’s irrevocable commitment to purchase the ADSs pursuant to a Standby Equity Purchase Agreement, dated December 19, 2025, between the Company and the Selling Shareholder (the “Purchase Agreement”), (ii) 366,390 ADSs (the “Subsequent Commitment Shares”)
to be issued to the Selling Shareholder as consideration for the Selling Shareholder’s irrevocable commitment to purchase the ADSs pursuant to the Purchase Agreement, (iii) 5,000,000 ADSs that may be issued from time to time by the Company to
the Selling Shareholder pursuant to the Purchase Agreement (the “Advance Shares”), as described in the Registration Statement and the
prospectus contained therein, (iv) 386,593 ADSs issued to the Selling Shareholder on the date of execution of the Purchase Agreement (the “Initial
Equity Shares”) and (v) 590,446 ADSs (the “Warrant ADSs”) issuable to the Selling Shareholder upon exercise of pre-funded warrants
to purchase Ordinary Shares represented by ADSs, issued by the Company to the Selling Shareholder on the date of execution of the Purchase Agreement, all as described in the Registration Statement and the prospectus contained therein.
We have acted as special Israeli counsel to RedHill Biopharma Ltd., a company organized under the laws of the State of Israel (the
“Company”), in connection with the preparation and filing of a Registration Statement on Form F-1 (the “Registration Statement”) under the Securities Act of 1933, as amended (the “Securities Act”), to be filed with the Securities and Exchange Commission (the “Commission”). The Registration Statement
relates to the proposed resale by the selling shareholder named in the Registration Statement (the “Selling Shareholder”) of up to 6,465,559
American Depositary Shares (the “ADSs”), each representing 10,000 ordinary shares, no par value per share (the “Ordinary Shares”), of the Company in the aggregate, comprised of (i) 122,130 ADSs (the “Initial Commitment Shares”) issued to the Selling Shareholder as consideration for the Selling Shareholder’s
irrevocable commitment to purchase the ADSs pursuant to a Standby Equity Purchase Agreement, dated December 19, 2025, between the Company and the Selling Shareholder (the “Purchase Agreement”), (ii) 366,390 ADSs (the “Subsequent Commitment Shares”) to be issued to the Selling
Shareholder as consideration for the Selling Shareholder’s irrevocable commitment to purchase the ADSs pursuant to the Purchase Agreement, (iii) 5,000,000 ADSs that may be issued from time to time by the Company to the Selling Shareholder
pursuant to the Purchase Agreement (the “Advance Shares”), as described in the Registration Statement and the prospectus contained therein,
(iv) 386,593 ADSs issued to the Selling Shareholder on the date of execution of the Purchase Agreement (the “Initial Equity Shares”) and (v)
590,446 ADSs (the “Warrant ADSs”) issuable to the Selling Shareholder upon exercise of pre-funded warrants to purchase Ordinary Shares
represented by ADSs, issued by the Company to the Selling Shareholder on the date of execution of the Purchase Agreement, all as described in the Registration Statement and the prospectus contained therein.
This opinion is being furnished in connection with the requirements of Items 601(b)(5) and (b)(23) of Regulation S-K under the Act, and no opinion is expressed herein as to any matter pertaining to
the contents of the Registration Statement or the prospectus contained therein, other than as expressly stated herein with respect to the issuance of the Ordinary Shares.
In connection with this opinion, we have examined and relied upon the Registration Statement, the Company’s Articles of Association
(the “Articles”), and such statutes, regulations, corporate records, documents, certificates, and other instruments that we have deemed relevant
and necessary as the basis of our opinions hereinafter expressed. In such examination, we have assumed: (i) the authenticity of original documents and the genuineness of all signatures; (ii) the conformity to the originals of all documents
submitted to us as copies; (iii) the truth, accuracy, and completeness of the information, representations, and warranties contained in the corporate records, documents, certificates, and instruments we have reviewed; (iv) the due execution and
delivery of all documents where due execution and delivery are a prerequisite to the effectiveness thereof; and (v) the legal capacity of all natural persons.
We have further assumed that at the time of issuance and to the extent any such issuance would exceed the maximum share capital of the Company currently authorized, the number of Ordinary Shares that
the Company is authorized to issue shall have been increased in accordance with the Company’s Articles such that a sufficient number of Ordinary Shares are authorized and available for issuance under the Articles.
We are members of the Israel Bar, and we express no opinion as to any matter relating to the laws of any jurisdiction other than the laws of the State of Israel, and have not, for the purpose of
giving this opinion, made any investigation of the laws of any jurisdiction other than the State of Israel.
The opinions set forth herein are made as of the date hereof. We assume no obligation to revise or supplement any of these opinions to reflect any changes in law or fact that may occur after the date
hereof. This opinion is expressly limited to the matters set forth above, and we render no opinion, whether by implication or otherwise, as to any other matters.
On the basis of the foregoing, and in reliance thereon, we are of the opinion that (i) the Ordinary Shares represented by the Initial
Commitment Shares and the Initial Equity Shares, as described in the Registration Statement, have been duly authorized and are validly issued, fully paid and non-assessable; (ii) the Ordinary Shares represented by the Subsequent Commitment Shares,
as described in the Registration Statement, have been duly authorized, and when issued pursuant to the terms of the Purchase Agreement, will be validly issued, fully paid and non-assessable, (iii) the Ordinary Shares underlying the Advance Shares
to be issued pursuant to the Purchase Agreement have been duly authorized for issuance, and assuming that prior to the issuance of any Advance Shares under the Purchase Agreement, the price, number of Advance Shares and certain other terms of
issuance with respect to any specific advance notice delivered under the Purchase Agreement will be authorized and approved by the Board of Directors of the Company (the “Board”) or a pricing committee of the Board in accordance with applicable law and all corporate proceedings necessary for the authorization, issuance, and delivery of the Ordinary Shares underlying such Advance Shares
shall have been taken, upon issuance and payment therefor pursuant to the terms of the Purchase Agreement and in accordance with resolutions of the Board or pricing committee, as the case may be, such Advance Shares will be validly issued, fully
paid and non-assessable; and (iv) the Ordinary Shares underlying the Warrant ADSs, as described in the Registration Statement, have been duly authorized for issuance, and when such Ordinary Shares are issued and delivered by the Company upon
exercise of the Warrants against receipt of the exercise price therefor pursuant to the terms of the Warrants, will be validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement, and we further consent to the reference to this firm in the section entitled “Legal Matters” in the
Registration Statement and in the prospectus contained therein. This consent is not to be construed as an admission that we are a party whose consent is required to be filed as part of the Registration Statement under the provisions of the Act.
|
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Very truly yours,
/s/ Goldfarb Gross Seligman & Co.
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2
Exhibit 5.2
 |
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December 31, 2025
RedHill BioPharma Ltd.
21 Ha'arba'a Street
Tel Aviv, 6473921, Israel
Re: RedHill BioPharma Ltd. Registration Statement on Form F-1
Ladies and Gentlemen:
We have acted as special U.S. counsel to RedHill BioPharma Ltd., an Israeli company organized under the laws of the State of Israel (the “Company”), in connection with the preparation and filing with the Securities and Exchange Commission (the “Commission”) under the
Securities Act of 1933, as amended (the “Securities Act”), of a registration statement on Form F-1, initially filed by the Company on December 31, 2025 (as thereafter amended or
supplemented, the “Registration Statement”). The Registration Statement relates to the resale from time to time by YA II PN, LTD., a Cayman Islands exempt limited partnership (“Yorkville”) of up to 6,465,559 American Depositary Shares (“ADSs”), each ADS representing ten thousand (10,000) ordinary shares, par
value NIS 0.01 per share (“Ordinary Shares”) or 64,655,590,000 Ordinary Shares in the aggregate, including (i) up to 5,000,000 ADSs (the “Advance ADSs”) that we may, at our discretion, elect to issue and sell to Yorkville from time to time after the date of the Registration Statement pursuant to that certain Standby Equity Purchase Agreement, dated December 19,
2025, by and between the Company and Yorkville (the “Purchase Agreement”), (ii) 386,593 ADSs (the “Initial Equity ADSs”) issued
to Yorkville on the date of execution of the Purchase Agreement, (iii) 590,446 ADSs (the “Pre-Funded Warrant ADSs”) issuable upon exercise of pre-funded warrants (the “Pre-Funded Warrants”) at the exercise price of $0.0001 per ADS, that were issued to Yorkville on the date of execution of the Purchase Agreement, and (iv) an aggregate of 488,520 ADSs issuable
to Yorkville as consideration for its irrevocable commitment to purchase the ADSs under the Purchase Agreement, to be issued in four installments, of which 122,130 ADSs were issued on the date of execution of the Purchase Agreement (the “Initial Commitment ADSs”), and an aggregate of 366,390 ADSs issuable in three equal installments (the “Subsequent Commitment ADSs”).
The ADSs will be issued pursuant to a Deposit Agreement dated as of December 26, 2012 (the “Deposit Agreement”) among the Company, The Bank of New York Mellon, as depositary (the “Depositary”), and all owners and holders (each as defined therein) from time to time of ADSs of the Company issued thereunder.
In connection with this opinion, we have examined such corporate records, documents, instruments, certificates of public officials and of the Company, including the Pre-Funded Warrant, and such
questions of law as we have deemed necessary for the purpose of rendering the opinions set forth herein.
In such examination, we have assumed the genuineness of all signatures and the authenticity of all items submitted to us as originals and the conformity with originals of all items submitted to us
as copies. We have also assumed that the Pre-Funded Warrant has been duly authorized and executed by the Company and delivered against payment in full of the consideration payable therefor.
When the ADSs are issued in accordance with the Deposit Agreement against the deposit of duly authorized, validly issued, fully paid and non-assessable Ordinary Shares, such ADSs will be duly and
validly issued under the Deposit Agreement and will entitle the holders thereof to the rights specified therein.
Based on the foregoing, and subject to the further assumptions and qualifications set forth below, it is our opinion that (i) the
Advance ADSs and the Subsequent Commitment ADSs, when the Advance ADSs and the Subsequent Commitment ADSs are issued in accordance with the Deposit Agreement against the deposit of duly authorized, validly issued, fully paid and non-assessable
Ordinary Shares, such Advance ADSs and the Subsequent Commitment ADSs will be duly and validly issued under the Deposit Agreement and will entitle the holders thereof to the rights specified therein, (ii) the Initial Equity ADSs and the Initial
Commitment ADSs have been issued against the deposit of validly issued, fully paid and non-assessable Ordinary Shares and are duly and validly issued under the Deposit Agreement and entitle the holders thereof to the rights specified therein, and
(iii) the Pre-Funded Warrant ADSs, when issued in accordance with the terms of the Pre-Funded Warrants, as applicable, and the Deposit Agreement against the deposit of duly authorized, validly issued, fully paid and non-assessable Ordinary
Shares, such Pre-Funded Warrant ADSs will be duly and validly issued under the Deposit Agreement and will entitle the holders thereof to the rights specified therein.
Please note that we are opining only as to the matters expressly set forth herein, that no opinion should be inferred as to any other matter. We are opining herein as to the laws of the State of
New York as in effect on the date hereof, and we express no opinion with respect to any other laws, rules or regulations. This opinion is based upon currently existing laws, rules, regulations and judicial decisions, and we disclaim any obligation
to advise you of any change in any of these sources of law or subsequent legal or factual developments which might affect any matters or opinions set forth herein. In rendering the foregoing opinions, we have relied, for matters involving Israeli
law, solely on the opinion of Goldfarb Gross Seligman & Co., Israeli counsel to the Company.
This opinion is being rendered solely in connection with the registration of the offering and sale of the ADSs, pursuant to the registration requirements of the Securities Act.
We hereby consent to the use of this opinion as Exhibit 5.2 to the Registration Statement, and to the reference to us under the caption “Legal Matters” in the base prospectus included in the
Registration Statement. In giving such consent, we do not hereby admit that we are acting within the category of persons whose consent is required under Section 7 of the Securities Act or the rules or regulations of the Commission thereunder. This
opinion is given as of the date hereof and we assume no obligation to update or supplement such opinion to reflect any facts or circumstances that may hereafter come to our attention or any changes that may hereafter occur.
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Very truly yours,
/s/ Haynes and Boone, LLP
Haynes and Boone, LLP
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Exhibit 10.19
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT is made as of October 17, 2025, between Talicia Holdings Inc., a Delaware company (“THI”), and Cumberland Pharmaceuticals Inc., a Tennessee company
(“Cumberland”, and together with THI, the “Parties”).
WHEREAS, RedHill BioPharma Ltd. (“RedHill”) has formed and incorporated THI to be engaged in the commercialization in the U.S. of Talicia®, a proprietary drug approved by the U.S. Food and Drug Administration for marketing in the U.S. for the treatment of H. pylori bacterial
infection in adults; and
WHEREAS, immediately prior to the execution and delivery of this Agreement, Redhill and THI entered into the Asset Purchase and License
Agreement between RedHill and THI (the “Asset Purchase Agreement”), and RedHill became the sole stockholder of THI;
WHEREAS, Cumberland desires to purchase, and THI desires to issue and sell to Cumberland, the Purchased Shares (as defined above),
pursuant to the terms of this Agreement;
WHEREAS, concurrently with this Agreement, the Parties and RedHill will be entering into the following agreements: (i) a Joint
Commercialization Agreement between THI and Cumberland, setting forth the terms for the joint commercialization of Talicia® in the United States (the “Joint Commercialization Agreement”) and (ii) a Stockholders Agreement between RedHill and
Cumberland relating to their respective rights and obligations as stockholders of THI (the “Stockholders Agreement”); and
WHEREAS, the Parties wish to enter into this Agreement to set forth the terms and conditions pursuant to which THI will issue and sell to
Cumberland, and Cumberland will purchase from THI, the Purchased Shares (as defined below);
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the Parties hereby agree as follows:
| 1. |
Purchase and Sale of Purchased Shares.
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1.1
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Purchase and Sale.
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Subject to the terms and conditions of this Agreement, THI agrees to issue and sell to Cumberland, and Cumberland agrees to purchase from THI, 300 shares of
Class B common stock, $0.001 par value per share, of THI (the “Purchased Shares”) which will represent thirty percent (30%) of the issued and outstanding shares of THI immediately following the issuance, for an aggregate purchase price of
$4,000,000 (the “Purchase Price”). Half of the Purchase Price shall be payable to THI within ten (10) business days following the Closing (as defined below), and the remaining half of the Purchase Price shall be payable to THI on the first
anniversary of the Closing. Each installment of the Purchase Price shall be paid by wire transfer of immediately available funds to a bank account designated by THI. For clarity, the full Purchase Price of $4,000,000 is a fixed, unconditional,
and non-contingent obligation of Cumberland, and the above payment schedule reflects timing only and does not affect Cumberland’s obligation to pay the entire Purchase Price. Failure to timely pay any portion of the Purchase Price when due shall
constitute a breach of this Agreement by Cumberland and entitle THI to all rights and remedies available at law or in equity.
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1.2.
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Closing; Delivery.
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(a) Closing. The issuance and sale of the Purchased Shares, and the purchase thereof by Cumberland, shall take place remotely at 5:00 p.m.
Eastern Daylight Time, on the date of this Agreement or at such other time and place as THI and Cumberland mutually agree upon (the “Closing”).
(b) Transactions at Closing. At the Closing, THI shall deliver to Cumberland a certificate representing the Purchased Shares against payment
of so much of the Purchase Price as is due upon Closing. The transactions occurring at the Closing shall be deemed to take place simultaneously and no transaction shall be deemed to have been completed or any document delivered until all such
transactions have been completed and all required documents delivered.
| 2. |
Representations and Warranties of THI. THI hereby represents and warrants to Cumberland that the following representations
are true and complete as of the date hereof.
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2.1.
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Organization, Good Standing, Corporate Power and Qualification.
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THI is duly organized, validly existing, and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to
own, lease and operate its properties and assets and carry on its business as presently conducted and as proposed to be conducted. THI is duly qualified to do business and is in good standing in each jurisdiction in which the ownership or leasing
of its properties or the conduct of its business requires such qualification.
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2.2.
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Authority and Enforceability.
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THI has all requisite corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution, delivery
and performance of this Agreement have been duly authorized by all necessary corporate action on the part of THI. This Agreement has been duly executed and delivered by THI and constitutes a valid and binding obligation of THI, enforceable against
THI in accordance with its terms except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other laws of general application affecting enforcement of creditors’ rights generally, and as
limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.
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2.3.
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No Conflicts.
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The execution, delivery, and performance of this Agreement by THI and the consummation of the transactions contemplated hereby does not and will not (a)
violate any provision of THI’s certificate of incorporation or bylaws, (b) result in any conflict with, or a breach or violation, with or without the passage of time and giving of notice, of any of the terms, conditions or provisions of, or give
rise to rights to others (including rights of termination, cancellation or acceleration) under (i) any agreement, contract, lease, license or commitment to which THI is a party or by which it is bound and, in either case, which is required to be
disclosed in the schedules attached to this Agreement (collectively, the “THI Disclosure Schedules”) or (ii) or any judgment, injunction, order, writ or decree or ruling of any court or governmental authority, domestic or foreign to which THI is
subject, (c) violate any law, regulation, order, or judgment applicable to THI or (d) constitute an event which results in the creation of any lien, charge or encumbrance upon any assets of THI or the suspension, revocation, forfeiture, or
nonrenewal of any material permit or license applicable to THI which, in the case of (b), (c) or (d), would have a Material Adverse Effect (as defined below).
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2.4.
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Capitalization.
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The authorized capital of THI consists, immediately prior to the Closing, of (i) 700 shares of Class A common stock, $0.001 par value per share, and (ii) 300
shares of Class B common stock, $0.001 par value per share, of which 700 shares of Class A common stock are issued and outstanding, all of which are owned by RedHill. All of the outstanding shares of common stock of THI have been duly authorized,
are fully paid and nonassessable and were issued in compliance with all applicable laws. There are no options, warrants, calls, rights (including conversion, preemptive rights, rights of first refusal or similar rights), convertible securities,
commitments or agreements of any character, written or oral, to which THI is a party or by which THI is bound obligating THI to issue, deliver, sell, repurchase or redeem, or cause to be issued, delivered, sold, repurchased or redeemed, any shares
or other equity interests of THI or obligating THI to grant, extend, accelerate the vesting of, change the price of, otherwise amend or enter into any such option, warrant, call, right, commitment or agreement.
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2.5.
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Valid Issuance of Purchased Shares.
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The Purchased Shares being issued to Cumberland hereunder are duly authorized and, when issued, sold and delivered in accordance with the terms and upon
receipt of the Purchase Price set forth in this Agreement, will be validly issued, fully paid and nonassessable, and free and clear of liens, pledges, charges, encumbrances or other restrictions on transfer of any kind (including, without
limitation, preemptive rights) other than restrictions on transfer under the Stockholders Agreement, applicable securities laws and liens and encumbrances created or imposed by Cumberland. Assuming the accuracy of the representations of Cumberland
in Section 3 below, and subject to the filings described in Section 2.7 below, the offer, sale, and issuance of the Purchased Shares to be issued pursuant to this Agreement will be made in compliance with all applicable securities
laws and will be exempt from the registration requirements of Section 5 of the Securities Act of 1933, as amended.
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2.6.
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Subsidiaries.
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THI does not currently own or control any interest in any other corporation, partnership, trust, joint venture, limited liability company, association, or
other business entity. THI is not a participant in any joint venture, partnership or similar arrangement.
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2.7.
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Governmental Consents and Filings.
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Assuming the accuracy of the representations made by Cumberland in Section 3 below, no consent, approval, order or authorization of, or registration,
qualification, designation, declaration or filing with, any governmental authority is required on the part of THI in connection with the consummation of the transactions contemplated by this Agreement except for filings pursuant to applicable
securities laws, which have been made or will be made in a timely manner.
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2.8.
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Litigation.
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There is no claim, action, suit, proceeding, arbitration, complaint, charge or investigation pending or, to the knowledge of THI, threatened (i) against THI
or the Product or (ii) that would reasonably be expected to have, either individually or in the aggregate, a material adverse effect on the business of THI (‘Material Adverse Effect”). THI is not party to or is named as being subject to, the
provisions of, any judgment, injunction, order, writ or decree or ruling of any court or governmental authority, domestic or foreign to which Cumberland is subject.
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2.9.
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Intellectual Property.
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(a) For purposes of this section, the following terms have the following meanings:
“Business” means the business of THI as currently being conducted by THI.
“THI Intellectual Property” means any and all Intellectual Property Rights that are either (a) owned by THI, or (b) used or practiced by THI for the
conduct of THI’s Business.
“THI Intellectual Property Registrations” means all applications, issuances and registrations with any applicable registration office or Internet
domain name registrar for Intellectual Property Rights (a) owned by, or (b) for which applications are filed in the name of, in each case, THI.
“Intellectual Property Rights” means any and all of the following rights (anywhere in the world, whether statutory, common law or otherwise): patents,
copyrights, design rights and registrations thereof and applications therefor, rights with respect to trademarks, rights with respect to domain names, rights with respect to trade secrets or confidential information, and any other intellectual
property or proprietary rights equivalent or similar to any of the foregoing.
“THI Products” means all products and services that are currently offered or distributed by THI.
“Owned THI Intellectual Property” means any THI Intellectual Property owned by THI.
“Licensed THI Intellectual Property” means any Intellectual Property Rights licensed to THI by any Person that is used by THI.
(b) Section 2.9(b) of the THI Disclosure Schedules sets forth a true, correct and complete list of all THI Intellectual Property Registrations. Each
of the THI Intellectual Property Registrations is valid and all necessary registration, maintenance and renewal fees due as of the Agreement Date in connection with THI Intellectual Property Registrations have been made, and all necessary
documents, recordations and certificates in connection with THI Intellectual Property Registrations have been filed with the relevant registration office for the purposes of prosecuting, perfecting and maintaining such THI Intellectual Property
Registrations. No Owned THI Intellectual Property or THI Products are subject to any known legal proceeding or order restricting any use, transfer or licensing of such Owned THI Intellectual Property or THI Products by THI or that affects the
validity, use or enforceability of such Owned THI Intellectual Property or use of THI Products. THI is the sole and exclusive owner of all Owned THI Intellectual Property free and clear of any liens.
4
(c) THI has a valid license or other right to use, practice and exploit all Licensed THI Intellectual Property in the manner in which the foregoing
Intellectual Property Rights are used, practiced and exploited, or are currently intended by THI to be used, practiced or exploited. THI does not use, practice or exploit any Intellectual Property Rights in connection with its Business other than
the Owned THI Intellectual Property and the Licensed THI Intellectual Property. Except for the Joint Commercialization Agreement to be executed concurrently herewith, THI has not transferred ownership of, or granted any exclusive license or
exclusive right under or with respect to, or authorized the retention of any exclusive right with respect to or joint ownership of, any Intellectual Property Right that is owned by THI to any other Person.
(d) To THI’s Knowledge, neither the operation of the Business of THI, nor the use, practice or exploitation of any THI Intellectual Property, as currently
used by THI infringes or violates any Intellectual Property Right of any Person. THI has not received written notice from any Person of any claim (A) alleging any infringement, misappropriation, misuse, violation or unfair competition or trade
practices with respect to any Intellectual Property Right, (B) that THI must license from any Person or refrain from using any Intellectual Property Right; or (C) challenging the validity, enforceability, effectiveness or ownership by THI of any of
the Owned THI Intellectual Property.
(e) The Intellectual Property Rights owned by and/or validly licensed to THI constitutes all Intellectual Property Rights necessary and sufficient for THI to
conduct its Business, except for additional internal development in the ordinary course of business and/or the acquiring of generally available off-the-shelf products. To the Knowledge of THI, no Person has infringed, misappropriated, misused or
violated, or is infringing, misappropriating, misusing or violating, any Owned THI Intellectual Property or THI Products. THI has not made any claim against any Person alleging any infringement, misappropriation, misuse or violation of any Owned
THI Intellectual Property or THI Products.
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2.10.
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FDA and Regulatory Compliance.
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Except as described in Section 2.10 of the THI Disclosure Schedules, THI holds all permits, licenses, approvals, and similar authorizations (collectively,
“Permits”) that are necessary under applicable law, regulation, rule or ordinance, for the conduct of its business as currently conducted, the lack of which could reasonably be expected to have a Material Adverse Effect, including Permits required
by the FDA and any other governmental authority necessary for the development, manufacture, marketing, sale, and distribution of the Product in the United States, including a valid and effective New Drug Application (NDA) for Talicia. THI is in
compliance in all material respects with such Permits, including, without limitation, those relating to manufacturing, labeling, advertising, promotion and distribution. There is no pending or, to THI’s knowledge, threatened action by the FDA or
any other governmental authority to suspend, revoke, or limit any approval, license, or permit relating to the Product.
| 2.11. |
Material Agreements.
|
Schedule 2.11 sets forth all the following material agreements and instruments to which THI is a party or by which it is bound (the “Material Agreements”),
(i) contracts, agreements and instruments entailing any outstanding monetary obligations (contingent or otherwise) of, or payments to, THI individually in excess of US$10,000; (ii) any license of any patent, copyright, trademark, trade secret or
other proprietary right to or from THI; (iii) any agreement granting any other person the right to manufacture, produce, assemble, market, distribute or resell any of THI’s technology, products, or services; (iv) any agreement or covenant
containing exclusivity (with respect to any geographic territory, any customer, or any product or service), or non-compete restrictions (in any area, field or geography with any person), or any other restrictions or limitations on THI’s right to
distribute, market or sell, in any material respect, its products or services in the U.S.; (v) any joint venture agreement, collaboration agreement, or strategic alliance agreement or agreement involving the sharing of profits, losses, costs or
liabilities with any other person; (vi) any agreement creating a lien, charge, pledge, or any other similar encumbrance on all or any material portion of THI’s assets, properties, or rights; (vii) any agreement for the sale, exchange or other
disposition of any of the material rights or assets of THI to any person, or of any person by THI, other than in the ordinary course of business; and (viii) any other contract, agreement, and instrument that has or may have a Material Adverse
Effect on THI’s business as currently conducted. True and correct copies of all the Material Agreements have been provided to Cumberland. All such agreements are in full force and effect and THI has no knowledge of the invalidity of or grounds for
rescission of any of these agreements, or of any intention to terminate any such agreements and to THI’s knowledge no third party is in default under any such agreement.
5
| 2.12. |
Absence of Liens.
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The property and assets that THI owns are free and clear of any liens or other security interests, except for statutory liens for the payment of current
taxes that are not yet delinquent.
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2.13.
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Compliance with Laws.
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THI is in compliance in all material respects with all applicable laws, including those relating to healthcare, anti-kickback, anti-bribery, and data
privacy, the violation of which would have a Material Adverse Effect. THI has not received any written notice of or been charged with the violation of any law and, to THI’s knowledge, there is no threatened action or proceeding against THI under
any of such laws. THI is not in violation of or default under (i) or any judgment, injunction, order, writ or decree or ruling of any court or governmental authority, domestic or foreign to which THI is subject.
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2.14.
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Assets and Properties.
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THI has good and marketable title to all of the tangible properties and assets owned by THI, which are material to the business of THI as currently
conducted, and such properties and assets are free and clear of all mortgages, deeds of trust, liens, pledges, charges, security interests, conditional sale agreement, loans, and encumbrances, except for statutory liens for the payment of current
taxes that are not yet delinquent and encumbrances and liens that arise in the ordinary course of business and do not materially impair THI’s ownership or use of such property or assets. THI does not own any real property.
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2.15.
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Insurance.
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Prior to the Closing, THI does not maintain separate insurance policies, and coverage for its activities is provided under the insurance policies maintained
by RedHill and its affiliates, as applicable. From and after the Closing, THI (or its affiliates, as applicable) will maintain insurance policies in such amounts and covering such risks as are customary in the pharmaceutical industry. As of the
date hereof, THI or its affiliates has fully paid all the payments required in order to fully comply with the terms of the insurance policies and THI has not received any notice of cancellation or a notice of intent to cancel any of the insurance
policies. To THI’s Knowledge, THI has not undertaken any action, or omitted to take any action, which could render any such insurance policy void or voidable or which could result in a material increase in the premium for any such insurance policy.
6
|
2.16.
|
Taxes.
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THI has not, and has not been required to, file any tax returns and reports (including information returns and reports) as required by applicable law.
| 2.17. |
Corporate Documents.
|
The Certificate of Incorporation and By-laws of THI in effect as of the date of this Agreement are in the forms provided to Cumberland.
| 3. |
Representations and Warranties of Cumberland.
|
Cumberland hereby represents and warrants to THI that the following representations are true and complete as of the date hereof.
|
3.1.
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Organization and Good Standing.
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Cumberland is duly organized, validly existing, and in good standing under the laws of the State of Tennessee.
|
3.2.
|
No Conflicts.
|
The execution, delivery, and performance of this Agreement by Cumberland and the consummation of the transactions contemplated hereby does not and will not
(a) violate any provision of Cumberland’s organizational documents, (b) result in any conflict with, or a breach or violation, with or without the passage of time and giving of notice, of any of the terms, conditions or provisions of, or give rise
to rights to others (including rights of termination, cancellation or acceleration) under (i) any agreement, contract, lease, license or commitment to which Cumberland is a party or by which it is bound or (ii) or any judgment, injunction, order,
writ or decree or ruling of any court or governmental authority, domestic or foreign to which Cumberland is subject, (c) violate any law, regulation, order, or judgment applicable to Cumberland or (d) constitute an event which results in the
creation of any lien, charge or encumbrance upon any assets of Cumberland or the suspension, revocation, forfeiture, or nonrenewal of any material permit or license applicable to Cumberland.
|
3.3.
|
Authorization.
|
Cumberland has all requisite corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder. All corporate
action necessary for the authorization, execution, and delivery by Cumberland of this Agreement, and for the performance of all obligations of Cumberland hereunder, has been taken. This Agreement has been duly executed and delivered by Cumberland
and constitutes a valid and binding obligation of Cumberland, enforceable against Cumberland in accordance with its terms except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other laws
of general application affecting enforcement of creditors’ rights generally, and as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.
7
|
3.4.
|
Restricted Securities.
|
Cumberland understands that the Purchased Shares are “restricted securities” under applicable U.S. federal and state securities laws and that and that the
Purchased Shares have not been and there is no assurance that they will ever be registered under the Securities Act of 1933 (the “Securities Act”), as amended, or any applicable securities laws and, therefore, their transferability is limited and
they cannot be freely resold unless they are registered under the Securities Act and applicable state securities laws or unless an exemption from such registration requirements is available. The investor is aware that THI is under no obligation to
effect any registration or to file for or comply with any exemption from registration. The sale and issuance of the Purchased Shares have not been registered under the Securities Act by reason of a specific exemption from registration which depends
upon, among other things, the accuracy of the Investor’s representations as expressed herein.
|
3.5.
|
No Public Market.
|
Cumberland understands that no public market now exists for the Purchased Shares, and that THI has made no assurances that a public market will ever exist
for the Purchased Shares.
|
3.6.
|
Experience.
|
Cumberland is an experienced purchaser and has reviewed and inspected the data and information provided to it by THI in connection with this Agreement.
Cumberland is a sophisticated investor with experience in making such investments to be capable of evaluating the merits and risks of such an investment, and of investing, in THI. Cumberland represents that it is an “accredited investor” within
the meaning of Regulation D under the Securities Act of 1933, as amended.
|
3.7.
|
Disclosure of Information.
|
Cumberland has had an opportunity to discuss THI’s business, management, financial affairs and the terms and conditions of the offering of the Purchased
Shares with THI and has had an opportunity to review THI’s facilities. The foregoing, however, does not limit or modify the representations and warranties of THI in Section 2 of this Agreement or the right of Cumberland to rely thereon.
|
3.8.
|
Purchase for Own Account.
|
Cumberland hereby confirms that the Purchased Shares to be acquired by Cumberland will be acquired for investment for Cumberland’s own account, not as a
nominee or agent, and not with a view to the resale or distribution of any part thereof, and that Cumberland has no present intention of selling, granting any participation in, or otherwise distributing the same. By executing this Agreement,
Cumberland further represents that Cumberland does not presently have any contract, undertaking, agreement or arrangement with any Person to sell, transfer or grant participations to such Person or to any third Person, with respect to any of the
Purchased Shares.
|
3.9.
|
Legends. To the extent applicable, each stock certificate shall bear a legend substantially in the following form:
|
“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE
SALE OR DISTRIBUTION THEREOF. NO SUCH TRANSFER MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM REASONABLY SATISFACTORY TO THI THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE
SECURITIES ACT OF 1933.
THESE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED EXCEPT IN COMPLIANCE WITH THAT CERTAIN STOCKHOLDERS AGREEMENT DATED AS OF
OCTOBER 17, 2025.”
8
| 4. |
Miscellaneous.
|
4.1 Notices. All notices, consents, directions, approvals, instructions, requests and other communications required or permitted by the terms of this
Agreement to be given to any Person shall be in writing, and any such communication shall become effective five business days after being deposited in the mail, certified or registered, with appropriate postage prepaid for first class mail, or, if
delivered by hand or courier service, when received (if received during normal business hours on a business day, or if not, then on the next business day), and shall be directed to the following address:
If to THI:
Talicia Holdings, Inc.
8311 Brier Creek Parkway
Suite 105-161
Raleigh, NC 27617
with a copy (which shall not constitute notice) to:
Goldfarb Gross Seligman & Co.
One Azrieli Center, Round Tower
Tel Aviv, 67021
Israel
Attention: Perry Wildes
E-mail: perry.wildes@goldfarb.com
If to Cumberland:
Cumberland Pharmaceuticals Inc.
c/o Cumberland CEO
1600 West End Ave #1300
Nashville, TN 37203
with a copy (which shall not constitute notice) to:
Cumberland Pharmaceuticals Inc.
c/o Cumberland Corporate Counsel
1600 West End Ave #1300
Nashville, TN 37203
or to such other address as a Party may have furnished to the other Party in writing in accordance herewith, except that notices of change of address shall only be effective upon receipt.
9
4.2 Governing Law. This Agreement and all issues arising hereunder or relating hereto, including, without limitation, its construction,
validity, breach, and damages for breach shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any
other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. In the event of any dispute between the Parties regarding this Agreement, either of the Parties may deliver a written notice to
the other Party stating its intention to submit such matter to arbitration (the "Arbitration Notice"). Following delivery of the Arbitration Notice, the Parties shall have an additional seven (7) calendar days to attempt to resolve the matter in
good faith. If the matter remains unresolved after such additional seven (7) day period, either of the Parties may submit such matter to arbitration to be conducted by the American Arbitration Association (the “AAA”) in accordance with the
commercial arbitration rules of the AAA, and the decision of the arbitrator shall be final and binding. The AAA shall provide an arbitrator with experience in commercial and corporate matters relevant to the matter to be decided. The arbitration
hearing shall be held in New York City, New York, and the Parties shall split equally all costs and expenses of the AAA.
4.3 Amendments; Waivers. This Agreement may not be amended, modified, altered or supplemented other than by means of a written instrument duly executed and
delivered by each of the Parties. Failure to insist upon strict compliance with any of the terms, covenants or conditions of this Agreement shall not be deemed a waiver of that term, covenant or condition or of any other term, covenant or condition
of this Agreement. Any waiver or relinquishment of any right or power hereunder at any one or more times shall not be deemed a waiver or relinquishment of that right or power at any other time.
4.4 Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to the subject matter of this Agreement and supersedes
all prior agreements and understandings, both oral and written, between the Parties with respect to the subject matter of this Agreement.
4.5 No Assignment. This Agreement shall not be assigned by operation of law or otherwise by any Party to any person without the written consent of the other
Party. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties.
4.6 Severability. Any provision of this Agreement that shall be prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the remaining provisions thereof and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties to such instrument waive any provision of law that renders any provision thereof prohibited or unenforceable in any respect
4.7 Further Assurances. Each Party shall execute, or procure the execution of, such further documents as may be required by law or be necessary to implement and
give effect to this Agreement and secure to the other Party the full benefit of the rights, powers and remedies conferred upon such other Party under this Agreement.
4.8 No Third-Party Beneficiaries. Nothing in this Agreement, express or implied, is intended to confer upon any person other than the parties hereto any rights
or remedies.
4.9 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one
and the same agreement. A signed copy of this Agreement delivered by facsimile, email, or other means of electronic transmission (including by means of email transmission or in .pdf or similar format, in each case, complying with the U.S. federal
ESIGN Act of 2000 (e.g., www.docusign.com)) shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
[Signature Page Follows]
10
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.
|
Talicia Holdings Inc.
|
||
|
By:
|
/s/ Razi Ingber | |
| Name | Razi Ingber | |
| Title | CFO | |
|
Cumberland Pharmaceuticals Inc.
|
||
|
By:
|
/s/ AJ Kazimi |
|
| Name | AJ Kazimi | |
| Title | Chief Executive Officer | |
Exhibit 10.20
CONFIDENTIAL
PURSUANT TO ITEM 601(b)(10) OF REGULATION S-K, CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED BY MEANS OF MARKING SUCH PORTIONS WITH ASTERISKS [*****] AS THE
IDENTIFIED CONFIDENTIAL PORTIONS ARE BOTH NOT MATERIAL AND ARE THE TYPE OF INFORMATION THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL. THE REGISTRANT AGREES TO SUPPLEMENTALLY FURNISH AN UNREDACTED COPY OF THIS EXHIBIT TO THE SEC UPON ITS
REQUEST.
EXCLUSIVE JOINT COMMERCIALIZATION AGREEMENT
THIS EXCLUSIVE JOINT COMMERCIALIZATION AGREEMENT (this “Agreement”) is made and entered into as of October 17, 2025 (the “Effective Date”), by and between Talicia Holdings Inc., a Delaware
corporation (“THI”) with registered office at 8311 Brier Creek Parkway, Suite 105-161, Raleigh, NC 27617 and Cumberland Pharmaceuticals Inc., a Tennessee corporation (“Cumberland”)
with registered office at 1600 West End Avenue, Suite 1300, Nashville TN, 37203. THI and Cumberland each may be referred to herein individually as a “Party,” or
collectively as the “Parties.”
| A. |
THI owns or controls certain Intellectual Property relating to Product (as such term is defined herein);
|
| B. |
The Parties wish to jointly undertake the Joint Commercialization of Product all as more fully set forth herein;
|
| C. |
Subject to the terms and conditions set forth in this Agreement, THI wishes to license to Cumberland, and Cumberland wishes to license from THI all intellectual property necessary for use solely in connection with the Joint
Commercialization of Product in the Territory by the Parties.
|
NOW THEREFORE, in consideration of the foregoing and the mutual agreements set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties hereby agree as follows:
| 1. |
DEFINITIONS
|
Unless specifically set forth to the contrary herein, the following terms will have the respective meanings set forth below.
1.1 “Affiliate(s)” of a Party means any other entity that, directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under common control with such Party. For purposes of this definition only, “control” and, with correlative meanings, the terms “controlled by” and “under common control with”
will mean the possession, directly or indirectly, of the power to direct the management or policies of an entity, whether through the ownership of fifty percent (50%) or more of the voting securities of the other organization or entity or by
contract relating to voting rights or corporate governance. For the avoidance of doubt, Affiliates of THI shall also include RedHill Biopharma Ltd. and RedHill Biopharma Inc., and Affiliates of Cumberland shall also include Cumberland Assured
Products Inc.
1.2 “cGMP” means then-effective and current Good Manufacturing Practices applicable to the manufacture of the Product, as
established and interpreted by the FDA under and in accordance with the U.S. Federal Food, Drug and Cosmetic Act, Title 21 of the U.S. Code of Federal Regulations, Parts 210, 21 1, 600, 601 and 610, and all regulations and guidelines issued
thereunder.
1.3 “Commercialization” means activities directed to marketing, advertising, promoting, co-promoting, detailing, distributing,
importing, or selling the Product, including without limitation, maintenance of Marketing Authorization post-marketing requirements, manufacture of commercial supplies and education, planning, product support and medical efforts related to the
Product, and when used as a verb, “Commercialize” means to engage in such activities. For clarity, manufacturing and supply of the Product with respect to sample and commercial supplies of the Product shall
be included within Commercialization, however, Cumberland shall have no right or obligation to directly or indirectly manufacture or supply the Product (or to arrange for the manufacture or supply of the Product) without prior written agreement of
THI.
1
1.4 “Committee” shall have the meaning set forth in Section 4.1.
1.5 “Confidential Information” shall have the meaning set forth in Section 14.2.
1.6 “Conforming Product” means Product conforming to the Marketing Authorization,
cGMP, the applicable Quality Agreement, and applicable law at the time of Delivery to Cumberland.
1.5 “Cumberland Improvements” shall have the meaning set forth in Section 13.1.
1.6 “Cumberland Parties” shall have the meaning set forth in Section 16.1.
1.7 “Delivery” shall have the meaning set forth at Section 8.3.
1.8 “DSCA” means Title II of the Drug Supply Chain
Security Act of the Drug Quality and Security Act, signed into law November 27, 2013, as amended and including all implementing regulations issued by the FDA related thereto.
1.9 “Facility” means the manufacturing facility where all manufacture of Product shall
be performed, located at APL Strangnas AB as their FDA approved facility in Sweden.
1.10 “Field of Use” means all indications approved by the FDA under the NDA for the
Product as of the Effective Date or in the future, including the FDA-approved full prescribing information.
1.11 “FDA” shall mean the Food and Drug Administration of the United States of America.
1.12 “FFDCA” shall mean the Federal Food, Drug and Cosmetic Act, as amended, 21 U.S.C. §301 et seq., and any related federal
and/or state law or regulation in the Territory pertaining to the safety, effectiveness, adulteration, misbranding, mishandling, packaging, labeling or storage of pharmaceutical ingredients, finished and labeled pharmaceutical Product, that may be
applicable to Product during the Term.
1.13 “Governmental Authority” shall have the meaning set forth in Section 11.1.2.
1.14 “Improvement(s)” shall have the meaning set forth in Section 2.5.
1.15 “Intellectual Property” shall mean all patents and patent rights, trademarks,
logos, slogans, designs, know-how, clinical trial results, and other intellectual property or proprietary rights owned or controlled by THI, in each case solely to the extent necessary for the Joint Commercialization of the Product in the Territory
in the Field of Use during the Term.
1.16 “Joint Commercialization” shall mean the collaboration of the Parties in the
Commercialization of the Product in the Territory in the Field of Use during the Term.
1.17 “Joint Improvements” shall have the meaning set forth in Section 13.1.
1.18 “KOLs” means key opinion leaders to include external experts, such as healthcare providers, insurance professionals,
patients, caregivers, and others who can share valuable expertise, opinions, and perspectives in managing a disease state with respect to the Product.
1.19 “Laboratory” shall have the meaning set forth in Section 8.6.
2
1.20 “Latent Defect” shall mean a Product that is Nonconforming Product and not discoverable upon reasonable physical inspection
and testing prior to or on acceptance by Cumberland, but is discovered at a later time and is not attributable to Cumberland’s (or its Sublicensees or subcontractor’s) improper handling or storage of Product after Delivery.
1.21 “Launch” shall mean the official date on which Cumberland’s national field sales
force division begins active promotion of the Product pursuant to this Agreement. For clarity, Cumberland may commence selling Product upon the Effective Date.
1.22 “License” shall have the meaning set forth in Section 2.1.
1.23 “Losses” shall have the meaning set forth in Section 16.1.
1.24 “Marketing Authorization” shall mean the New Drug Application (“NDA”) No. 213004
for the Product. including all supplements extensions and necessary regulatory approvals required from the FDA or other agency in order to Commercialize the Product in the Territory, and satisfaction of any related regulator registration and
notification requirements and fees, including approvals for any expansion or modification of the label.
1.25 “Medical Affairs Activities” means the coordination of medical, clinical and
scientific activities, and information for the Product, including medical information, publications, health and economic outcomes, patient registry, medical advisory boards, continuing medical education programs, field-based medical scientific
liaisons (including virtual face-to-face interactions conducted by medical scientific liaisons), and development and management of relationships with KOLs. For clarity, “Medical Affairs Activities” does not
include any Product promotional activities by Cumberland.
1.26 “Net Revenue” means the gross amounts invoiced by Cumberland or Cumberland’s
Affiliates or Sublicensees in respect of the sale of Product on behalf of Cumberland or Cumberland’s Affiliates or Sublicensees, less the following deductions to the extent actually incurred or allowed in accordance with IFRS or U.S. GAAP and the
accrual method of accounting (collectively, the “Recognized Deductions”):
(i) allowances or credits granted to and taken by customers (including wholesalers) for rejections, returns (including as a result of recalls),
including but not limited to prompt payment and trade, cash and volume discounts or overbills, administrative fees, third party rebates, volume rebates; (these fees include, cash discounts, fee for service, chargebacks, expired and short dated,
damages and returned and coupon discounts);
(ii) amounts and expenses incurred resulting from government mandated rebate programs (or any agency thereof), and chargebacks;
(iii) taxes, including value added tax, sales and excise taxes, other consumption taxes, tariffs or import/export or customs, duties or other governmental charges;
(iv) government and commercial rebates, charge backs and discounts paid or credited;
(v) receivables deemed to be uncollectible according to Cumberland’s internal accounting principles. If a bad debt deduction is taken for a receivable and such
receivable is subsequently collected, such receivable shall be included in Net Revenue in the next applicable payment period
Notwithstanding the foregoing, for the purposes of this definition, the transfer of Product by Cumberland or one of Cumberland’s Affiliates or Sublicensees to another Affiliate of Cumberland or to
another Sublicensee for resale is not a sale and, in such cases, Net Revenue will be determined based on the amount invoiced by Cumberland or such Affiliate or Sublicensee in respect of Product as sold by the Affiliate or Sublicensee to independent
third-parties, less the Recognized Deductions.
1.27 “Non-Conforming Product” means Product that is not Conforming Product.
3
1.28 “PDUFA Fees” shall mean the Prescription Drug User Fee Act fees and/or assessments related to the
Product for any period before, during, or after the Term of this Agreement.
1.29 “Pharmacovigilance” shall mean the science and activities relating to the detection, collection,
recording assessment, understanding, reporting, prevention and/or management, and disclosures, of adverse experiences, adverse events or other safety matters related to the Product and its use, in the Territory and worldwide in accordance with
applicable laws.
1.30 “Product” shall mean the pharmaceutical product that is
marketed as Talicia – a fixed-dose, delayed release oral capsule formulation containing omeprazole magnesium, amoxicillin, and rifabutin that is based on THI or its Affiliates Intellectual Property, in all doses and formulations, in all Fields of
Use, whatsoever, in finished packaged and labeled form for distribution and sale in the Territory and in compliance with the Marketing Authorization and approved labeling and applicable laws.
1.31 “Quality Agreement” shall mean a mutually acceptable quality agreement to be entered into between
the Parties, which will govern the quality and safety of Product to be purchased by Cumberland from THI in compliance with cGMP and this Agreement.
1.32 “Regulatory Authority” means any applicable government
entity, including the FDA, regulating or otherwise exercising authority with respect to the Commercialization of Product.
1.33 “Representatives” shall have the meaning set forth in Section 14.3(iv).
1.34 “Sublicense” means a sublicense from Cumberland to a third
party under the License granted pursuant to this Agreement and the term “Sublicensee” shall be construed accordingly. Any Sublicense may include the right to grant
further Sublicenses.
1.35 “Sublicense Sales Royalties” means sales royalties,
milestones, income, and all cash or equivalents to which value can be assigned directly and/or indirectly actually received by Cumberland from Sublicensees (and/or any further Sublicensees thereof) in respect of Product.
1.36 “Term” shall have the meaning set forth in Section 17.1.
1.37 “Territory” shall mean the United States of America and its territories, commonwealths, and
possessions.
1.38 “THI Improvements” shall have the meaning set forth in Section 13.1.
1.39 “THI Parties” shall have the meaning set forth in Section 16.2.
1.40 “THI’s Revenue Share” shall have the meaning set forth in Section 9.1.
1.41 “Transfer Price” shall
mean the price Cumberland will pay for THI supply of Product as set forth in Exhibit “A” attached hereto.
1.42 “Transferred Product” shall have the meaning set forth in
Section 8.2.
1.43 “Withholding Taxes” shall have the meaning set forth in Section 9.7.
| 2. |
LICENSE GRANT
|
2.1 Scope of License. Subject to all the terms and conditions of this Agreement, THI hereby grants to Cumberland, an
exclusive (including as to THI and its Affiliates except as set forth in this Agreement) license in and to the Intellectual Property with such exclusivity being limited to the right to and for the sole purpose of Joint Commercialization of the
Product as provided in this Agreement during the Term (the “License”). Such License is granted solely during the Term and shall automatically expire upon the expiration
or earlier termination of this Agreement.
4
2.2 Sublicenses. The License granted to Cumberland under this Agreement may not be Sublicensed, transferred, or
co-promoted, in whole or in part, to or by any third party without the prior written consent of THI, such consent not to be unreasonably withheld. For the avoidance of doubt, Cumberland shall, subject to the License grant provided herein, be
entitled to conduct or to perform any activity in respect of Product by means of any third-party sub-contractor, and such conduct shall not be considered to be a grant of a Sublicense hereunder. Cumberland shall remain liable to THI for the
performance of Cumberland’s subcontractors, transferees, co-promoters, and Sublicensees consistent with the terms of this Agreement. Any consideration (net after expenses associated with the Sublicense including reasonable overhead for taxes and
management of the Sublicense) received by Cumberland in connection with an approved Sublicense, transfer, or co-promote shall be deemed Net Revenue for purposes of Section 9. For the avoidance of doubt, Cumberland shall not, and shall not permit or
authorize any third party to, solicit or make sales of the Product for delivery or use outside the Territory or outside the Field of Use, or in circumstances where Cumberland should reasonably have understood that the Product will be transferred or
used outside the Territory.
2.3 Intentionally Omitted.
2.4 Limitations on Other Licenses. During the Term, and subject to the terms and conditions of this Agreement, THI and
its Affiliates shall not grant any rights or licenses to any Intellectual Property to any third party that may conflict with THI’s obligations under this Agreement and the License and rights granted to Cumberland under this Agreement, without
Cumberland’s express written consent, which may not be unreasonably withheld by Cumberland.in its sole discretion.
2.5 Other Formulations. If THI or its Affiliates develops during the Term any new product derived from the Product,
i.e. any improvement in terms of dosage, route of administration or formulation of a product (hereinafter referred to as, individually, an “Improvement”; collectively, the “Improvements”),
THI shall promptly notify Cumberland and shall provide to Cumberland, in writing, an exclusive license to store, promote, sell and distribute each such Improvement consistent with the terms of this Agreement.
| 3. |
DATA TRANSFER.
|
3.1 Data Transfer. Upon execution of this Agreement and upon reasonable written request from Cumberland, THI shall
reasonably provide to Cumberland, at no cost to Cumberland, all the pertinent information held by THI or its Affiliates that THI or its Affiliates has about Product including, but not limited to, all Intellectual Property, clinical trials data, key
communications with Regulatory Authorities in the U.S. and elsewhere, manufacturing, supply, external service and other contracts and any and all other information whatsoever that is relevant for the Joint Commercialization of the Product in the
Territory.
| 4. |
JOINT COMMERCIALIZATION COMMITTEE.
|
4.1 Formation. Within thirty (30) days following the Effective Date, the Parties shall establish a joint (50/50)
Commercialization committee (“Committee”). The Committee will oversee all Commercialization, pricing, contracting, sales and marketing activities related to the Product pursuant to this Agreement. At each
Committee meeting, at least one (1) member appointed by each Party must be present in person or by telephone to constitute a quorum. Each Party shall have equal voting power, whether represented by one or two committee members, on all matters
before the Committee. The Committee shall monitor and coordinate communication regarding the Parties’ performance under this Agreement. The Committee shall not have any power to amend, modify or waive compliance with this Agreement. Each Party
shall have an equal number of members on the Committee. The Parties shall in good faith agree from time to time on the appropriate total number and representatives for the Committee. The Committee shall meet at least once per quarter, including at
least one face-to-face meeting per calendar year. A Committee meeting may be scheduled on at least ten (10) business days’ notice by any member of the Committee or on mutual agreement. For purposes of decision making the Committee shall require a
quorum of at least one (1) member from each Party before discussion or voting. Decisions of the Committee must be unanimous of the quorum present. The Committee shall keep minutes of meetings. The minutes of the meetings must be signed by
representatives of both Parties to reflect a decision. However, in no case, shall a decision of the Committee be valid if it would amend, modify, or waive terms of this Agreement.
5
4.2 Guidelines. The Committee will be charged with developing the guidelines for Joint Commercialization of the Product
in the Territory and the application of Cumberland funding as set forth in Section 9.6, including but not limited to, identification of the Launch date, any preliminary soft launch activities, sales training timelines, setting of customer targets,
frequency and scope of engagements, marketing and promotional campaigns and initiatives with related costs, advertising or promotional materials or tactics, project timelines, and Medical Affairs Activities. The Committee shall also review and
approve the overall market access strategy, including contracting and reimbursement arrangements with public and private payers (including Medicare, Medicaid, and commercial plans). All guidelines must be approved in writing by each of the Parties.
4.3 Inability to Unanimously Decide. If the members of the Committee cannot reach a unanimous decision with respect to
matters delegated to it for a period in excess of ten (10) business days from the discussion at the Committee, unless the Parties agree to prolong such time period, the matter shall be referred to appropriately qualified senior executive officers
of the Parties, who shall attempt resolution by good faith negotiations for at least ten (10) business days after such referral. If the senior executive officers designated by the Parties are not able to resolve such dispute within such ten (10)
business day period, then such issues may be submitted to the CEOs of each Party for attempted resolution. If such matter is thereafter not resolved within fifteen (15) business days, either Party may submit the matter to dispute resolution under
Section 18.3 below.
4.4 Unless otherwise expressly stated, nothing contained in this Agreement may be deemed to make any member of the Committee a partner, agent, or legal representative
of the other, or to create any fiduciary relationship for any purpose whatsoever. No member of the Committee shall have any authority to act for, or to assume any obligation or responsibility on behalf of, any other member of the Committee, or the
other Party.
| 5. |
CUMBERLAND’S COMMERCIALIZATION RESPONSIBILITIES
|
5.1 As between the Parties, Cumberland shall, at its sole cost and expense, be responsible for funding, supervising, and deploying Cumberland’s national field sales
division (that also promotes Cumberland’s Kristalose product) to promote the Product in accordance with the guidelines established by the Committee. Cumberland shall use commercially reasonable efforts to Commercialize the Product in the Territory
pursuant to the terms of this Agreement. The Committee shall establish an annual commercial plan for the Product. Neither Party shall be permitted to unilaterally substantially reduce its dedication or effort or prioritization, of the Product from
the approved Plan without the Committee’s prior written approval.
5.2 As between the Parties, Cumberland shall, at its sole cost and expense, be responsible for the human resources, information technology, finance, compliance, and
management activities in support of Cumberland’s national field sales division.
5.3 As between the Parties, and beginning on the Effective Date, Cumberland shall, at its sole cost and expense, have the exclusive right and authority to invoice and
book one hundred percent (100%) of the gross and net sales of the Product in the Territory, establish all terms of sale (including pricing, credit terms, cash discounts and returns and allowances) and have the exclusive right to warehouse and
distribute the purchased Product in the Territory and perform or cause to be performed all related services. All such terms of sale, warehousing of purchased Product and distribution of Product shall comply with applicable law.
5.4 As between the Parties, Cumberland shall, at Cumberland’s sole cost and expense, handle all contracting activities with Cumberland trade customers (including
wholesalers, distributors, and pharmacies) and all activities relating to their purchase of the Product including accepting of orders, order processing, invoicing, collection, distribution and/or delivery to Cumberland customers from Cumberland’s
chosen U.S. based inventory warehousing or storage locations. For the avoidance of doubt, Cumberland shall have no obligation or right to import the Product into to the U.S. except through THI.
6
5.5 As between the Parties, Cumberland shall, at its sole cost and expense, fund the prior authorization programs, to the extent approved by the Committee as part of
the annual funding described in Section 9.6. In addition, Cumberland shall, at its sole cost and expense, manage and fund the rebate processing and co-pay administration.
5.6 For the avoidance of doubt, neither Cumberland nor Cumberland’s Affiliates or Sublicensees shall have the right or obligation to perform any manufacturing or
development activities with respect to the Product without THI’s prior written consent.
| 6 |
THI COMMERCIALIZATION RESPONSIBILITIES
|
6.1 As between the Parties, THI shall at THI’s sole cost and expense maintain all Marketing Authorizations required to Commercialize the Product in the Territory,
including the Product NDA and the timely payment of all FDA fees regarding the Product, including but not limited to PDUFA Fees. THI shall be the Marketing Authorization holder in the Territory. THI accepts and assumes all liabilities and
responsibilities with regard to the maintenance and continuation of the Product Marketing Authorization and communication and correspondence with the FDA regarding the Product, except as otherwise required by applicable law
6.2 As between the Parties, if THI receives any orders from a customer in the Territory or for distribution in the Territory, THI shall promptly advise such customers
that Cumberland is the exclusive authorized Party to accept orders for the Product. The method for transfer of orders receiving by THI to Cumberland shall be determined by Cumberland. Cumberland shall be the exclusive authorized Party to accept
orders for Product in the Territory.
6.3 As between the Parties, THI shall at its sole cost and expense, have the obligation relating to the manufacture and costs of goods sold, supply, and delivery of
the Product to Cumberland at a location chosen by Cumberland. For the avoidance of doubt, THI shall have the exclusive right and obligation to arrange for import of Product into the Territory and all related obligations into the Territory, if
applicable.
6.4 As between the Parties, THI shall, at its sole cost and expense, manage and fund the marketing, market access, supply chain, quality, Pharmacovigilance, and their
finance and management activities related to the Product.
6.5 As between the Parties, THI, or its Affiliates, shall, at its sole cost and expense, be responsible for all recalls or withdrawals and associated costs except to
the extent arising from Cumberland distribution, storage, or field activities, including those handled through Cumberland’s 3PL. The Parties shall promptly inform each other of any potential recall or withdrawal and cooperate in good faith in
managing the process.
6.6 As between the Parties, THI shall exclusively manage all Medical Affairs Activities relating to the Product.
| 7. |
REGULATORY MATTERS
|
7.1 Regulatory Communications. If any Regulatory Authority (a) contacts a Party with respect to the Product, (b)
inspects, audits, or gives notice of its intent to inspect or audit any Facility with respect to the Product manufacturing process or storage, or (c) takes, or gives notice of its intent to take, any regulatory action alleging improper or
inadequate practices by a Party, or THI’s manufacturer of the Product (including but not limited to a FDA Form 483, issuance of a “Notice of Inspectional Observations” or a “Warning Letter”) , said Party shall notify the other Party within three
(3) business days of such contact or notice, and shall supply the other Party with all information pertinent thereto. The Party in receipt of such communications from a Regulatory Authority shall provide the other Party with copies of all
documentation issued by any Regulatory Authority in connection therewith and any proposed response thereto and any other information the other Party may reasonably request with respect to the Product in any manner. No such response shall include
any intentionally false or misleading information. Cumberland shall have the right to review and provide comments on, and THI shall have the right to review and approve, where practicable, in advance, any proposed responses by the other Party to
Regulatory Authorities that pertain to the Product or the manufacture of the Product or to the Product Facility or warehouse to the extent applicable to the Product in the Territory. THI shall facilitate on-site inspections of the Facility
conducted by Regulatory Authorities and Cumberland shall have no responsibility therefor.
7
7.2 Inspections. Cumberland shall be entitled to visit the Facility and/or warehouse where Product is stored during
operational hours during the Term. Upon Cumberland’s reasonable request. THI shall coordinate, expedite and guide such visits. Cumberland will attempt to provide THI with written notice of at least one (1) month prior to any visit, and the Parties
shall decide on a mutually agreeable date, duration, visitor list, and agenda prior to the visit. Additionally, Cumberland may, at its own cost and expense and at no charge by THI request up to two (2) of its personnel to be on-site at the Facility
and/or THI’s Product warehouse to observe and consult with THI during the performance of activities under this Agreement, and such additional personnel in such numbers as deemed necessary shall be accommodated upon mutual agreement. THI shall
provide reasonable customary support and all other expenses shall be borne by Cumberland.
7.3 Pharmacovigilance. All Pharmacovigilance with respect to the Product shall be the sole responsibility of THI who
shall promptly provide Cumberland with any information of which it becomes aware concerning the safety or efficacy of the Product. The Parties agree to enter into a Pharmacovigilance agreement in accordance with this Section 7.3 within a reasonable
time of Launch.
| 8. |
PRODUCT SUPPLY
|
8.1 Conforming Product. THI represents and warrants to Cumberland that THI and its Affiliates shall supply Conforming
Product to Cumberland and its Affiliates in the Territory in accordance with applicable laws which shall include but not be limited to DSCA, cGMP and all requirements as promulgated under the FFDCA at 21 CFR
(Parts 210 and 211), and as further defined by FDA guidance documents, as such may be amended from time to time, applicable to the manufacturing, processing and packaging of the Products or any other applicable Regulatory Authority in the
Territory. THI shall provide a Certificate of Analysis and a Certificate of cGMP Compliance along with all delivery of Product to Cumberland pursuant to this Agreement documenting that each relevant manufacturing batch has met the specifications
stated in the Marketing Authorization and the Quality Agreement, and from which such supplied quantity of Product is sourced. Within thirty (30) days after Cumberland’s receipt of Product, it shall notify THI in writing of any complaint or claim on
account of quality, quantity, errors in number or weight, or patent defect promptly upon discovering same in accordance with this section and THI shall respond and resolve such complaint or claim in accordance with this Section and the Quality
Agreement within ten (10) days after the above written notice from Cumberland. THI warrants that all Product manufactured by THI or its Affiliates or designees and delivered to Cumberland will be free from any security interests, claims, demands,
liens, and other encumbrances.
8.2 Transfer of THI Existing Inventory. THI shall transfer to Cumberland all existing inventory of the Product located
at Cardinal Health distribution center in La Verne, Tennessee on the Effective Date (“Transferred Product”). Title and risk of loss to such Transferred Product shall pass to Cumberland upon Delivery.
Delivery of Transferred Product shall be deemed to occur at midnight on the Effective Date. Product inventory of Transferred Product as of the Effective Date shall be consistent with daily inventory averages for the first three (3) quarters of
calendar year 2025.
8.3 Purchase Orders. THI shall deliver all additional Product to Cumberland after receipt of a purchase order from
Cumberland (DDP incoterms 2025) at Cumberland’s designated warehouse (“Delivery”). Cumberland shall reasonably exhaust inventory of Transferred Product before issuing purchase orders for additional Product.
Delivery shall be within ninety (90) days of THI’s receipt of Cumberland’s purchase order subject to THI’s ongoing manufacturing schedule and existing supply commitments as of the Effective Date, and the Parties shall coordinate in good faith to
align production and inventory flow to enable Delivery within a ninety (90) day timeframe from receipt of purchase order. Product shall be shipped directly from the manufacturer to Cumberland’s designated 3PL (DDP incoterms 2025). For the avoidance
of doubt, THI has no obligation to store or warehouse the Product, and any such obligation to store or warehouse such Product shall reside solely with Cumberland.
8.4 Latent Defect. In the case of a Latent Defect in any Product, Cumberland shall not be deemed to have accepted such
Product if Cumberland notifies THI in writing of such Latent Defect within sixty (60) days after the time such Latent Defect is discovered by Cumberland, provided that Cumberland’s notice of such Latent Defect is no later than eighteen (18) months
of THI’s Delivery of such Product to Cumberland. If Cumberland’s notice of such Latent Defect is later than six (6) months of THI’s Deliver of such Product to Cumberland, Cumberland shall be deemed to have conclusively accepted such Product, and no
remedy shall be available for Cumberland.
8
8.5 THI shall, at Cumberland’s discretion, (i) if any payment has been made for such Nonconforming Product, refund Cumberland or issue Cumberland a credit against
future billings, an amount equal to the amount paid by Cumberland for such Nonconforming Product, or (ii) fix or replace at THI’s cost such quantity of Nonconforming Product, provided that THI shall also cover Cumberland’s documented cost linked to
such fix or replacement (e.g., transportation cost, transport-related insurance cost, and customs duty). For the avoidance of doubt, the remedy of Cumberland as set forth in this Section 8.5 shall not constitute any waiver of rights or remedies at
law or in equity regarding the foregoing claims or the Nonconforming Product. Cumberland’s remedies under this Section 8.5 shall be cumulative with other remedies it may have under this Agreement.
8.6 Should THI not be in agreement with Cumberland’s claim of a Nonconforming Product, a sample of the alleged Nonconforming Product shall be submitted for analysis to
a mutually acceptable independent testing laboratory of recognized standing in the industry (the “Laboratory”). Should the Parties be unable to agree on a Laboratory, the same shall be ultimately decided by
both Parties’ chief executive officers (or persons holding equivalent management position). The findings of the Laboratory shall be binding for both Parties. The costs and expenses (including the costs and expenses for shipping any replacement
Product) related to such testing shall be borne by THI if the testing confirms the Nonconformity of the Product, otherwise such costs and expenses shall be borne by Cumberland.
8.7 During the Term, THI shall, at THI’s sole cost and expense, perform THI’s obligations under the Assumed Contracts (as defined in the Asset Purchase Agreement
between RDHL and THI entered into contemporaneously herewith) and THI shall take all reasonable actions that are necessary to keep such Assumed Contracts in force.
| 9. |
FINANCIAL PROVISIONS
|
9.1 Revenue Sharing and Reporting. Within thirty (30) days of the end of each calendar month Cumberland will pay THI an
amount equal to fifty percent (50%) of Net Revenue (“THI’s Revenue Share”), less deductions as provided in this Section 9 subject to reconciliation under Section 9.4. Within forty-five (45) days following
the end of each calendar quarter, Cumberland shall reconcile the monthly reports and true up the calculation of THI’s Revenue Share with any underpayment or credit for any overpayments.
9.2 Payment for Transferred Product and Other Product. Cumberland shall pay for all Product (including Transferred
Product) at the applicable Transfer Price within thirty (30) days of sale to a third party.
9.3 Payment of Revenue Share. Cumberland’s payments for Product at the applicable Transfer Price shall be a deduction
from THI’s Revenue Share. Cumberland may only deduct the Transfer Price from THI’s Revenue Share following payment of the Transfer Price by Cumberland.
9.4 Royalties. Cumberland shall pay a Product Royalty to THI in an amount equal to THI’s [*****] less the foregoing
[*****] for the applicable month and reconciled quarterly.
9.5 Payment Method Amounts due to THI under this Agreement will be paid in U.S. dollars, by wire transfer in
immediately available funds to an account THI designates in writing at least fifteen (15) days in advance.
9.6 Cumberland Funding. Cumberland shall provide up to
[*****] in annual funding, as agreed by the Committee. Such annual funding shall include, at a minimum, the following categories of spend: marketing and medical initiatives (including, without limitation, speaker programs and conferences), data
purchase, the cost of the two sales personnel previously promoting the Product, Cumberland’s cost of warehousing and distribution, and costs associated with prior authorization processing. Within thirty (30) days of the Effective Date, the Parties
shall prepare and approve a draft budget schedule to include the allocation of the first year’s funding consistent with the foregoing.
9
9.7 Taxes. Cumberland may deduct from amounts it is required to pay THI pursuant to this Agreement an amount equal to
that withheld for or due on account of any taxes (including VAT to the extent applicable, but other than taxes imposed on or measured by net income of Cumberland) or similar governmental charge imposed by any jurisdiction based on such payments to
THI (“Withholding Taxes”). Cumberland will provide THI with a certificate, evidencing payment of any Withholding Taxes.
9.8 No Warranty. Without limiting Cumberland’s obligations to Commercialize the Product in the Field of Use in the
Territory as set forth herein using commercially reasonable efforts, nothing contained in this Agreement shall be construed as a warranty by Cumberland that any Commercialization to be carried out by it in connection with this Agreement will
actually achieve its aims or any other results and Cumberland makes no warranties whatsoever as to any results to be achieved in consequence of the carrying out of any such Commercialization. Furthermore, unless otherwise agreed by the Parties,
Cumberland makes no representation to the effect that the Commercialization of Product, or any part thereof, will succeed, or that Cumberland shall be able to sell Product in any quantity.
9.9 Pre-Effective Date Economic Allocation. Effective as of the Effective
Date THI shall retain all accounts receivable and bear all obligations and liabilities (including, without limitation, rebates, chargebacks, returns, credits, and similar deductions) arising from Product sold prior to the Effective Date.
| 10. |
RECORD RETENTION AND AUDIT
|
10.1 Record Retention. Throughout the Term, Cumberland will maintain (and will
ensure that its Affiliates maintain) complete and accurate books, records and accounts that fairly reflect Net Revenue and Sublicense Sales Royalties, in sufficient detail to confirm the accuracy of any payments required hereunder, which books,
records and accounts will be retained for five (5) years after the end of the period to which such books, records and accounts pertain.
10.2 Audit. THI will have the right, at its own cost, to have an independent certified public accounting firm of
nationally recognized standing, reasonably acceptable to Cumberland and who agrees to be bound by a customary undertaking of confidentiality (including an undertaking not to disclose to THI any information other than the results of its audit), have
access during normal business hours, and upon reasonable prior written notice, to Cumberland’s records together with any disclosure necessary to explain the same as may be reasonably necessary to verify the accuracy of Net Revenue and THI’s Revenue
Share. The costs of the audit are the responsibility of THI. Any amount determined pursuant to any such audit to have been overpaid or underpaid shall promptly be refunded or paid as applicable.
10.3 Confidentiality. THI will treat all information subject to review under this Section 10 in accordance with the
confidentiality provisions of Section 14 below.
| 11. |
REPRESENTATIONS AND WARRANTIES
|
11.1 By Both Parties. Each Party hereby represents, warrants, and covenants to the other Party as of the Effective Date
as follows:
11.1.1 Corporate Authority. Such Party (a) has the power and authority and the legal right to enter into this Agreement
and perform its obligations hereunder, and (b) has taken all necessary action on its part required to authorize the execution and delivery of this Agreement and the performance of its obligations hereunder. This Agreement has been duly executed and
delivered on behalf of such Party and constitutes a legal, valid and binding obligation of such Party and is enforceable against it in accordance with its terms subject to the effects of bankruptcy, insolvency or other laws of general application
affecting the enforcement of creditor rights and judicial principles affecting the availability of specific performance and general principles of equity, whether enforceability is considered a proceeding at law or equity.
11.1.2 Consents and Approvals. Such Party has obtained all necessary consents, approvals and authorizations from any
federal, state provincial, local or foreign government or subdivision thereof, or any entity, body or authority exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to any federal, state, provincial,
local or foreign government with jurisdiction over the subject matter of the transactions and/or activities contemplated by this Agreement (“Governmental Authority”) and
other parties required to be obtained by such Party in connection with the execution and delivery of this Agreement and the performance of its obligations hereunder.
10
11.1.3 Conflicts. The execution and delivery of this Agreement and the performance of such Party's obligations
hereunder (a) do not conflict with or violate any requirement of applicable law or any provision of the articles of incorporation, bylaws or any similar instrument of such Party, as applicable, in any material way, and (b) do not conflict with,
violate, or breach or constitute a default or require any consent not already obtained under, any contractual obligation or court or administrative order by which such Party is bound.
11.2 By THI. THI hereby further represents, warrants, and covenants to Cumberland that, as of the Effective Date as
follows:
11.2.1 IP Ownership. THI has the sole legal and/or beneficial title to and ownership of the Intellectual Property as is
necessary to grant the License to Cumberland pursuant to this Agreement for Joint Commercialization by Cumberland as intended by this Agreement, and the Intellectual Property are free and clear of any liens, encumbrances or third-party rights
(including without limitation, the right to receive royalties or other compensation). Furthermore, THI undertakes that to the extent that Cumberland, its Affiliates, or any Sublicensee requires a license under any additional patents or related
intellectual property rights controlled by THI for the Commercialization of the Product in the Territory, THI shall grant such license to Cumberland, its Affiliates, and any Sublicensee on a non-exclusive royalty-free basis.
11.2.2 No Conflicting Grants. THI has not, and during the Term of this Agreement shall not, grant any rights to the
Intellectual Property that conflict with the rights granted to Cumberland hereunder, and no third party has any rights whatsoever (including the right to receive royalties or any other compensation) under the Intellectual Property for Product.
11.2.3 Third Party Actions. The exercise of the License by THI or Cumberland will not, to the best
of THI's knowledge, infringe upon the patent or other intellectual property rights of any third party, and no actions, suits, claims, disputes, or proceedings concerning the Intellectual Property or Product are currently pending or have been
threatened, that could have an adverse effect on Product or could impair Cumberland' ability to perform its obligations under this Agreement. Furthermore, there are no legal suits or proceedings by a third party (including without limitation
employees or former employees of THI) contesting the ownership or validity of Intellectual Property or Product or any part thereof, and if it shall become aware of any such third party, THI shall immediately notify Cumberland of such, and
undertakes to effect any payments required (including the payment of royalties or other compensation) to be made to such third party, and to hold Cumberland harmless from, and indemnify Cumberland against, any such claims or payments.
11.2.4 Additional Licenses. To the best of THI’s knowledge and other than as described in this
Agreement, no additional licenses to any patents (including patents owned or controlled by third parties) or know how are required to jointly Commercialize the Product.
11.2.5 Ordinary Course of Business. THI and its Affiliates, vis-à-vis the conduct of
business related to the Product in the Territory, has been in substantially the same manner as conducted in the period January 1, 2025, through the Effective Date. THI and its Affiliates have not, directly or indirectly, taken any action or
actions or entered into any agreements in anticipation of this Agreement that would circumvent the intentions of the Parties as to Joint Commercialization as outlined herein, including but not limited to activities that would reduce market demand
for the Product in the months immediately following the Effective Date, trade loading, or pushing more Product quantities through Product distribution channels than required for current demand.
11.2.6 Key Sales Personnel. THI and its Affiliates will assist and facilitate the transition of
two (2) key sales personnel currently employed by a THI Affiliate to employment by Cumberland promptly following the Effective Date. In the event one or both of the key sales personnel choose not to accept an offer of employment by Cumberland, the
THI or its Affiliate will retain said individuals as THI or Affiliate employees following the Effective Date at Cumberland’s cost and expense, as further agreed by the Parties consistent with Section 9.6 above.
11
11.3 Disclaimer. Other than as stated in this Agreement THI makes no representation or warranty and specifically
disclaims any guarantee that the Commercialization of the Product in the Field of Use in the Territory will be successful, in whole or in part. Other than as stated in Section 11.2, THI expressly disclaims any warranties or conditions, express,
implied, statutory or otherwise with respect to the Intellectual Property.
11.4 By Cumberland. Cumberland further represents, warrants, and covenants to THI that Cumberland and Cumberland
Indemnitees, contractors and vendors will conduct any and all activities, including any Commercialization activities, under this Agreement in compliance with applicable laws using commercially reasonable efforts and in accordance with the terms of
this Agreement.
| 12. |
LIMITATION OF LIABILITY
|
12.1 Except in the cases of liabilities arising from (a) the fraud or willful misrepresentation of a Party, (b) breach of confidentiality obligations of a Party,
and/or (c) indemnification obligations of a Party for payments to third parties under Section 16, in no event shall either Party be liable to the other Party or any of such other Party’s Affiliates for any consequential, incidental, indirect,
special, punitive or exemplary damages (including, without limitation, lost profits, business or goodwill) suffered or incurred by such other Party or its Affiliates, whether based upon a claim or action of contract, warranty, negligence or tort,
or otherwise, arising out of this Agreement.
| 13. |
INTELLECTUAL PROPERTY
|
13.1 Intellectual Property Prosecution and Maintenance; Inventions.
(a) THI undertakes to prosecute and maintain the Intellectual Property using counsel of its choice in the Territory during the Term of this
Agreement. For the avoidance of doubt, as between the Parties and their respective Affiliates, all Intellectual Property relating to the Product, including the formulation, materials, processes, and manufacture of the Product, is and shall remain
the sole and exclusive property of THI, and no rights therein are granted to Cumberland except as strictly required to perform Cumberland’s obligations and for Cumberland to exercise its rights under this Agreement in the Territory in the Field of
Use during the Term.
(b) “THI Improvements” means any inventions, improvements, enhancements, or modifications to the Product or
the Intellectual Property made or conceived during the Term by or on behalf of THI or its Affiliates (or their respective contractors).
(c) “Cumberland Improvements” means any inventions, improvements, enhancements, or modifications to the
Product or the Intellectual Property made or conceived during the Term by or on behalf of Cumberland or its Affiliates, Sublicensees, or its or any of their respective contractors.
(d) “Joint Improvements” means any inventions, improvements, enhancements, or modifications to the Product
or the Intellectual Property made or conceived during the Term by or on behalf of both Parties together.
(e) As between the Parties, THI shall own all THI Improvements and Cumberland shall own all Cumberland Improvements. Joint Improvements shall be
owned jointly by both Parties (without duty of accounting), with the licenses granted below in Section 13.1(f) sufficient for the Joint Commercialization under this Agreement.
(f) License-backs.
(i) THI hereby grants to Cumberland an exclusive, royalty-free license under THI Improvements and Joint Improvements, solely during the Term, in the Territory, and within the
Field of Use, to the extent necessary for Cumberland to perform or otherwise Commercialize the Product and for Cumberland’s obligations and to exercise Cumberland’s rights for the Joint Commercialization of the Product under this Agreement.
12
(ii) Cumberland hereby grants to THI a non-exclusive, royalty-free, perpetual license under Cumberland Improvements and Joint Improvements, to the extent necessary for THI to
make, have made, use, import, sell and otherwise Commercialize the Product, with the right to grant sublicenses to THI’s Affiliates, collaborators, and contract manufacturers solely to enable such activities. The license in this clause 13.1(f)(ii)
shall survive expiration or termination of this Agreement.
(g) Each Party will execute documents reasonably required to effectuate the foregoing in this Section 13.1.
13.2 Intellectual Property Enforcement.
13.2.1 Infringement Notice. If either Party determines that any Intellectual Property is being infringed or
misappropriated by a third party's activities and that such infringement or misappropriation could affect the exercise of the License under this Agreement, it will promptly notify the other Party in writing.
13.2.2 Enforcement. THI will have the sole obligation to remove such infringement and/or misappropriation and to
control all litigation to remove such infringement and/or misappropriation relating to the Product. THI will provide Cumberland with copies of all relevant documentation so that Cumberland will be informed of the continuing action and may comment
upon such documentation sufficiently in advance of any initial deadline for filing a response, provided, however, that if Cumberland has not commented upon such documentation in a reasonable time for THI to sufficiently consider Cumberland’s
comments prior to a deadline, or THI must act to preserve the action, THI will be free to act without consideration of Cumberland’s comments, if any.
13.2.3 Co-operation. The Parties will provide reasonable assistance to each other, including providing access to
relevant documents and other evidence, making its employees available at reasonable business hours, and joining the action to the extent necessary to allow the prosecuting party to maintain the action.
13.2.4 Recovery. Any amounts recovered in connection with or as a result of any action contemplated by Sections 13.2.2
and 13.2.3, whether by settlement or judgement, will be used to reimburse the Parties for their reasonable costs and expenses in making such recovery (which amounts will be allocated pro rata if insufficient to cover the totality of such expenses),
and any remainder will be treated as Net Revenue and payments will be due in respect of same pursuant to this Agreement.
| 14. |
CONFIDENTIALITY
|
14.1 Disclosure and Use Restriction. The Parties agree that during the Term of this Agreement and thereafter, each Party
will keep completely confidential and will not publish, submit for publication or otherwise disclose, and will not use for any purpose except for the purposes contemplated by this Agreement, any Confidential Information (as such term is defined
below) received from the other Party or such Party’s Affiliates. Each Party is responsible for the compliance of their respective Representatives with the terms of this Agreement.
13
14.2 Confidential Information. “Confidential Information” shall mean all information and know-how and any tangible embodiments thereof provided by or on behalf of one Party (or its respective Affiliates) to the other Party (or its respective Affiliates) either in
connection with the discussions and negotiations pertaining to this Agreement or in the course of performing this Agreement, which may include, without limitation, data; knowledge; practices; processes; ideas; research plans; engineering designs
and drawings; research data; manufacturing processes and techniques; scientific, manufacturing, marketing and business plans; and financial and personnel matters relating to the disclosing Party or to its present or future products (including
Product), sales, suppliers, customers, employees, investors or business. Notwithstanding the foregoing, information or know-how of a Party shall not be deemed Confidential Information of such Party for purposes of this Agreement if receiving Party
can demonstrate such information or know-how:
(i) was already known to the receiving Party, other than under an obligation of confidentiality or non-use, at the time of disclosure to such
receiving Party;
(ii) was generally available or known to parties reasonably skilled in the field to which such information or know-how pertains, or was otherwise
part of the public domain, at the time of its disclosure to such receiving Party;
(iii) became generally available or known to parties reasonably skilled in the field to which such information or know-how pertains, or otherwise
became part of the public domain, after its disclosure to such receiving Party through no fault of the receiving Party or its Representatives;
(iv) was disclosed to such receiving Party, other than under an obligation of confidentiality or non-use, by a third party who had no obligation to
the disclosing Party not to disclose such information or know-how to others; or
(v) was independently developed by such receiving Party, as evidenced by their written records, without the use of or access to Confidential
Information of the disclosing Party and prior to any subsequent disclosure by the receiving Party.
All Intellectual Property (including THI Improvements) shall be deemed to be Confidential Information of THI.
14.3 Authorized Disclosure. Notwithstanding the provisions of Section 14.2 above, a Party shall be entitled to disclose
the Confidential Information of the other Party hereto to the extent that such disclosure is:
(i) made in response to a valid order of a court of competent jurisdiction; provided, however, that such
Party will first (to the extent practicably possible) have given notice to such other Party and given such other Party a reasonable opportunity to quash such order and to obtain a protective order requiring that the Confidential Information and
documents that are the subject of such order be held in confidence by such court or agency or, if disclosed, be used only for the purposes for which the order was issued; and provided further that if a
disclosure order is not quashed or a protective order is not obtained, the Confidential Information disclosed in response to such court or governmental order will be limited to that information which is
legally required to be disclosed in response to such court or governmental order;
(ii) otherwise required by law or stock exchange rule; provided, however, that the receiving Party will
provide the disclosing Party with notice of such disclosure in advance thereof to the extent practicably possible and to the extent permitted, will seek confidential treatment of the information disclosed and reasonably cooperate with the efforts
of disclosing Party to seek confidential treatment of the information disclosed and disclose only that portion of the disclosing Party’s Confidential Information required;
(iii) made by such Party to any Regulatory Authority or Governmental Authority as necessary for the development (if authorized by THI) or Joint
Commercialization of Product in a country, as required in connection with any filing, application or request for Regulatory Approval or as required by applicable securities laws and regulations, subject to the limitations in Section 14.3(ii);
(iv) made by such Party in connection with the performance of this Agreement, to its approved Sublicensees, Affiliates, directors, officers,
employees, consultants, representatives or agents (“Representatives”), each of whom prior to disclosure must be bound by obligations of confidentiality and non-use at least equivalent in scope to those set
forth in this Agreement; or
(v) made by such Party in the course of submitting financial accounts to relevant authorities as per local statutory requirements or to existing or
potential acquirers; existing or potential collaborators; investment bankers; existing or potential investors, merger candidates, partners, venture capital firms or other financial institutions or investors for purposes of obtaining financing; or,
bona fide strategic potential partners; each of whom prior to disclosure must be bound by obligations of confidentiality and non-use at least equivalent in scope to those set forth in this Agreement.
14
| 15. | PRESS RELEASES |
15.1 Press releases or other similar public communication by either Party relating to the terms of this Agreement will be approved in advance by the other Party, which
approval will not be unreasonably withheld or delayed. Notwithstanding the foregoing, those communications required by applicable law, regulation or securities exchange rule (including, but not limited to, a public offering prospectus), disclosures
of information for which consent has previously been obtained, and information of a similar nature to that which has been previously disclosed publicly with respect to this Agreement, will not require advance approval, but will be provided to the
other Party as soon as practicable after the release or communication thereof. For the avoidance of doubt, the Parties may issue press releases regarding the fact that this Agreement has been signed and the nature of the agreement so long as they
do not describe the specific provisions hereof without approval from the other Party.
| 16. |
INDEMNIFICATION
|
16.1 Indemnification by THI. THI will defend and hold Cumberland and its Affiliates, and their respective directors,
officers, employees and agents (“Cumberland Parties”) harmless, from and against any and all liability, suits, investigations, claims, actions, judgments, costs,
expenses or demands (including reasonable attorneys’ fees and expenses) (“Losses”) to the extent arising from or occurring as a result of or in connection with a third party claim filed against Cumberland
that is a result of or related to (a) the negligence or willful misconduct on the part of THI in performing any activity contemplated by this Agreement or (b) a breach by THI of any representations, warranties, or covenants set forth in this
Agreement; except to the extent liability or loss arises from or occurs as a result of or in connection with (i) the negligence or willful misconduct on the part of a Cumberland Party; or (ii) a breach by Cumberland of any representations,
warranties or covenants set forth in this Agreement.
16.2 Indemnification by Cumberland. Cumberland will defend and hold THI and THI’s Affiliates, and each of THI’s and
THI’s Affiliates’ respective directors, officers, employees and agents (“THI Parties”), harmless, from and against any and all Losses to the extent arising from or
occurring as a result of or in connection with a third party claim filed against a THI Party that is a result of or related to (a) the negligence or willful misconduct on the part of any Cumberland Party in performing any activity contemplated by
this Agreement; or (b) a breach by Cumberland of any representations, warranties, or covenants set forth in this Agreement; or (c) any Cumberland Party’s exploitation of the Product or Intellectual Property (including THI Improvements), including
any violation of applicable law in connection with such exploitation; except to the extent arising from (i) the negligence or willful misconduct on the part of a THI Party; (ii) a breach by THI of any representations, warranties, or covenants set
forth in this Agreement, or (iii) THI’s obligations pursuant to Section 13.2 of this Agreement.
16.3 Further Indemnification by THI. THI shall further be responsible for and shall indemnify and hold Cumberland
harmless in respect of all royalty and other payments required to be paid to other third parties in respect of Product as a result of a claim by any of THI’s existing or former employees, consultants or shareholders, or any person named in THI’s
patents or patent applications, or any person claiming it should have been named as an inventor in such patent applications.
16.4 Conditions to Indemnity. Each Party's agreement to indemnify and hold the other harmless under this Article
16 is conditioned upon the indemnified Party: (i) providing written notice to the indemnifying Party of any claim, demand or action within thirty (30) days after becoming aware of such claim, demand or action; (ii) permitting the indemnifying Party
to assume full responsibility to investigate, prepare for and defend against any such claim or demand, (iii) assisting the indemnifying Party, at the indemnifying Party's reasonable expense, in the investigation preparation of and defense of any
such claim or demand; and (iv) the indemnifying Party not compromising or settling such claim or demand without the indemnified Party's prior written consent, unless such settlement includes as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified Party a complete release from all liability in respect of such claim or litigation; provided that, if the Party entitled to indemnification fails to promptly
notify the indemnifying Party pursuant to the foregoing clause (i), the indemnifying Party shall only be relieved of its indemnification obligation to the extent it is prejudiced by such failure and provided
further that the indemnified Party is not obligated to notify the indemnifying Party of claims, demands and/or actions made directly against the indemnifying Party only. Notwithstanding the foregoing, if in the reasonable judgment of the
indemnified Party, such suit or claim involves an issue or matter which could have a materially adverse effect on the business, operations or assets of the indemnified Party, the indemnified Party may waive its rights to indemnity under this
Agreement and control the defense or settlement thereof, but in no event shall any such waiver be construed as a waiver of any indemnification rights such indemnified Party may have at law or in equity. If the indemnifying Party defends the suit or
claim, the indemnified Party may participate in (but not control) the defense thereof at its sole cost and expense;
15
16.5 Insurance. Each Party shall (itself or through an Affiliate) obtain and maintain, for the Term of this Agreement
and for three (3) years thereafter, appropriate insurance for Commercialization of the Product, including but not limited to the minimum insurance policies specified below, in the Territory sufficient to cover its obligations under this Agreement
and under applicable law. Minimum insurance policies include: (i) general commercial liability insurance of $1,000,000 per occurrence and $4,000,000 in the aggregate; and (ii) products liability/completed operations coverage of $10,000,000 per
occurrence and $10,000,000 in the aggregate. Such policies shall name the other Party as an additional insured and provide that the other Party will be given thirty (30) days advance written notice of cancellation. Each Party shall provide the
other Party with a certificate of insurance upon request.
| 17. |
TERM AND TERMINATION
|
17.1 Term. Unless earlier terminated in accordance with the provisions of this Article 17, the term of this Agreement
(the “Term”) commences upon the Effective Date and will continue for a period of five (5) years unless terminated in accordance with the terms hereof.
17.2 Termination.
17.2.1 Termination for Breach. Failure by a Party to comply with any of its material obligations contained herein will
entitle the Party not in default to give to the defaulting Party notice specifying the nature of the material breach, requiring the defaulting Party to make good or otherwise cure such material breach, providing specific actions that the defaulting
Party could take to cure such material breach, and stating its intention to invoke the provisions of this Section if such material breach is not cured. If such material breach is not cured within ninety (90) days after the receipt of such notice
(or, if such material breach cannot be cured within such ninety (90)-day period, if the defaulting Party does not commence actions to cure such material breach within such period and thereafter diligently continue such actions), the Party not in
default will be entitled, without limiting any of its other rights conferred on it by this Agreement (except as expressly set forth herein), to terminate this Agreement by providing written notice to the breaching Party.
17.2.2 Voluntary Termination. In addition to the provisions of Section 17.2.1 above, THI may forthwith terminate this
Agreement in THI’s sole discretion upon the occurrence of any of the following events:
(i) Cumberland fails to perform any of its obligations hereunder or makes any material misrepresentation in this Agreement, which, if capable of being cured, has not
been cured within ninety (90) days after written notice by THI (in which THI specifies the nature of such failure or misrepresentation);
(ii) Cumberland enters into any compromise with creditors or a general agreement for referral of payment with its creditor;
(iii) Cumberland makes or suffers to be made any transfer to any person, trustee, receiver, liquidator, or referee for the benefit of creditors;
(iv) Cumberland files a voluntary petition in bankruptcy; and
(v) An involuntary petition in bankruptcy is filed against Cumberland and not dismissed within 60 days of filing.
(vi) Infringement of the License granted herein.
16
17.2.3 Cumberland shall in furtherance of and in addition to the provisions of Section 17.2.1 above, be entitled, in its sole discretion, to terminate this Agreement
upon the occurrence of any of the following events:
(i) THI fails to perform any of its obligations hereunder or makes any material misrepresentation in this Agreement, which has not been cured within
ninety (90) days after written notice by Cumberland (in which Cumberland specifies the nature of such failure or misrepresentation);
(ii) THI enters into any compromise with creditors or a general agreement for referral of payment with its creditor;
(iii) THI makes or suffers to be made any transfer to any person, trustee, receiver, liquidator, or referee for the benefit of creditors;
(iv) THI files a voluntary petition in bankruptcy; and
(v) An involuntary petition in bankruptcy has been filed against THI and not dismissed within sixty (60) days of filing.
17.3 Consequences of Expiration or Termination
17.3.1 License; Payment to THI. Upon expiration or termination of this Agreement, all rights granted to Cumberland under
Section 2.1 (and otherwise under this Agreement) will automatically terminate and all such rights shall automatically revert back to THI; provided that Cumberland shall have a period of one hundred eighty (180) days after the date of expiration or
termination to sell-off all previously purchased Product, subject to all payments required by this Agreement being duly paid to THI. All payments required by this Agreement shall be paid pursuant to the methodology provided for in this Agreement.
Any existing stock of Product not sold off within the one hundred eighty (180) days shall be appropriately dispositioned consistent with applicable law at Cumberland’s cost and expense. In addition, the Parties shall cooperate in good faith during
such period to implement an orderly wind-down and transition of activities back to THI (or its designee). Upon expiration or termination of this Agreement all Sublicenses shall automatically terminate without any notice being required. Upon
expiration or termination of this Agreement, Cumberland shall pay THI any and all amounts due, payable, or owing to THI including, without limitation, THI’s Revenue Share and any amounts due, payable, or owing to THI for Product Delivered to
Cumberland pursuant to the timeframes otherwise provided in this Agreement.
17.3.2 Continuation following THI’s Bankruptcy. The Parties agree that in the event that THI makes a filing under
bankruptcy or similar laws in any jurisdiction, Cumberland shall have the protection afforded to the licensee under the United States Bankruptcy Code, including but not limited to, the protections set forth in 11 U.S.C §365(n) or its equivalent in
any other jurisdiction which allows the licensee, upon rejection of the license agreement by the debtor-licensor or its representative, the option to either retain the licensee’s rights in the intellectual property under the existing contract while
continuing to pay royalties, or to treat the executory contract as terminated. Cumberland must notify THI in writing within sixty (60) days or such longer period allowed by applicable law, of such filing whether it elects to (a) retain its license
rights under this Agreement, in which case it shall continue to perform and pay all obligations hereunder, or (b) treat this Agreement as terminated, in which case Section 17.3.1 shall apply.
17.3.3 Return of Information and Materials. Upon any termination of this Agreement, each Party will return to the other
all Confidential Information of the other Party (except one (1) copy of which may be retained for archival and compliance purposes), Cumberland will return to THI or its designee all Intellectual Property and THI Improvements and any other tangible
materials received by Cumberland under this Agreement and Cumberland will further waive and actively deregister or assign as requested by THI, all Intellectual Property right registrations made hereunder.
17.3.4 Accrued Rights. Termination or expiration of this Agreement for any reason will be without prejudice to any
rights or financial compensation that will have accrued to the benefit of a Party prior to such termination or expiration. Such termination or expiration will not relieve a Party from obligations that are expressly indicated to survive the
termination or expiration of this Agreement.
17.3.5 Survival. Sections 9, 13, 14, 15, 16, and 17.3 of this Agreement will survive expiration or termination of this
Agreement for any reason.
17
| 18. |
MISCELLANEOUS
|
18.1 Assignment. Without the prior written consent of the other Party hereto, neither Party will sell, transfer, assign,
delegate, pledge or otherwise dispose of, whether voluntarily, involuntarily, by operation of law or otherwise, this Agreement or any of its rights or duties hereunder; provided, however, that either Party hereto may assign or transfer this Agreement
or any of its rights or obligations hereunder without the consent of the other Party to any Affiliate, or to any third party successor in interest with which it has merged or consolidated, or to which it has transferred all or substantial part of its
assets or stock to which this Agreement relates . Any purported assignment or transfer in violation of this Section 18.1 will be void ab initio and of no force or effect.
For the Transferred Product under Section 8.2, the Transfer Price shall be the price paid by THI (or its Affiliate) to the contract manufacturer [*****]. For all subsequent Product supplied under Section 8.3, the Transfer Price shall be the [*****]
by THI (or its Affiliate) to the contract manufacturer for the Product (with supporting documentation as requested by Cumberland).
18.2 Severability. Should any term or provision of this Agreement be or become invalid or unenforceable or should this Agreement contain an
omission, the validity or enforceability of the remaining terms or provisions shall not be affected. In such case, subject to the next following sentence, the Parties shall immediately commence to negotiate in good faith in order to replace the
invalid or unenforceable term or provision by such other valid or enforceable term or provision which comes as close as possible to the original intent and effect of the invalid or unenforceable term or provision, or respectively, to fill the
omission by inserting such term or provision which the Parties would have reasonably agreed to, if they had considered the omission at the date hereof. In the event that any term or provision as aforesaid is invalid, void or unenforceable by reason
of its scope, duration or area of applicability or some similar limitation as aforesaid, then the court making such determination shall have the power to reduce the scope, duration, area or applicability of the term or provision so that they shall
be enforceable to the maximum scope, duration, area or applicability permitted by applicable law which shall not exceed those specified in this Agreement or to replace such term or provision with a term or provision that comes closest to expressing
the intention of the invalid or unenforceable term or provision.
18.3 Governing Law; Dispute Resolution. This Agreement shall be governed in all respects by the laws of the State of New York, without giving
effect to any of the conflict of law principles thereof. Following unsuccessful resolution in accordance with Section 4.3, any dispute arising out of or relating to this Agreement, or the breach thereof, shall be finally resolved by binding
arbitration administered by the International Chamber of Commerce (ICC) under the ICC Rules of Arbitration, and judgement upon the award rendered by the arbitrator shall take place in New York, New York, USA. There shall be one (1) arbitrator,
mutually selected and mutually agreed to by the Parties, or named in accordance with such rules. This Section 18.3 shall not prohibit a Party from seeking injunctive relief from a court of competent jurisdiction in the event of a breach or
prospective breach of this Agreement by the other Party, which would cause irreparable harm to the first Party.
18.4 Notices. Any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows, with notice deemed
given as indicated: (a) by personal delivery, when delivered personally; (b) two (2) days following deposit with an reputable international courier for overnight delivery; or (c) by certified or registered mail, return receipt requested, upon
verification of receipt. Notice shall be sent to the addresses set forth above or to such other address as either Party may provide in writing.
| If to Talicia Holdings Inc. to: |
If to Cumberland Pharmaceuticals Inc. to: |
| Talicia Holdings Inc. | Cumberland Pharmaceuticals Inc. |
| 8311 Brier Creek Parkway | 1600 West End Avenue, Suite 1300 |
| Suite 105-161 | Nashville, TN 37203 |
| Raleigh, NC 27617 | USA |
| Attn: Chief Executive Officer | Attn: Chief Executive Officer |
or to such other address as the Party to who notice is to be given may have furnished to the other Party in writing in accordance herewith.
| 18 |
18.5 Entire Agreement; Modifications. This Agreement sets forth and constitutes the entire agreement and understanding between the Parties
with respect to the subject matter hereof and all prior agreements, understanding, promises and representations, whether written or oral, with respect thereto, are superseded hereby. Each Party confirms that it is not relying on any representations
or warranties of the other Party except as specifically set forth herein. No amendment, modification, release or discharge will be binding upon the Parties unless in writing and duly executed by authorized representatives of both Parties.
18.6 Relationship of the Parties. It is expressly agreed that the Parties will be independent contractors of one another and that the
relationship between the Parties will not constitute a partnership, joint venture or agency.
18.7 Waiver. Any term or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no
such waiver will be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving such term or condition. Any such waiver will not be deemed a waiver of any other right or breach hereunder.
18.8 Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument.
18.9 Beneficiaries. The representations, warranties, covenants and agreements set forth in this Agreement are for the sole benefit of the
Parties hereto and their successors and permitted assigns, and they will not be construed as conferring any rights on any other parties.
18.10 Assurances. Each Party will duly execute and deliver, or cause to be duly executed and delivered, such further instruments and do and
cause to be done such further acts and things, including the filing of such assignments, agreements, documents and instruments, as may be necessary to carry out the provisions and purposes of this Agreement.
18.11 Force Majeure. Neither party shall be responsible to the other for failure or delay in performing any of its obligations under this
Agreement (except for any obligations of Cumberland to make payments to THI hereunder) or for other non-performance hereof but only to the extent that such delay or non-performance is occasioned by a cause beyond the reasonable control and without
fault or negligence of such party, including, but not limited to earthquake, fire, flood, explosion, discontinuity in the supply of power, court order or governmental interference, act of God, strike or other labor trouble, act of war or terrorism
and provided that such party will inform the other party as soon as is reasonably practicable and that it will entirely perform its obligations immediately after the relevant cause has ceased its effect. If any such force majeure event continues
for a continuous period of twelve (12) months, the Party whose performance is not prevented by such event may terminate this Agreement with immediate effect by providing the other Party with written notice.
18.12 Securities Law Compliance. Each Party acknowledges that one or more Parties or their parent companies may be publicly traded entities
and, as such, are subject to applicable securities laws and regulations. Each Party agrees to comply, and shall ensure that its Affiliates, Sublicensees, and its and their respective directors, officers, employees, agents, and independent
contractors comply, with all applicable securities laws and regulations in connection with the execution, delivery, and performance of this Agreement. This includes, but is not limited to, compliance with the Securities Act of 1933, the Securities
Exchange Act of 1934, and any rules and regulations promulgated thereunder by the Securities and Exchange Commission, as well as any applicable state securities laws. Each Party shall promptly notify the other Party of any material non-compliance
with such laws and regulations that could reasonably be expected to impact the rights or obligations under this Agreement. Furthermore, each Party shall cooperate with the other Party in providing any necessary information or documentation required
to ensure compliance with applicable securities laws.
18.13 Certification of Non-Debarment. Each Party represents and certifies to the other Party that none of the certifying Party, its
Affiliates nor any of their respective Representatives: (a) has been debarred or is subject to debarment pursuant to Section 306 of the FDCA; (b) is listed on the Department of Health and Human Service’s List of Excluded Individuals/Entities or the
General Services Administration’s Lists of Parties Excluded from Federal Procurement and Non-Procurement Programs, as well as any entities prohibited or excluded from trading with the U.S. pursuant to the U.S. Trade Agreement Act (TAA); or (c) has
received any warning letter, observations, findings or similar from the FDA or other government authorities that have not been remedied as at the Effective Date. Each Party will promptly inform the other Party in the event that the foregoing
certification ceases to be accurate during the Term.
|
[Signature Page to Follow]
|
| 19 |
{Signature Page for Exclusive Joint Commercialization Agreement}
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed by their duly authorized representatives as of the Effective Date.
| Talicia Holdings Inc. |
Cumberland Pharmaceuticals Inc.
|
| Signature: | /s/ Razi Ingber | Signature: | /s/ A.J Kazimi | ||
| Name: |
Razi Ingber | Name: |
A.J. Kazimi | ||
| Title: |
CFO | Title: |
Chief Executive Officer |
Exhibit “A”
Transfer Price
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in this Registration Statement on Form F-1 of RedHill Biopharma Ltd. of our report dated April 10, 2025
relating to the financial statements, which appears in RedHill Biopharma Ltd.’s Annual Report on Form 20-F for the year ended December 31, 2024. We also consent to the reference to us under the heading “Experts” in such Registration Statement.
/s/ Kesselman & Kesselman
Certified Public Accountants (Isr.)
A member firm of PricewaterhouseCoopers International Limited
Tel-Aviv, Israel
December 31, 2025
| Kesselman & Kesselman, 146 Derech Menachem Begin St. Tel-Aviv 6492103, Israel, |
|
P.O Box 7187 Tel-Aviv 6107120, Telephone: +972 -3- 7954555, Fax:+972 -3- 7954556, www.pwc.com/il
|