Shares in Cizzle Biotechnology Holdings PLC (LSE:CIZ) rose 21% to 1.57p after the lung cancer diagnostics developer said its US partner had agreed a further $3.5 million in guaranteed royalty payments ahead of the planned commercial launch of its CIZ1B biomarker test.
York-based Cizzle said its North American licensing partner, Cizzle Bio Inc was in the final stages of the Clinical Laboratory Improvement Amendments accreditation process and expected to submit an application for approval in the second quarter of 2026.
Company executives said staff had been working on site with Cizzle Bio and its clinical diagnostics partner Omni Health Diagnostics Inc at their Richardson, Texas, facility to establish operating procedures and complete validation ahead of submission.
On submission, accreditation is usually immediate unless clarification is sought.
Cizzle said Cizzle Bio had paid $590,000 to date under previously agreed guaranteed advance payments of US$2.4 million due by 31 December 2026.
Management said the companies had now agreed a revised payment schedule under which the remaining US$1.81 million of the initial guaranteed advance royalty payments would be paid before the end of 2026.
Under the licence agreement, which commenced on 18 October 2024, Cizzle is entitled to 10% of gross sales over the initial seven-year term.
Investors were told the agreement had been extended in 2031 with a further minimum guaranteed royalty payment of $3.5 million over the subsequent seven years, equivalent to at least $500,000 a year as part of the ongoing 10% royalty on sales.
Allan Syms, executive chair, said: “I am pleased to announce that the process of preparing for submission of the Company's CIZ1B test for CLIA accreditation is nearing completion.”
He added: “The further guaranteed minimum royalty payments to be paid by BIO over the long term, along with a payment plan aligned with the launch and commercialisation of the test, means that BIO has now confirmed the Company will receive a minimum of US$5.9m over the contract term.”