NOVATO -- Raptor Pharmaceutical Corp. (Nasdaq: RPTP), after steadily growing its pipeline over the past 12 months, will relocate its corporate headquarters to a nearly 31,000-square-foot space at 7 Hamilton Landing, which was formerly occupied by Walt Disney Corp.'s ImageMovers Digital animation studio.
Raptor signed a seven-year lease for the new space, which it plans to move into by mid-2014, according to a filing with the Securities Exchange Commission. The developer of treatments for rare diseases, started in 2005 by former BioMarin executives, has outgrown its current 20,000-square-foot offices at 9 Commercial Blvd. and needs new space to accommodate a steady increase in employees, according to Georgia Erbez, chief financial officer of Raptor.
Although Raptor recently received approval from the Food and Drug Administration for its first commercial product, Procysbi, the expansion is not a direct result of that, Ms. Erbez said.
"We have been searching for new space since last October, as our lease in our current facility expired March 31, 2013 and we have outgrown our existing space, and the capacity of our building," she said.
Under the lease agreement, Raptor will initially move into a smaller adjacent space at 5 Hamilton Landing at a monthly rate of approximately $20,000, according to the SEC filing. Upon moving into the larger space, which Walt Disney Corp. vacated in early 2010, Raptor will pay an initial base rent of about $855,000 during the first year, according to the SEC filing.
Over the past 12 months, Raptor has nearly tripled in size, from 18 employees a year ago to about 50 now, Ms. Erbez said.
"We have been steadily increasing our headcount over the past 12 months and anticipate continued growth in human resources across all functions within Raptor," Ms. Erbez said.
The new space will be for corporate headquarters and not manufacturing Procysbi or other drugs in Raptor's pipeline, which are outsourced to a third-party manufacturer.
Both Raptor and the landlord, Barker Pacific, were represented by Haden Ongaro, Brian Eisberg and Mark Carrington of Cornish & Carey Commercial Newmark Knight Frank in the transaction.
Raptor recently reported a net loss $15.9 million, for the first quarter ended March 31, compared to $14 million in the year prior. The loss was attributed to increased research and development costs for getting Procysbi market approval. The delayed-released capsules treat nephropathic cystinosis, a rare genetic and possibly life-threatening metabolic disorder that affects about 20,000 patients across the world and some 500 in the U.S. In addition, RP103, a potential treatment for Huntington’s disease and nonalcoholic fatty liver disease in children that is currently in Phase 2 clinical trials, contributed to increased R&D costs, according to Raptor.
R&D costs doubled over the year, from $4 million in the first quarter of 2012 to $8.4 million for the quarter ended March 31.
Raptor said it has cash and cash equivalents totaling $58.4 million of cash on hand. The company anticipates another $23.4 million in cash from net proceeds of the second payment from a $50 million loan agreement with Healthcare Royalty Partners, expected to close by the end of this month.