Medical products company Baxter International Inc (NYSE:BAX) announced on Tuesday that it signed a sepsis distribution agreement for TORAYMYXIN PMX-20R (PMX) and the Endotoxin Activity Assay (EAA) with Spectral Medical Inc (TSX:EDT), a late stage theranostic company.

PMX, which is a hemoperfusion filter, is an investigational device in the US that removes endotoxin, which contributes to sepsis, from the bloodstream. The Endotoxin Activity Assay (EAA) is an on-market companion diagnostic tool that aids in the risk assessment of ICU patients for progression to severe sepsis. The use of blood purification filters to remove cytokines and endotoxin from the blood is a promising approach to treat patients with excessive levels of inflammatory mediators, including sepsis, added the company.

Pursuant to the agreement, Spectral will receive a series of milestone payments including a USD5m upfront rights payment from Baxter.

In conjunction, Baxter will be Spectral's exclusive distributor of the PMX filter in the US and Canada as well as awarded the non-exclusive rights to distribute the EAA globally.

Additionally, Spectral has access to Baxter's market capabilities, while retaining control over the PMX regulatory approval process. Baxter has the option to maintain exclusive rights for PMX through future milestone payments and maintaining certain performance obligations.

Concurrently, Spectral's Tigris clinical trial for PMX (www.clinicaltrials.gov: NCT03901807) is underway in the US and the trial is expected to be completed in late 2021. Tigris is a prospective randomized, open labelled trial of 150 patients with a 2:1 randomization favoring the treatment arm. The end point remains a reduction in the 28-day mortality using the PMX filter versus the standard of care.