UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): December 7, 2020
SELLAS Life Sciences Group, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 001-33958 | 20-8099512 | ||
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(State or other jurisdiction of
incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
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7 Times Square, Suite 2503 New York, NY 10036 |
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| (Address of Principal Executive Offices) (Zip Code) | ||||
| Registrant’s telephone number, including area code: (917) 438-4353 | ||||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol(s) | Name of each exchange on which registered |
| Common Stock, $0.0001 par value per share | SLS | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, 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 13(a) of the Exchange Act. ¨
| Item 1.01. | Entry into a Material Definitive Agreement. |
On December 7, 2020, SELLAS Life Sciences Group, Inc. (“SELLAS”) and SLSG Limited, LLC, a wholly-owned subsidiary of SELLAS (“SLSG,” and collectively with SELLAS, the “Company”), entered into an Exclusive License Agreement (the “License Agreement”) with 3D Medicines Inc. (“3DMed”) pursuant to which the Company granted 3D Med a sublicensable, royalty-bearing license, under certain intellectual property owned or controlled by the Company, to develop, manufacture and have manufactured, and commercialize the Company’s galinpepimut-S (“GPS”) and heptavalent GPS (“GPS-Plus”) product candidates (the “Licensed Products”), for all therapeutic and other diagnostic uses (the “Field”) in mainland China, Hong Kong, Macau and Taiwan (the “Territory”). The license is exclusive, except with respect to certain know-how that has been non-exclusively licensed to the Company and is sublicensed to 3DMed on a non-exclusive basis. The Company retains development, manufacturing and commercialization rights with respect to the Licensed Products in the rest of the world.
In partial consideration for the rights granted by the Company, 3DMed agreed to pay to the Company (i) a one-time upfront cash payment of $7.5 million in order to reimburse the Company for certain expenses incurred with respect to the development of the Licensed Products prior to execution of the License Agreement, and (ii) milestone payments totaling up to $194.5 million in the aggregate upon the achievement of certain technology transfer, development and regulatory milestones, as well as certain net sales thresholds of Licensed Products in the Territory in a given calendar year.
3DMed also agreed to pay tiered royalties based upon a percentage of annual net sales of Licensed Products in the Territory ranging from the high single digits to the low double digits. The royalties are payable on a Licensed Product-by-Licensed Product and region-by-region basis commencing on the first commercial sale of a Licensed Product in a region and continuing until the latest of (i) the date that is fifteen years from the receipt of marketing authorization for such Licensed Product in such region and (ii) the date that is ten years from the expiration of the last valid claim of a licensed patent covering or claiming such Licensed Product in such region (collectively, the “Royalty Term”). The royalty rate is subject to reduction under certain circumstances, including when generic competition for a Licensed Product exists in a particular region.
3DMed is responsible for all costs related to developing, obtaining regulatory approval of and commercializing the Licensed Products in the Field in the Territory. 3DMed is required to use commercially reasonable best efforts to develop and obtain regulatory approval for, and upon receipt of regulatory approval, commercialize the Licensed Products in the Field in the Territory. A joint development committee will be established between the Company and 3DMed to coordinate and review the development, manufacturing and commercialization plans with respect to the Licensed Products in the Territory. The Company and 3DMed also agreed to negotiate in good faith the terms and conditions of a clinical supply agreement, a commercial supply agreement, and related quality agreements pursuant to which the Company will manufacture or have manufactured and supply 3DMed with all quantities of the Licensed Product necessary for 3DMed to develop and commercialize the Licensed Products in the Field in the Territory until 3DMed has received all approvals required for 3DMed or its designated contract manufacturing organization to manufacture the Licensed Products in the Territory.
The License Agreement will expire on a Licensed Product-by-Licensed Product and region-by-region basis on the date of the expiration of all of 3DMed’s payment obligations to the Company. Upon expiration of the License Agreement, the license granted to 3DMed will become fully paid-up, perpetual and irrevocable. Either party may terminate the License Agreement for the other party’s material breach following a cure period or upon certain insolvency events. The Company may terminate the License Agreement if 3DMed or its affiliates or sublicensees challenge the validity or enforceability of the licensed patents or if 3DMed fails to timely pay the upfront payment. At any time following the two-year anniversary of the effective date, 3DMed has the right to terminate the License Agreement for convenience, subject to certain requirements. 3DMed may terminate the License Agreement upon prior notice to the Company if the grant of the license to 3DMed is prohibited or delayed for a period of time due to a change of United States export laws and regulations.
The License Agreement includes customary representations and warranties, covenants and indemnification obligations for a transaction of this nature.
The foregoing description of the terms of the License Agreement is not complete and is qualified in its entirety by reference to the full text of the License Agreement, which the Company intends to file as an exhibit to one of the Company’s future filings with the U.S. Securities and Exchange Commission.
| Item 8.01. | Other Events. |
On December 7, 2020, the Company issued a press release announcing its entry into the License Agreement. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits |
| Exhibit Number | Description | |
| 99.1 | Press Release dated December 7, 2020 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SELLAS LIFE SCIENCES GROUP, INC. | ||
| Date: December 10, 2020 | /s/ Barbara A. Wood | |
| Barbara A. Wood | ||
| Executive Vice President, General Counsel and Corporate Secretary | ||
Exhibit 99.1
SELLAS Life Sciences and 3D Medicines Announce Exclusive License Agreement for Development and Commercialization of Galinpepimut-S (GPS) and GPS+ in Greater China
- SELLAS to Potentially Receive Up To $202 Million, Inclusive of $7.5 Million Upfront License Fee and $8 Million Near-term Milestones, plus Tiered Royalties -
- 3D Medicines to Lead Clinical Development and Commercialization of GPS and GPS+
in Greater China -
- SELLAS Retains Rights in the Rest of World, Including United States -
NEW YORK and SHANGHAI, December 7, 2020 -- SELLAS Life Sciences Group, Inc. (Nasdaq: SLS) (“SELLAS”), a late-stage clinical biopharmaceutical company focused on the development of novel cancer immunotherapies for a broad range of cancer indications, and 3D Medicines Inc. (“3DMed”), a China-based biopharmaceutical company developing next-generation immuno-oncology drugs, today announced that they have entered into an Exclusive License Agreement granting rights to 3DMed to develop and commercialize SELLAS’ lead late-stage clinical candidate, galinpepimut-S (GPS), as well as its next generation heptavalent immunotherapeuatic, GPS+, which is at preclinical stage, across all therapeutic and diagnostic uses in the Greater China territory (mainland China, Hong Kong, Macau and Taiwan). SELLAS retains sole rights to GPS and GPS+ outside of the Greater China area. Potential payments to SELLAS under the agreement could total $202 million in license fees and milestone payments, not including future royalties.
GPS is an innovative potentially first-in-class WT1-targeting artificially engineered synthetic heteroclitic immunotherapeutic in development for hematological malignancies and solid tumors characterized by an overexpression of the WT1 (Wilms Tumor Protein) antigen. In 2020, SELLAS commenced a Phase 3 clinical trial (the REGAL study) of GPS in patients with acute myeloid leukemia (AML) who have reached second complete remission.
“This agreement represents an important achievement for SELLAS as we continue to progress our clinical development program for GPS. We are excited to collaborate with 3DMed on the development and commercialization of GPS in China. 3DMed, an ambitious biopharmaceutical company with development, registration and commercialization capabilities with a focus on developing next-generation immuno-oncology drugs and an experienced team, is a wonderfully complementary partner in bringing the potential of GPS to patients in Greater China. The collaboration begins to put in place essential elements designed to expand the reach of GPS outside the United States, following potential regulatory approvals," said Angelos Stergiou, MD, ScD h.c., President and Chief Executive Officer of SELLAS. “The completion of this agreement, amid the COVID-19 pandemic, shows the execution strength of our team. We are also pleased to have strengthened our balance sheet with the non-dilutive upfront license fee of $7.5 million with other potential milestones over the next several months.”
“We are very pleased to execute this exclusive license agreement of GPS and GPS+ in the Greater China area with SELLAS,“ said John Gong, M.D., Ph.D., Chairman and Chief Executive Officer of 3DMed. “GPS and GPS+ are innovative therapeutics and, with growing need for new treatments, GPS’ potential use as a monotherapy as well as in combination with our Envafolimab, an innovative subcutaneous PD-L1 antibody which we have just filed for marketing approval in China, could create significant value for both 3DMed and SELLAS. This partnership highly reflects the vision of 3DMed to help patients with cancer to live longer and better. We believe that the addition of the GPS and GPS+ assets to our clinical portfolio is an important synergistic and strategic step for 3DMed as this partnership will expand our company’s therapeutic area expertise and improve our competitiveness.”
Under the financial terms of the agreement:
| · | SELLAS could potentially receive up to $202 million in license and milestone payments during the course of the collaboration, not including future royalties. |
| · | SELLAS will receive payment of an upfront license fee of $7.5 million payable this quarter and is eligible to receive potential near-term milestones totaling up to an additional $8.0 million. |
| · | SELLAS is entitled to receive royalties on Chinese sales on a tiered basis, dependent on sales levels, ranging from the high single to low double-digit percentage. |
| · | 3DMed will be responsible for the costs of all development and regulatory activity for Greater China. |
Torreya acted as a financial advisor to SELLAS.
About Galinpepimut-S
Galinpepimut-S (GPS) is an innovative and potentially first in class heteroclitic immunotherapy targeting Wilms Tumor 1 (WT1) which is ranked as the #1 cancer antigen by the National Cancer Institute. GPS consists of a mixture of four peptide fragments derived from the WT1 whole-length protein, two of which are artificially mutated by design utilizing the heteroclitic technology principle, aiming at optimal immunogenicity and mitigation of immune tolerance by the vaccinated host. GPS targets 25 carefully selected and validated WT1 antigenic epitopes and is applicable across the majority of HLA types on a global scale. GPS has an off-the-shelf lyophilized formulation and is administered subcutaneously to patients. GPS is optimally positioned either as a maintenance monotherapy in various clinical settings where the residual disease burden after prior debulking is very low, such as complete remission status in AML, or in combination with other therapeutic agents, most notably immune checkpoint inhibitors. In clinical trials, GPS has shown, both as monotherapy and in combination with checkpoint inhibitors, high rates of induction of immunogenicity and the abiitiy to delay disease relapse with an overall low incidence of adverse events, mainly low grade local inoculation reactions, and is currently being evaluated in a Phase 3 clinical trial as monotherapy for AML patients who are in second complete remission and in Phase 1 and Phase 2 studies in combination with checkpoint inhibitors. GPS was granted Orphan Drug Product Designations from the U.S. Food and Drug Administration (FDA), as well as Orphan Medicinal Product Designations from the European Medicines Agency, in AML, malignant pleural mesothelioma (MPM), and multiple myeloma (MM), as well as Fast Track Designation for AML, MPM, and MM from the FDA.
About SELLAS Life Sciences Group, Inc.
SELLAS is a late-stage clinical biopharmaceutical company focused on the development of novel cancer immunotherapeutics for a broad range of cancer indications. SELLAS’ lead product candidate, GPS, is licensed from Memorial Sloan Kettering Cancer Center and targets the WT1 protein, which is present in an array of tumor types. GPS has potential as a monotherapy or in combination to address a broad spectrum of hematologic malignancies and solid tumor indications. SELLAS’ second product candidate, nelipepimut-S (NPS), is a HER2-directed cancer immunotherapy with potential for the treatment of patients with early stage breast cancer with low to intermediate HER2 expression, otherwise known as HER2 1+ or 2+, which includes triple negative breast cancer patients, following standard of care.
For more information on SELLAS, please visit www.sellaslifesciences.com.
About 3D Medicines, Inc.
3D Medicines, Inc. is a biopharmaceutical company at the stage of late clinical development and early commercialization. With the concept “Help people with cancer live longer and better,” aiming for the future long-term survival of tumor patients, 3D Medicines focuses on the development of differentiated next-generation immuno-oncology drugs, to help cancer patients live longer with better quality of life. 3D Medicines has built a pipeline with both innovative biological and small-molecule anti-tumor drugs, and a professional team with global development, registration and commercialization capabilities. For more information, please visit www.3d-medicines.com.
Forward-Looking Statements
This press release contains forward-looking statements. All statements other than statements of historical facts are “forward-looking statements,” including those relating to future events. In some cases, forward-looking statements can be identified by terminology such as “plan,” “expect,” “anticipate,” “may,” “might,” “will,” “should,” “project,” “believe,” “estimate,” “predict,” “potential,” “intend,” or “continue” and other words or terms of similar meaning. These statements include, without limitation, statements related to the Company’s plans for further development of and regulatory plans for GPS, including the timing of clinical results and the potential for GPS as a drug development candidate. These forward-looking statements are based on current plans, objectives, estimates, expectations and intentions, and inherently involve significant risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, risks and uncertainties associated with the COVID-19 pandemic and its impact on the Company’s clinical plans and business strategy, risks and uncertainties associated with immune-oncology product development and clinical success thereof, the uncertainty of regulatory approval, and other risks and uncertainties affecting SELLAS and its development programs as set forth under the caption “Risk Factors” in SELLAS’ Annual Report on Form 10-K filed on March 13, 2020 and in its other SEC filings. Other risks and uncertainties of which SELLAS is not currently aware may also affect SELLAS’ forward-looking statements and may cause actual results and the timing of events to differ materially from those anticipated. The forward-looking statements herein are made only as of the date hereof. SELLAS undertakes no obligation to update or supplement any forward-looking statements to reflect actual results, new information, future events, changes in its expectations or other circumstances that exist after the date as of which the forward-looking statements were made.
Investor Contacts
Adam Holdsworth
PCG Advisory
646-862-4607
adamh@pcgadvisory.com
Investor Relations
SELLAS Life Sciences Group, Inc.
917-438-4353
info@sellaslife.com