ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
33-0655706
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
Large accelerated filer
ý
|
|
Accelerated filer
¨
|
|
Non-accelerated filer
¨
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
¨
|
|
|
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Page No.
|
PART I
|
||
Item 1.
|
||
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||
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||
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||
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 1A.
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||
Item 6.
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||
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|
September 30, 2016
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|
December 31, 2015
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||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
98,507
|
|
|
$
|
188,170
|
|
Available-for-sale securities
|
13,791
|
|
|
57,061
|
|
||
Prepaid expenses and other current assets
|
11,178
|
|
|
9,466
|
|
||
Total current assets
|
123,476
|
|
|
254,697
|
|
||
Property and equipment, net
|
24,451
|
|
|
28,240
|
|
||
Restricted cash
|
1,182
|
|
|
1,681
|
|
||
Long-term receivable (note 11)
|
2,453
|
|
|
1,821
|
|
||
Other assets
|
340
|
|
|
2,382
|
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||
Total assets
|
$
|
151,902
|
|
|
$
|
288,821
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
4,786
|
|
|
$
|
9,628
|
|
Accrued expenses
|
20,679
|
|
|
24,604
|
|
||
Deferred revenue, current
|
—
|
|
|
35,408
|
|
||
Financing obligation, current (note 11)
|
435
|
|
|
416
|
|
||
Total current liabilities
|
25,900
|
|
|
70,056
|
|
||
Deferred revenue, less current portion
|
—
|
|
|
95,531
|
|
||
Deferred rent (note 11)
|
4,527
|
|
|
4,632
|
|
||
Financing obligation, less current portion (note 11)
|
19,262
|
|
|
19,591
|
|
||
Other liabilities
|
92
|
|
|
454
|
|
||
Total liabilities
|
49,781
|
|
|
190,264
|
|
||
Commitments and contingencies
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred Stock, $0.001 par value; 1,000,000 shares authorized, no shares issued and outstanding at September 30, 2016 and December 31, 2015
|
—
|
|
|
—
|
|
||
Common Stock, $0.001 par value; 100,000,000 shares authorized, and 49,587,998
and 49,305,136 shares issued and outstanding, at September 30, 2016 and December 31, 2015, respectively
|
50
|
|
|
49
|
|
||
Additional paid-in capital
|
704,829
|
|
|
694,051
|
|
||
Accumulated deficit
|
(602,759
|
)
|
|
(595,588
|
)
|
||
Accumulated other comprehensive income
|
1
|
|
|
45
|
|
||
Total stockholders’ equity
|
102,121
|
|
|
98,557
|
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||
Total liabilities and stockholders’ equity
|
$
|
151,902
|
|
|
$
|
288,821
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Collaboration revenue
|
$
|
—
|
|
|
$
|
90,743
|
|
|
$
|
18,723
|
|
|
$
|
99,987
|
|
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Research and development
|
12,814
|
|
|
37,729
|
|
|
104,949
|
|
|
160,220
|
|
||||
General and administrative
|
7,120
|
|
|
9,754
|
|
|
33,648
|
|
|
27,713
|
|
||||
Total operating expenses
|
19,934
|
|
|
47,483
|
|
|
138,597
|
|
|
187,933
|
|
||||
Gain on AbbVie Opt-Out (note 9)
|
—
|
|
|
—
|
|
|
112,216
|
|
|
—
|
|
||||
Income (loss) from operations
|
(19,934
|
)
|
|
43,260
|
|
|
(7,658
|
)
|
|
(87,946
|
)
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(305
|
)
|
|
(311
|
)
|
|
(921
|
)
|
|
(1,058
|
)
|
||||
Investment and other income
|
741
|
|
|
75
|
|
|
1,408
|
|
|
298
|
|
||||
Total other income (expense)
|
436
|
|
|
(236
|
)
|
|
487
|
|
|
(760
|
)
|
||||
Income (loss) before income taxes
|
(19,498
|
)
|
|
43,024
|
|
|
(7,171
|
)
|
|
(88,706
|
)
|
||||
Income taxes
|
—
|
|
|
(480
|
)
|
|
—
|
|
|
(480
|
)
|
||||
Net income (loss)
|
$
|
(19,498
|
)
|
|
$
|
42,544
|
|
|
$
|
(7,171
|
)
|
|
$
|
(89,186
|
)
|
Earnings (loss) per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.39
|
)
|
|
$
|
0.85
|
|
|
$
|
(0.15
|
)
|
|
$
|
(1.82
|
)
|
Diluted
|
$
|
(0.39
|
)
|
|
$
|
0.84
|
|
|
$
|
(0.15
|
)
|
|
$
|
(1.82
|
)
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
49,583,776
|
|
|
49,188,443
|
|
|
49,448,725
|
|
|
49,051,836
|
|
||||
Diluted
|
49,583,776
|
|
|
49,764,910
|
|
|
49,448,725
|
|
|
49,051,836
|
|
||||
Other comprehensive loss:
|
|
|
|
|
|
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|
||||||||
Net unrealized holding losses on available-for-sale securities arising during the period
|
(1
|
)
|
|
(104
|
)
|
|
(44
|
)
|
|
(115
|
)
|
||||
Comprehensive income (loss)
|
$
|
(19,499
|
)
|
|
$
|
42,440
|
|
|
$
|
(7,215
|
)
|
|
$
|
(89,301
|
)
|
|
Nine Months Ended September 30,
|
||||||
|
2016
|
|
2015
|
||||
Operating activities
|
|
|
|
||||
Net loss
|
$
|
(7,171
|
)
|
|
$
|
(89,186
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Non-cash gain on AbbVie Opt-Out
|
(112,216
|
)
|
|
—
|
|
||
Depreciation
|
2,566
|
|
|
1,557
|
|
||
Stock-based compensation including 401(k) match
|
10,317
|
|
|
11,180
|
|
||
Impairment of property and equipment
|
771
|
|
|
—
|
|
||
Loss (gain) on sale of fixed assets
|
(488
|
)
|
|
—
|
|
||
Amortization of loan commitment asset
|
—
|
|
|
647
|
|
||
Other, net
|
137
|
|
|
182
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Prepaid expenses and other assets
|
654
|
|
|
4,095
|
|
||
Due from AbbVie
|
—
|
|
|
(130,000
|
)
|
||
Accounts payable, accrued expenses and other liabilities
|
(9,126
|
)
|
|
10,093
|
|
||
Due to Takeda
|
—
|
|
|
(6,667
|
)
|
||
Deferred revenue
|
(18,723
|
)
|
|
30,012
|
|
||
Deferred rent
|
(109
|
)
|
|
1,666
|
|
||
Net cash used in operating activities
|
(133,388
|
)
|
|
(166,421
|
)
|
||
Investing activities
|
|
|
|
||||
Purchases of property and equipment
|
(661
|
)
|
|
(5,416
|
)
|
||
Proceeds from sale of assets
|
1,146
|
|
|
—
|
|
||
Purchases of available-for-sale securities
|
(52,490
|
)
|
|
(64,440
|
)
|
||
Proceeds from maturities of available-for-sale securities
|
11,953
|
|
|
63,841
|
|
||
Proceeds from sales of available-for-sale securities
|
83,625
|
|
|
464
|
|
||
Net cash provided by (used in) investing activities
|
43,573
|
|
|
(5,551
|
)
|
||
Financing activities
|
|
|
|
||||
Proceeds from issuances of common stock related to stock incentive plans and awards
|
444
|
|
|
1,788
|
|
||
Proceeds from issuances of common stock related to employee stock purchase plan
|
18
|
|
|
472
|
|
||
Payments on construction liability
|
—
|
|
|
(273
|
)
|
||
Payments on financing obligation
|
(310
|
)
|
|
(136
|
)
|
||
Net cash provided by financing activities
|
152
|
|
|
1,851
|
|
||
Net decrease in cash and cash equivalents
|
(89,663
|
)
|
|
(170,121
|
)
|
||
Cash and cash equivalents at beginning of period
|
188,170
|
|
|
307,405
|
|
||
Cash and cash equivalents at end of period
|
$
|
98,507
|
|
|
$
|
137,284
|
|
Supplemental cash flow information
|
|
|
|
||||
Cash paid for interest
|
$
|
921
|
|
|
$
|
411
|
|
Cash paid for income taxes
|
$
|
—
|
|
|
$
|
175
|
|
Supplemental schedule of noncash investing and financing activities
|
|
|
|
||||
Property and equipment in accrued expenses
|
$
|
—
|
|
|
$
|
189
|
|
Increase in property and equipment for amount paid by landlord
|
$
|
—
|
|
|
$
|
5,059
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
Stock options
|
7,795,707
|
|
|
5,755,283
|
|
|
7,795,707
|
|
|
8,216,230
|
|
Warrants (excluded from treasury stock method)
|
1,000,000
|
|
|
1,000,000
|
|
|
1,000,000
|
|
|
1,000,000
|
|
Unvested restricted stock
|
1,341,600
|
|
|
—
|
|
|
1,341,600
|
|
|
—
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
(in thousands, except share and per share amounts)
|
||||||||||||||
Basic
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
(19,498
|
)
|
|
$
|
42,544
|
|
|
$
|
(7,171
|
)
|
|
$
|
(89,186
|
)
|
Undistributed earnings allocated to warrants
|
—
|
|
|
(848
|
)
|
|
—
|
|
|
—
|
|
||||
Net income (loss)
|
$
|
(19,498
|
)
|
|
$
|
41,696
|
|
|
$
|
(7,171
|
)
|
|
$
|
(89,186
|
)
|
Weighted average common shares outstanding
|
49,583,776
|
|
|
49,188,443
|
|
|
49,448,725
|
|
|
49,051,836
|
|
||||
Basic earnings (loss) per common share
|
$
|
(0.39
|
)
|
|
$
|
0.85
|
|
|
$
|
(0.15
|
)
|
|
$
|
(1.82
|
)
|
Diluted
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
(19,498
|
)
|
|
$
|
42,544
|
|
|
$
|
(7,171
|
)
|
|
$
|
(89,186
|
)
|
Undistributed earnings allocated to warrants
|
—
|
|
|
(838
|
)
|
|
—
|
|
|
—
|
|
||||
Net income (loss)
|
$
|
(19,498
|
)
|
|
$
|
41,706
|
|
|
$
|
(7,171
|
)
|
|
$
|
(89,186
|
)
|
Weighted average common shares outstanding
|
49,583,776
|
|
|
49,188,443
|
|
|
49,448,725
|
|
|
49,051,836
|
|
||||
Effect of dilutive options
|
—
|
|
|
576,467
|
|
|
—
|
|
|
—
|
|
||||
Weighted average common shares outstanding assuming dilution
|
49,583,776
|
|
|
49,764,910
|
|
|
49,448,725
|
|
|
49,051,836
|
|
||||
Diluted earnings (loss) per common share
|
$
|
(0.39
|
)
|
|
$
|
0.84
|
|
|
$
|
(0.15
|
)
|
|
$
|
(1.82
|
)
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
(in thousands)
|
||||||||||||||
Research and development
|
$
|
1,075
|
|
|
$
|
2,102
|
|
|
$
|
5,041
|
|
|
$
|
6,474
|
|
General and administrative
|
1,714
|
|
|
1,713
|
|
|
5,276
|
|
|
4,706
|
|
||||
Total stock-based compensation expense
|
$
|
2,789
|
|
|
$
|
3,815
|
|
|
$
|
10,317
|
|
|
$
|
11,180
|
|
|
Nine Months Ended September 30,
|
||||
|
2016
|
|
2015
|
||
Risk-free interest rate
|
0.8
|
%
|
|
0.4
|
%
|
Expected annual dividend yield
|
—
|
|
|
—
|
|
Expected stock price volatility
|
63.5
|
%
|
|
60.3
|
%
|
Expected term
|
1.3 years
|
|
|
1.3 years
|
|
|
September 30, 2016
|
||||||||||||||
|
Cost
|
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Estimated
Fair Value |
||||||||
|
(in thousands)
|
||||||||||||||
Cash and cash equivalents due in 90 days or less
|
$
|
98,507
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
98,507
|
|
Available-for-sale securities:
|
|
|
|
|
|
|
|
||||||||
U.S. government-sponsored enterprise obligations due in one year or less
|
13,790
|
|
|
1
|
|
|
—
|
|
|
13,791
|
|
||||
Total available-for-sale securities
|
13,790
|
|
|
1
|
|
|
—
|
|
|
13,791
|
|
||||
Total cash, cash equivalents and available-for-sale securities
|
$
|
112,297
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
112,298
|
|
|
December 31, 2015
|
||||||||||||||
|
Cost
|
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Estimated
Fair Value |
||||||||
|
(in thousands)
|
||||||||||||||
Cash and cash equivalents due in 90 days or less
|
$
|
188,170
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
188,170
|
|
Available-for-sale securities:
|
|
|
|
|
|
|
|
||||||||
Corporate obligations due in one year or less
|
46,049
|
|
|
52
|
|
|
(4
|
)
|
|
46,097
|
|
||||
Asset-backed securities due in one year or less
|
10,967
|
|
|
—
|
|
|
(3
|
)
|
|
10,964
|
|
||||
Total available-for-sale securities
|
57,016
|
|
|
52
|
|
|
(7
|
)
|
|
57,061
|
|
||||
Total cash, cash equivalents and available-for-sale securities
|
$
|
245,186
|
|
|
$
|
52
|
|
|
$
|
(7
|
)
|
|
$
|
245,231
|
|
|
Level 1
|
|
Level 2
|
||||
|
(in thousands)
|
||||||
Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
88,143
|
|
|
$
|
10,364
|
|
U.S. government-sponsored enterprise obligations
|
—
|
|
|
13,791
|
|
||
Total
|
$
|
88,143
|
|
|
$
|
24,155
|
|
•
|
U.S. Government-Sponsored Enterprise Obligations
: benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data including TRACE
®
reported trades.
|
|
September 30, 2016
|
|
December 31, 2015
|
||||
|
(in thousands)
|
||||||
Other prepaid expenses
|
$
|
9,256
|
|
|
$
|
6,898
|
|
Other current assets
|
1,422
|
|
|
1,383
|
|
||
Restricted cash
|
500
|
|
|
—
|
|
||
Short-term receivable (note 11)
|
—
|
|
|
1,185
|
|
||
Total prepaid expenses and other current assets
|
$
|
11,178
|
|
|
$
|
9,466
|
|
|
September 30, 2016
|
|
December 31, 2015
|
||||
|
(in thousands)
|
||||||
Long term prepaid expenses
|
$
|
235
|
|
|
$
|
284
|
|
Long term value-added tax receivable
|
60
|
|
|
2,034
|
|
||
Other assets
|
45
|
|
|
64
|
|
||
Total other assets
|
$
|
340
|
|
|
$
|
2,382
|
|
|
September 30, 2016
|
|
December 31, 2015
|
||||
|
(in thousands)
|
||||||
Accrued restructuring
|
$
|
7,998
|
|
|
$
|
—
|
|
Accrued compensation and benefits
|
2,749
|
|
|
8,732
|
|
||
Accrued drug manufacturing costs
|
304
|
|
|
3,494
|
|
||
Accrued clinical studies
|
6,375
|
|
|
8,531
|
|
||
Accrued preclinical studies
|
142
|
|
|
539
|
|
||
Deferred rent, current
|
258
|
|
|
261
|
|
||
Other
|
2,853
|
|
|
3,047
|
|
||
Total accrued expenses
|
$
|
20,679
|
|
|
$
|
24,604
|
|
|
Charges incurred during the nine months ended September 30, 2016
|
|
Amounts paid through September 30, 2016
|
|
Less non-cash charges during the nine months ended September 30, 2016
|
|
Amounts accrued at September 30, 2016
|
||||||||
|
(in thousands)
|
||||||||||||||
Employee severance, benefits and related costs for work force reduction
|
$
|
13,791
|
|
|
$
|
5,226
|
|
|
$
|
907
|
|
|
$
|
7,658
|
|
Long-lived asset impairment
|
1,324
|
|
|
—
|
|
|
1,324
|
|
|
—
|
|
||||
Contract termination, prepaid expense write-offs and other related costs
|
1,806
|
|
|
424
|
|
|
1,042
|
|
|
340
|
|
||||
Total restructuring
|
$
|
16,921
|
|
|
$
|
5,650
|
|
|
$
|
3,273
|
|
|
$
|
7,998
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
the consideration is commensurate with either (1) our performance to achieve the milestone, or (2) the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from our performance to achieve the milestone,
|
•
|
the consideration relates solely to past performance, and
|
•
|
the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement.
|
•
|
compensation of personnel associated with research and development activities;
|
•
|
clinical testing costs, including payments made to contract research organizations;
|
•
|
costs of comparator drugs used in clinical studies;
|
•
|
costs of purchasing laboratory supplies and materials;
|
•
|
costs of manufacturing product candidates for preclinical testing and clinical studies;
|
•
|
costs associated with the licensing of research and development programs;
|
•
|
preclinical testing costs, including costs of toxicology studies;
|
•
|
fees paid to external consultants;
|
•
|
fees paid to professional service providers for independent monitoring and analysis of our clinical trials;
|
•
|
costs for collaboration partners to perform research activities, including development milestones for which a payment is due when achieved;
|
•
|
depreciation of equipment; and
|
•
|
allocated costs of facilities.
|
|
Three Months Ended September 30,
|
|
$ Change
|
|
% Change
|
|||||||||
|
2016
|
|
2015
|
|
||||||||||
|
(in thousands)
|
|||||||||||||
Collaboration revenue
|
$
|
—
|
|
|
$
|
90,743
|
|
|
$
|
(90,743
|
)
|
|
(100
|
)%
|
Research and development expense
|
(12,814
|
)
|
|
(37,729
|
)
|
|
24,915
|
|
|
(66
|
)%
|
|||
General and administrative expense
|
(7,120
|
)
|
|
(9,754
|
)
|
|
2,634
|
|
|
(27
|
)%
|
|||
Interest expense
|
(305
|
)
|
|
(311
|
)
|
|
6
|
|
|
(2
|
)%
|
|||
Investment and other income
|
741
|
|
|
75
|
|
|
666
|
|
|
888
|
%
|
|||
Income taxes
|
—
|
|
|
(480
|
)
|
|
480
|
|
|
(100
|
)%
|
|
Nine Months Ended September 30,
|
|
$ Change
|
|
% Change
|
|||||||||
|
2016
|
|
2015
|
|
||||||||||
|
(in thousands)
|
|||||||||||||
Collaboration revenue
|
$
|
18,723
|
|
|
$
|
99,987
|
|
|
$
|
(81,264
|
)
|
|
(81
|
)%
|
Research and development expense:
|
|
|
|
|
|
|
|
|||||||
Programs
|
(104,949
|
)
|
|
(107,720
|
)
|
|
2,771
|
|
|
(3
|
)%
|
|||
Takeda payments
|
—
|
|
|
(52,500
|
)
|
|
52,500
|
|
|
(100
|
)%
|
|||
Total research and development expense
|
(104,949
|
)
|
|
(160,220
|
)
|
|
55,271
|
|
|
(34
|
)%
|
|||
General and administrative expense
|
(33,648
|
)
|
|
(27,713
|
)
|
|
(5,935
|
)
|
|
21
|
%
|
|||
Gain on AbbVie Opt-Out (note 9)
|
112,216
|
|
|
—
|
|
|
112,216
|
|
|
—
|
|
|||
Interest expense
|
(921
|
)
|
|
(1,058
|
)
|
|
137
|
|
|
(13
|
)%
|
|||
Investment and other income
|
1,408
|
|
|
298
|
|
|
1,110
|
|
|
372
|
%
|
|||
Income taxes
|
—
|
|
|
(480
|
)
|
|
480
|
|
|
(100
|
)%
|
Program
|
Three Months Ended September 30, 2016
|
|
Three Months Ended September 30, 2015
|
|
Nine Months Ended September 30, 2016
|
|
Nine Months Ended September 30, 2015
|
|
January 1, 2006 to
September 30, 2016
|
||||||||||
|
(in millions)
|
||||||||||||||||||
PI3K inhibitor (1)
|
$
|
14.5
|
|
|
$
|
35.6
|
|
|
$
|
102.8
|
|
|
$
|
153.1
|
|
|
$
|
575.2
|
|
Hsp90 inhibitor
|
—
|
|
|
—
|
|
|
|
|
0.1
|
|
|
137.8
|
|
||||||
Hedgehog pathway inhibitor
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
164.1
|
|
(1)
|
Includes both duvelisib and IPI-549. Includes an upfront license fee of $13.5 million in 2010, $4 million in development milestones in 2011, $14.4 million recorded as fair value for the release payment for the amended and restated Takeda agreement and $6 million in development milestones in 2012, $10 million development milestone payment and a $5 million option fee payment in 2014, as well as a $52.5 million payment related to the exercise of this option to Takeda in 2015.
|
•
|
the nature, timing and estimated costs of the efforts necessary to complete the development of our programs;
|
•
|
the completion dates of these programs; or
|
•
|
the period in which material net cash inflows are expected to commence, if at all, from the programs described above and any potential future product candidates.
|
•
|
the scope, rate of progress and cost of our clinical trials that we are currently conducting or may commence in the future;
|
•
|
the scope and rate of progress of our preclinical studies and other research and development activities;
|
•
|
clinical trial results;
|
•
|
the cost of establishing clinical supplies of any product candidates;
|
•
|
the cost and availability of comparator drugs;
|
•
|
the cost of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights relating to our programs under development;
|
•
|
the terms and timing of any strategic alliance, licensing and other arrangements that we have or may establish in the future relating to our programs under development;
|
•
|
the cost and timing of regulatory approvals; and
|
•
|
the effect of competing technological and market developments.
|
|
September 30, 2016
|
|
December 31, 2015
|
||||
|
(in thousands)
|
||||||
Cash, cash equivalents and available-for-sale securities
|
$
|
112,298
|
|
|
$
|
245,231
|
|
Working capital
|
97,576
|
|
|
184,641
|
|
|
Nine Months Ended September 30,
|
||||||
|
2016
|
|
2015
|
||||
|
(in thousands)
|
||||||
Cash provided by (used in):
|
|
|
|
||||
Operating activities
|
$
|
(133,388
|
)
|
|
$
|
(166,421
|
)
|
Takeda payments (included in operating activities above)
|
—
|
|
|
(59,167
|
)
|
||
Investing activities
|
43,573
|
|
|
(5,551
|
)
|
||
Capital expenditures (included in investing activities above)
|
(661
|
)
|
|
(5,416
|
)
|
||
Financing activities
|
152
|
|
|
1,851
|
|
|
Charges incurred during the nine months ended September 30, 2016
|
|
Amounts paid through September 30, 2016
|
|
Less non-cash charges during the nine months ended September 30, 2016
|
|
Amounts accrued at September 30, 2016
|
||||||||
|
(in thousands)
|
||||||||||||||
Employee severance, benefits and related costs for work force reduction
|
$
|
13,791
|
|
|
$
|
5,226
|
|
|
$
|
907
|
|
|
$
|
7,658
|
|
Long-lived asset impairment
|
1,324
|
|
|
—
|
|
|
1,324
|
|
|
—
|
|
||||
Contract termination, prepaid expense write-offs and other related costs
|
1,806
|
|
|
424
|
|
|
1,042
|
|
|
340
|
|
||||
Total restructuring
|
$
|
16,921
|
|
|
$
|
5,650
|
|
|
$
|
3,273
|
|
|
$
|
7,998
|
|
•
|
the scope, progress, results and costs of researching and developing IPI-549 currently in clinical development;
|
•
|
our ability to secure alternative leasing or subleasing arrangements for our current lease and to achieve related cost savings;
|
•
|
our ability to realize the planned cost savings benefits of a strategic restructurings we effected in June and September 2016, which included a significant reduction in our workforce, in order to preserve capital to support the development of IPI-549;
|
•
|
the timing of, and the costs involved in, obtaining regulatory approvals for IPI-549;
|
•
|
the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patent claims, including litigation costs and the outcome of such litigation;
|
•
|
the absence of any breach, acceleration event or event of default under any agreements with third parties;
|
•
|
the outcome of any lawsuits that could be brought against us;
|
•
|
the cost of acquiring raw materials for, and of manufacturing, our product candidates is higher than anticipated;
|
•
|
the cost or quantity required of comparator drugs used in clinical studies increases; and
|
•
|
a loss in our investments due to general market conditions or other reasons.
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1A.
|
Risk Factors
|
•
|
the scope, progress, results and costs of developing IPI-549, currently in clinical development;
|
•
|
our ability to realize the planned cost savings benefits of strategic restructurings we effected in 2016, which included a significant reduction in our workforce, in order to preserve capital to support the development of IPI-549;
|
•
|
our ability to secure alternative leasing or subleasing arrangements for our current leases and to achieve related cost savings;
|
•
|
the timing of, and the costs involved in, obtaining regulatory approvals for IPI-549;
|
•
|
our ability to effectively transition the duvelisib program to Verastem;
|
•
|
the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patent claims, including litigation costs and the outcome of such litigation;
|
•
|
the absence of any breach, acceleration event or event of default under any agreements with third parties;
|
•
|
the outcome of any lawsuits that could be brought against us;
|
•
|
the cost of acquiring raw materials for, and of manufacturing, our product candidates is higher than anticipated;
|
•
|
the cost or quantity required of comparator drugs used in clinical studies increases; and
|
•
|
a loss in our investments due to general market conditions or other reasons.
|
•
|
initiation and successful enrollment and completion of clinical trials, including in combination with other agents;
|
•
|
a safety, tolerability and efficacy profile that is satisfactory to the U.S. Food and Drug Administration, or FDA, or any comparable foreign regulatory authority for marketing approval;
|
•
|
timely receipt of marketing approvals from applicable regulatory authorities;
|
•
|
the extent of any required post-marketing approval commitments to applicable regulatory authorities;
|
•
|
establishment of supply arrangements with third-party raw materials suppliers and manufacturers;
|
•
|
establishment of arrangements with third-party manufacturers to obtain finished drug product that is appropriately packaged for sale;
|
•
|
adequate ongoing availability of raw materials and drug product for clinical development and any commercial sales;
|
•
|
obtaining and maintaining patent, trade secret protection and regulatory exclusivity, both in the United States and internationally;
|
•
|
protection of our rights in our intellectual property portfolio;
|
•
|
successful launch of commercial sales following any marketing approval;
|
•
|
a continued acceptable safety profile following any marketing approval;
|
•
|
commercial acceptance by patients, the medical community and third-party payors; and
|
•
|
our ability to compete with other therapies.
|
•
|
unfavorable results of discussions with the FDA or comparable foreign authorities regarding the scope or design of our clinical trials;
|
•
|
delays in receiving, or the inability to obtain, required approvals from institutional review boards or other reviewing entities at clinical sites selected for participation in our clinical trials;
|
•
|
delays in enrolling patients into clinical trials;
|
•
|
a lower than anticipated retention rate of patients in clinical trials;
|
•
|
the need to repeat or discontinue clinical trials as a result of inconclusive or negative results or unforeseen complications in testing or because the results of later trials may not confirm positive results from earlier preclinical studies or clinical trials;
|
•
|
inadequate supply, delays in distribution or deficient quality of, or inability to purchase or manufacture drug product, comparator drugs or other materials necessary to conduct our clinical trials;
|
•
|
unfavorable FDA or other foreign regulatory inspection and review of a clinical trial site, Infinity, or an Infinity vendor, or records of any clinical or preclinical investigation;
|
•
|
serious and unexpected drug-related side effects experienced by participants in our clinical trials, which may occur even if they were not observed in earlier trials or only observed in a limited number of participants;
|
•
|
a finding that the trial participants are being exposed to unacceptable health risks;
|
•
|
the placement by the FDA or a foreign regulatory authority of a clinical hold on a trial; or
|
•
|
any restrictions on, or post-approval commitments with regard to, any regulatory approval we ultimately obtain that render the product candidate not commercially viable.
|
•
|
regulators or institutional review boards may not authorize us, any collaborators or our or their investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site;
|
•
|
we, or any collaborators, may have delays in reaching or fail to reach agreement on acceptable clinical trial contracts or clinical trial protocols with prospective trial sites;
|
•
|
clinical trials of IPI-549 may produce unfavorable or inconclusive results;
|
•
|
we, or any collaborators, may decide, or regulators may require us or them, to conduct additional clinical trials or abandon IPI-549;
|
•
|
the number of patients required for clinical trials of IPI-549 may be larger than we, or any collaborators, anticipate, patient enrollment in these clinical trials may be slower than we, or any collaborators, anticipate or participants may drop out of these clinical trials at a higher rate than we, or any collaborators, anticipate;
|
•
|
the cost of planned clinical trials of IPI-549 may be greater than we anticipate;
|
•
|
our third-party contractors or those of any collaborators, including those manufacturing IPI-549 or components or ingredients thereof or conducting clinical trials on our behalf or on behalf of any collaborators, may fail to comply with regulatory requirements or meet their contractual obligations to us or any collaborators in a timely manner or at all;
|
•
|
patients that enroll in a clinical trial may misrepresent their eligibility to do so or may otherwise not comply with the clinical trial protocol, resulting in the need to drop the patients from the clinical trial, increase the needed enrollment size for the clinical trial or extend the clinical trial’s duration;
|
•
|
we, or any collaborators, may have to delay, suspend or terminate clinical trials of IPI-549 for various reasons, including a finding that the participants are being exposed to unacceptable health risks, undesirable side effects or other unexpected characteristics of IPI-549;
|
•
|
regulators or institutional review boards may require that we, or any collaborators, or our or their investigators suspend or terminate clinical research for various reasons, including noncompliance with regulatory requirements or their standards of conduct, a finding that the participants are being exposed to unacceptable health risks, undesirable side effects or other unexpected characteristics of IPI-549 or findings of undesirable effects caused by a chemically or mechanistically similar product or product candidate;
|
•
|
the FDA or comparable foreign regulatory authorities may disagree with our, or any collaborators’, clinical trial designs or our or their interpretation of data from preclinical studies and clinical trials;
|
•
|
the FDA or comparable foreign regulatory authorities may fail to approve or subsequently find fault with the manufacturing processes or facilities of third-party manufacturers with which we, or any collaborators, enter into agreements for clinical and commercial supplies;
|
•
|
the supply or quality of raw materials or manufactured product candidates or other materials necessary to conduct clinical trials of IPI-549 may be insufficient, inadequate or not available at an acceptable cost, or we may experience interruptions in supply; and
|
•
|
the approval policies or regulations of the FDA or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient to obtain marketing approval.
|
•
|
the size and nature of the patient population;
|
•
|
the severity of the disease under investigation;
|
•
|
the nature and complexity of the trial protocol, including eligibility criteria for the trial;
|
•
|
the number of clinical trial sites and the proximity of patients to those sites;
|
•
|
standard of care in disease under investigation;
|
•
|
the commitment of clinical investigators to identify eligible patients;
|
•
|
competing studies or trials; and
|
•
|
clinicians’ and patients’ perceptions as to the potential advantages and risks of the drug being studied in relation to other available therapies, including any new drugs that may be approved for the indications we are investigating.
|
•
|
the inclusion of a placebo arm in a trial;
|
•
|
possible inactivity or low activity of the product candidate being tested at one or more of the dose levels being tested;
|
•
|
the occurrence of adverse side effects, whether or not related to the product candidate; and
|
•
|
the availability of numerous alternative treatment options, including clinical trials evaluating competing product candidates, that may induce patients to discontinue their participation in the trial.
|
•
|
timing of our receipt of any marketing approvals, the terms of any such approvals and the countries in which any such approvals are obtained;
|
•
|
timing of market introduction of competitive products;
|
•
|
lower demonstrated clinical safety or efficacy, or less convenient or more difficult route of administration, compared to competitive products;
|
•
|
lack of cost-effectiveness;
|
•
|
lack of reimbursement from government payors, managed care plans and other third-party payors;
|
•
|
prevalence and severity of side effects;
|
•
|
potential advantages of alternative treatment methods;
|
•
|
whether the product is designated under physician treatment guidelines as a first, second or third line therapy;
|
•
|
changes in the standard of care for the targeted indications for the product;
|
•
|
limitations or warnings, including distribution or use restrictions, contained in the product’s approved labeling;
|
•
|
safety concerns with similar products marketed by others;
|
•
|
the reluctance of the target population to try new therapies and of physicians to prescribe those therapies;
|
•
|
the lack of success of our physician education programs; and
|
•
|
ineffective sales, marketing and distribution support.
|
•
|
decides not to devote the necessary resources because of internal constraints, such as limited personnel with the requisite scientific or commercial expertise, limited cash resources or specialized equipment limitations;
|
•
|
decides not to pursue development and commercialization of the program or to continue or renew development or commercialization programs, based on clinical trial results, changes in the collaborators’ strategic focus or available funding, the belief that other product candidates may have a higher likelihood of obtaining regulatory approval or potential to generate a greater return on investment, or external factors, such as an acquisition, that divert resources or create competing priorities;
|
•
|
does not perform its obligations as expected;
|
•
|
does not have sufficient resources necessary or is otherwise unable to carry the program through clinical development, regulatory approval and commercialization;
|
•
|
cannot obtain the necessary regulatory approvals;
|
•
|
delays clinical trials, provides insufficient funding for a clinical trial program, stops a clinical trial or abandons the program, repeats or conducts new clinical trials or requires a new formulation of the program for clinical testing;
|
•
|
independently develops, or develops with third parties, products that compete directly or indirectly with the program;
|
•
|
does not commit sufficient resources to the marketing and distribution of such product or products;
|
•
|
does not properly maintain or defend our intellectual property rights or uses our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation;
|
•
|
infringes the intellectual property rights of third parties, which may expose us to litigation and potential liability; or
|
•
|
terminates the collaboration prior to its completion.
|
•
|
pay substantial damages;
|
•
|
stop developing, manufacturing and/or commercializing IPI-549;
|
•
|
develop non-infringing product candidates, technologies and methods; and
|
•
|
obtain one or more licenses from other parties, which could result in our paying substantial royalties or the granting of cross-licenses to our technologies.
|
•
|
restrictions on such products, manufacturers or manufacturing processes;
|
•
|
restrictions on the labeling or marketing of a product;
|
•
|
restrictions on distribution or use of a product;
|
•
|
requirements to conduct post-marketing studies or clinical trials;
|
•
|
warning letters or untitled letters;
|
•
|
withdrawal of the products from the market;
|
•
|
refusal to approve pending applications or supplements to approved applications that we submit;
|
•
|
recall of products;
|
•
|
damage to relationships with any potential collaborators;
|
•
|
unfavorable press coverage and damage to our reputation;
|
•
|
fines, restitution or disgorgement of profits or revenues;
|
•
|
suspension or withdrawal of marketing approvals;
|
•
|
refusal to permit the import or export of our products;
|
•
|
product seizure;
|
•
|
injunctions or the imposition of civil or criminal penalties; and
|
•
|
litigation involving patients using our products.
|
•
|
the federal Anti-Kickback Statute prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation or arranging of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid;
|
•
|
the federal False Claims Act imposes criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for, among other things, knowingly presenting, or causing to be presented, false or fraudulent claims for payment by a federal healthcare program or making a false statement or record material to payment of a false claim or avoiding, decreasing or concealing an obligation to pay money to the federal government, with potential liability including mandatory treble damages and significant per-claim penalties, currently set at $5,500 to $11,000 per false claim;
|
•
|
the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters;
|
•
|
HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act and its implementing regulations, also imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information;
|
•
|
the federal Physician Payments Sunshine Act requires applicable manufacturers of covered drugs to report payments and other transfers of value to physicians and teaching hospitals; and
|
•
|
analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws and transparency statutes, may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third party payors, including private insurers.
|
•
|
an annual, non-deductible fee on any entity that manufactures or imports specified branded prescription drugs and biologic agents;
|
•
|
an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program;
|
•
|
a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected;
|
•
|
expansion of healthcare fraud and abuse laws, including the civil False Claims Act and the federal Anti-Kickback Statute, new government investigative powers and enhanced penalties for noncompliance;
|
•
|
a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D;
|
•
|
extension of manufacturers’ Medicaid rebate liability to individuals enrolled in Medicaid managed care organizations;
|
•
|
expansion of eligibility criteria for Medicaid programs;
|
•
|
expansion of the entities eligible for discounts under the Public Health Service pharmaceutical pricing program;
|
•
|
new requirements to report certain financial arrangements with physicians and teaching hospitals;
|
•
|
a new requirement to annually report drug samples that manufacturers and distributors provide to physicians;
|
•
|
a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research;
|
•
|
a new Independent Payment Advisory Board, or IPAB, which has authority to recommend certain changes to the Medicare program to reduce expenditures by the program that could result in reduced payments for prescription drugs; and
|
•
|
established the Center for Medicare and Medicaid Innovation within CMS to test innovative payment and service delivery models.
|
•
|
the results of our current and any future clinical trials of IPI-549;
|
•
|
the timing and costs associated with the wind-down of our involvement with duvelisib;
|
•
|
future sales of, and the trading volume in, our common stock;
|
•
|
announcements of strategic transactions relating to our programs or our company;
|
•
|
our entry into key agreements, including those related to the acquisition or in-licensing of new programs, or the termination of key agreements, including our amended and restated development and license agreement with Takeda or the Verastem Agreement;
|
•
|
the results and timing of regulatory reviews relating to the approval of IPI-549;
|
•
|
the initiation of, material developments in, or conclusion of litigation, including but not limited to litigation to enforce or defend any of our intellectual property rights or to defend product liability claims;
|
•
|
the failure of IPI-549, if approved, to achieve commercial success;
|
•
|
the results of clinical trials conducted by others on drugs that would compete with IPI-549;
|
•
|
the regulatory approval of drugs that would compete with IPI-549;
|
•
|
issues in manufacturing IPI-549;
|
•
|
the loss of key employees;
|
•
|
changes in estimates or recommendations, or publication of inaccurate or unfavorable research about our business, by securities analysts who cover our common stock;
|
•
|
future financings through the issuance of equity or debt securities or otherwise;
|
•
|
healthcare reform measures, including changes in the structure of healthcare payment systems;
|
•
|
our cash position and period-to-period fluctuations in our financial results; and
|
•
|
general and industry-specific economic and/or capital market conditions.
|
•
|
delaying, deferring or preventing a change in control of Infinity;
|
•
|
impeding a merger, consolidation, takeover or other business combination involving Infinity; or
|
•
|
discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control of Infinity.
|
Item 6.
|
Exhibits
|
|
INFINITY PHARMACEUTICALS, INC.
|
||
Date: November 9, 2016
|
By:
|
|
/s/ L
AWRENCE
E. B
LOCH
, M.D., J.D.
|
|
|
|
Lawrence E. Bloch, M.D., J.D.
|
|
|
|
Executive Vice President, Chief Financial Officer and Chief Business Officer
|
|
|
|
(Principal Financial Officer & Principal Accounting Officer)
|
|
|
Description
|
|
Incorporated by Reference
|
||||||||
Exhibit No.
|
|
|
Form
|
|
SEC
Filing
date
|
|
Exhibit
Number
|
|
Filed
with
this
10-Q
|
|||
3.1
|
|
|
Restated Certificate of Incorporation of the Registrant.
|
|
10-Q
|
|
8/9/2007
|
|
3.1
|
|
|
|
3.2
|
|
|
Amended and Restated Bylaws of the Registrant.
|
|
8-K
|
|
3/17/2009
|
|
3.1
|
|
|
|
4.1
|
|
|
Form of Common Stock Certificate.
|
|
10-K
|
|
3/14/2008
|
|
4.1
|
|
|
|
10.1
|
|
|
Second Amendment to Amended and Restated Development and License Agreement, dated September 27, 2016, by and between the Registrant and Intellikine LLC.
|
|
|
|
|
|
|
|
X
|
|
31.1
|
|
|
Certification of principal executive officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended. Filed herewith.
|
|
|
|
|
|
|
|
X
|
|
31.2
|
|
|
Certification of principal financial officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended. Filed herewith.
|
|
|
|
|
|
|
|
X
|
|
32.1
|
|
|
Certification of principal executive officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith.
|
|
|
|
|
|
|
|
X
|
|
32.2
|
|
|
Certification of principal financial officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith.
|
|
|
|
|
|
|
|
X
|
|
101
|
|
|
The following materials from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations and Comprehensive Loss, (iii) the Condensed Consolidated Statements of Cash Flows, and (iv) Notes to Condensed Consolidated Financial Statements. Filed herewith.
|
|
|
|
|
|
|
|
X
|
1.
|
Definitions
.
|
1.1
|
“
IPI-145 Product Field
” means the treatment, prevention, palliation or diagnosis of any disease, disorder, syndrome or condition in humans and/or animals or ex-vivo uses.
|
1.2
|
“
Qualifying
Transaction
” means any of one or more agreements entered into between Infinity (or any of its Affiliates) and one or more Third Parties pursuant to which Infinity or one or more of its Affiliates (a) grants a (sub)license of rights under the Intellikine Intellectual Property, Intellikine Additional Patents, Intellikine Other Technology, Intellikine Background Technology or Infinity Intellectual Property to use, develop and/or commercialize the IPI-145 Product in one or more countries in the Territory and in respect of one or more indications in the IPI-145 Product Field, or (b) sells, in an asset sale, any rights of Infinity and its Affiliates necessary to practice the IPI-145 Product in the IPI-145 Product Field.
|
1.3
|
“
Qualifying Transaction
Revenue
” means all consideration, in whatever form, received by Infinity or any of its Affiliates from one or more Third Parties in all Qualifying Transactions, solely as such consideration relates to the IPI-145 Product, excluding consideration in the form of: (a) reimbursements of Infinity’s or any of its Affiliates’ actual internal or out-of-pocket costs related to the IPI-145 Product incurred after June 30, 2016, regardless of the form or timing of such reimbursement (for example, and without limitation, whether such reimbursement is paid as an up-front payment, a milestone payment or a contingent payment of any kind); (b) payment on behalf of, or reimbursement to, Infinity or any of its Affiliates of reasonable out-of-pocket costs actually incurred or paid in the filing, prosecution, maintenance, enforcement or defense of any of the Intellikine Patents or Infinity Patents; (c) that portion of the amounts received by Infinity or any of its Affiliates as a result of enforcement of intellectual property rights related to the IPI-145 Product which (i) reimburse Infinity or its Affiliates for any costs or expenses incurred with respect to such enforcement and related defense or (ii) Infinity or its Affiliates are required to pay to the relevant Third Party or any of its Affiliates or sublicensees pursuant to the relevant Qualifying Transaction agreement; (d) payment on behalf of Infinity, or reimbursement to Infinity, of payments due under Existing Infinity Third Party Agreements; (e) payments for the purchase of equity securities of Infinity or any of its Affiliates (including conditional equity, such as warrants, convertible debt and the like), up to the fair market value of such equity on the date of such purchase; and (f) proceeds to Infinity or any of its Affiliates in a debt transaction. Qualifying Transaction Revenues not in cash or cash equivalents shall be due either in kind or in cash, valued at the fair market value thereof on the date received from the Third Party in the Qualifying Transaction.
|
1.4
|
“
Existing Infinity Third Party Agreements
” means each Termination and Revised Relationship Agreement, entered into as of July 17, 2012, by and between Infinity
|
1.5
|
All terms used, but not defined, in this Amendment No. 2 shall have the meaning set forth in the Agreement.
|
2.
|
Effective upon Infinity’s execution of the first Qualifying Transaction, the Agreement is hereby amended as follows:
|
2.1
|
Intellikine Payments
. Infinity shall pay to Intellikine fifty percent (50%) of all Qualifying Transaction Revenue, which will be payable, in each case, within sixty (60) days following Infinity’s (or any of its Affiliate’s) receipt of Qualifying Transaction Revenue.
|
2.2
|
Infinity Milestones
. The Milestone Events listed in Column C of the table contained in Exhibit 3 of the Agreement shall be deemed satisfied upon Infinity’s execution of the first Qualifying Transaction as if they had been achieved by the IPI-145 Product, and any obligation for Infinity to report on any Milestone Event, or pay any Milestone Payment, listed in Column C of the table contained in Exhibit 3 of the Agreement shall be terminated upon Infinity’s execution of the first Qualifying Transaction.
|
2.3
|
Infinity Development
. The introductory paragraph of Section 5.6 of the Agreement is revised to read: “Subject to the terms and conditions of this Agreement, Infinity (itself or through the Infinity Related Parties), will use Diligent Efforts to develop one (1) Product. Infinity’s Diligent Efforts to develop a Product will include demonstration that it and Infinity Related Parties, collectively, have made at least the minimum expenditures each year for the relevant period specified below (pro rated for partial years within each relevant period) on activities with respect to one (1) Product, except that such minimum expenditures requirement shall be suspended until thirty (30) days after the start of the first cGLP toxicology study for such Product:”
|
2.4
|
Infinity Diligence
. Section 6.2 of the Agreement is revised to read: “Infinity shall itself or through the Infinity Related Parties, at its sole cost use Diligent Efforts to (a) prepare, file, prosecute and maintain all applications for Marketing Authorization for the marketing, use, promotion, import, sale, distribution or commercialization of one (1) Product in the Field in the Territory and (b) commercialize such Products which receive Marketing Authorization in the Field in the Territory.”
|
2.5
|
A new clause (c) is added to Section 14.2 of the Agreement to read:
|
3.
|
Press Release
. In the event that either Party wishes to issue a press release or other public statement relating to the terms and conditions of this Amendment No. 2, it shall comply with the obligations set forth in Section 13.2 of the Agreement with respect thereto.
|
4.
|
Confidentiality
.
|
4.1
|
Any Confidential Information (as defined in the Confidential Disclosure Agreement, made as of September 7, 2016, between Infinity and Millennium Pharmaceuticals, Inc. d/b/a Takeda Pharmaceuticals International Co. (“
MPI
”), an Affiliate of Intellikine, (the “
MPI CDA
”)) shall be considered Confidential Information of Infinity under the Agreement.
|
4.2
|
MPI hereby represents and warrants to Infinity that it has the authority to terminate the MPI CDA in accordance with this Amendment No. 2 and to bind Affiliates (as defined in the MPI CDA) of MPI to the provisions of the Agreement with respect to the Confidential Information (as defined in the MPI CDA).
|
5.
|
Entire Agreement/Amendments
. Except as amended by this Amendment No. 2, the Agreement shall remain in full force and effect. After the Amendment 2 Effective Date, every reference in the Agreement to the “Agreement” shall mean the Agreement as amended by this Amendment No. 2. The MPI CDA is hereby terminated in its entirety.
|
6.
|
Counterparts
. This Amendment No. 2 may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Signatures provided by facsimile transmission or in Adobe
TM
Portable Document Format (PDF) sent by electronic mail shall be deemed to be original signatures.
|
SIGNED for and on behalf of
|
)
|
/s/Christophe Bianchi
|
INTELLIKINE LLC
and, solely for
|
)
|
Christophe Bianchi
|
purposes of Section 4 and the last sentence of Section 5,
MILLENNIUM
|
)
|
President of Intellikine LLC and Millennium Pharmaceuticals, Inc.
|
|
|
|
|
|
|
SIGNED for and on behalf of
|
)
|
/s/Adelene Q. Perkins
|
INFINITY PHARMACEUTICALS, INC.
|
)
|
Adelene Q. Perkins
|
|
)
|
President and Chief Executive Officer
|
Date: November 9, 2016
|
|
/s/Adelene Q. Perkins
|
|
|
Adelene Q. Perkins
President and Chief Executive Officer
(Principal Executive Officer)
|
Date: November 9, 2016
|
|
/s/Lawrence E. Bloch, M.D., J.D.
|
|
|
Lawrence E. Bloch, M.D., J.D.
|
|
|
Executive Vice President, Chief Financial Officer and Chief Business Officer
|
|
|
(Principal Financial Officer & Principal Accounting Officer)
|
Date: November 9, 2016
|
|
/s/Adelene Q. Perkins
|
|
|
Adelene Q. Perkins
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
Date: November 9, 2016
|
|
/s/Lawrence E. Bloch, M.D., J.D.
|
|
|
Lawrence E. Bloch, M.D., J.D.
|
|
|
Executive Vice President, Chief Financial Officer and Chief Business Officer
|
|
|
(Principal Financial Officer & Principal Accounting Officer)
|