x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF SECURITIES EXCHANGE ACT OF 1934 |
Delaware
|
|
33-0336973
|
(State or other jurisdiction of incorporation or organization)
|
|
(IRS Employer Identification No.)
|
Large accelerated filer
x
|
Accelerated filer
o
|
|
|
Non-accelerated filer
o
|
Smaller reporting company
o
|
(Do not check if a smaller reporting company)
|
|
PART I
|
FINANCIAL INFORMATION
|
|
|
|
|
ITEM 1:
|
Financial Statements:
|
|
|
|
|
|
3
|
|
|
|
|
|
4
|
|
|
|
|
|
5
|
|
|
|
|
|
6
|
|
|
|
|
|
7
|
|
|
|
|
ITEM 2:
|
18
|
|
|
|
|
|
20
|
|
|
|
|
|
22
|
|
|
|
|
|
23
|
|
|
|
|
ITEM 3:
|
29
|
|
|
|
|
ITEM 4:
|
29
|
|
|
|
|
PART II
|
29
|
|
|
|
|
ITEM 1:
|
29
|
|
|
|
|
ITEM 2:
|
29
|
|
|
|
|
ITEM 3:
|
29
|
|
|
|
|
ITEM 4:
|
29
|
|
|
|
|
ITEM 5:
|
29
|
|
|
|
|
ITEM 6:
|
30
|
|
|
|
|
31
|
|
June 30,
2014
|
December 31,
2013
|
||||||
|
(Unaudited)
|
|
||||||
ASSETS
|
|
|
||||||
Current assets:
|
|
|
||||||
Cash and cash equivalents
|
$
|
94,081
|
$
|
159,973
|
||||
Short-term investments
|
496,754
|
496,788
|
||||||
Contracts receivable
|
41,941
|
11,102
|
||||||
Inventories
|
7,776
|
8,033
|
||||||
Investment in Regulus Therapeutics Inc.
|
56,678
|
52,096
|
||||||
Other current assets
|
8,567
|
7,518
|
||||||
Total current assets
|
705,797
|
735,510
|
||||||
Property, plant and equipment, net
|
86,321
|
86,198
|
||||||
Licenses, net
|
3,631
|
4,572
|
||||||
Patents, net
|
16,729
|
15,517
|
||||||
Deposits and other assets
|
5,299
|
5,359
|
||||||
Total assets
|
$
|
817,777
|
$
|
847,156
|
||||
|
||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
13,453
|
$
|
11,009
|
||||
Accrued compensation
|
6,430
|
12,168
|
||||||
Accrued liabilities
|
25,166
|
22,092
|
||||||
Current portion of long-term obligations
|
4,207
|
4,408
|
||||||
Current portion of deferred contract revenue
|
51,560
|
48,135
|
||||||
Total current liabilities
|
100,816
|
97,812
|
||||||
Long-term deferred contract revenue
|
120,387
|
142,790
|
||||||
2
3
/
4
percent co
nvertible senior notes
|
153,700
|
150,334
|
||||||
Long-term obligations, less current portion
|
4,510
|
6,542
|
||||||
Long-term financing liability for leased facility
|
71,504
|
71,288
|
||||||
Total liabilities
|
450,917
|
468,766
|
||||||
Stockholders' equity:
|
||||||||
Common stock, $0.001 par value; 300,000,000 shares authorized, 117,669,618 and 116,471,371 shares issued and outstanding at June 30, 2014 and December 31, 2013, respectively
|
118
|
116
|
||||||
Additional paid-in capital
|
1,352,994
|
1,324,804
|
||||||
Accumulated other comprehensive income
|
24,719
|
21,080
|
||||||
Accumulated deficit
|
(1,010,971
|
)
|
(967,610
|
)
|
||||
Total stockholders' equity
|
366,860
|
378,390
|
||||||
Total liabilities and stockholders' equity
|
$
|
817,777
|
$
|
847,156
|
|
Three Months Ended
June 30
,
|
Six Months Ended
June 30
,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Revenue:
|
|
|
|
|
||||||||||||
Research and development revenue under collaborative agreements
|
$
|
56,628
|
$
|
37,615
|
$
|
76,177
|
$
|
79,285
|
||||||||
Licensing and royalty revenue
|
448
|
477
|
9,060
|
2,166
|
||||||||||||
Total revenue
|
57,076
|
38,092
|
85,237
|
81,451
|
||||||||||||
|
||||||||||||||||
Expenses:
|
||||||||||||||||
Research, development and patent expenses
|
59,264
|
42,631
|
112,712
|
80,944
|
||||||||||||
General and administrative
|
4,462
|
3,389
|
8,842
|
6,811
|
||||||||||||
Total operating expenses
|
63,726
|
46,020
|
121,554
|
87,755
|
||||||||||||
|
||||||||||||||||
Loss from operations
|
(6,650
|
)
|
(7,928
|
)
|
(36,317
|
)
|
(6,304
|
)
|
||||||||
|
||||||||||||||||
Other income (expense):
|
||||||||||||||||
Investment income
|
671
|
589
|
1,328
|
967
|
||||||||||||
Interest expense
|
(4,961
|
)
|
(4,808
|
)
|
(9,904
|
)
|
(9,603
|
)
|
||||||||
(Loss) gain on investments, net
|
(260
|
)
|
840
|
137
|
1,898
|
|||||||||||
|
||||||||||||||||
Loss before income tax expense
|
(11,200
|
)
|
(11,307
|
)
|
(44,756
|
)
|
(13,042
|
)
|
||||||||
|
||||||||||||||||
Income tax (expense) benefit
|
(881
|
)
|
1,181
|
1,395
|
1,244
|
|||||||||||
|
||||||||||||||||
Net loss
|
$
|
(12,081
|
)
|
$
|
(10,126
|
)
|
$
|
(43,361
|
)
|
$
|
(11,798
|
)
|
||||
|
||||||||||||||||
Basic and diluted net loss per share
|
$
|
(0.10
|
)
|
$
|
(0.09
|
)
|
$
|
(0.37
|
)
|
$
|
(0.11
|
)
|
||||
Shares used in computing basic and diluted net loss per share
|
117,588
|
108,539
|
117,359
|
105,225
|
|
Three Months Ended
June 30
,
|
Six Months Ended
June 30
,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
|
|
|
|
|
||||||||||||
Net loss
|
$
|
(12,081
|
)
|
$
|
(10,126
|
)
|
$
|
(43,361
|
)
|
$
|
(11,798
|
)
|
||||
Unrealized (losses) gains on securities, net of tax
|
(4,456
|
)
|
9,202
|
3,806
|
15,669
|
|||||||||||
Reclassification adjustment for realized losses (gains) included in net loss
|
175
|
—
|
(167
|
)
|
(1,163
|
)
|
||||||||||
|
||||||||||||||||
Comprehensive (loss) income
|
$
|
(16,362
|
)
|
$
|
(924
|
)
|
$
|
(39,722
|
)
|
$
|
2,708
|
|
Six Months Ended
June 30
,
|
|||||||
|
2014
|
2013
|
||||||
Operating activities:
|
|
|
||||||
Net loss
|
$
|
(43,361
|
)
|
$
|
(11,798
|
)
|
||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
||||||||
Depreciation
|
3,141
|
3,375
|
||||||
Amortization of patents
|
543
|
584
|
||||||
Amortization of licenses
|
941
|
1,051
|
||||||
Amortization of premium on investments, net
|
3,847
|
2,382
|
||||||
Amortization of debt issuance costs
|
272
|
202
|
||||||
Amortization of
2
3
¤
4
percent convertible senior notes discount
|
3,366
|
3,109
|
||||||
Amortization of long-term financing liability for leased facility
|
3,306
|
3,276
|
||||||
Stock-based compensation expense
|
14,776
|
5,505
|
||||||
Gain on investments, net
|
(137
|
)
|
(1,898
|
)
|
||||
Non-cash losses related to patents, licensing and property, plant and equipment
|
325
|
263
|
||||||
Tax benefit from other unrealized gains on securities
|
(1,395
|
)
|
-
|
|||||
Changes in operating assets and liabilities:
|
||||||||
Contracts receivable
|
(30,839
|
)
|
(1,502
|
)
|
||||
Inventories
|
257
|
(2,188
|
)
|
|||||
Other current and long-term assets
|
(694
|
)
|
(492
|
)
|
||||
Accounts payable
|
1,991
|
(1,833
|
)
|
|||||
Accrued compensation
|
(5,738
|
)
|
(847
|
)
|
||||
Deferred rent
|
69
|
98
|
||||||
Accrued liabilities
|
1,965
|
(135
|
)
|
|||||
Deferred contract revenue
|
(18,978
|
)
|
13,012
|
|||||
Net cash (used in) provided by operating activities
|
(66,343
|
)
|
12,164
|
|||||
|
||||||||
Investing activities:
|
||||||||
Purchases of short-term investments
|
(179,196
|
)
|
(144,250
|
)
|
||||
Proceeds from the sale of short-term investments
|
175,777
|
96,926
|
||||||
Purchases of property, plant and equipment
|
(3,100
|
)
|
(591
|
)
|
||||
Acquisition of licenses and other assets, net
|
(1,791
|
)
|
(1,171
|
)
|
||||
Proceeds from the sale of strategic investments
|
737
|
1,938
|
||||||
Net cash used in investing activities
|
(7,573
|
)
|
(47,148
|
)
|
||||
|
||||||||
Financing activities:
|
||||||||
Proceeds from equity awards
|
13,416
|
36,879
|
||||||
Net proceeds from public common stock offering
|
-
|
173,223
|
||||||
Proceeds from equipment financing arrangement
|
-
|
2,513
|
||||||
Principal payments on debt and capital lease obligations
|
(5,392
|
)
|
(5,573
|
)
|
||||
Net cash provided by financing activities
|
8,024
|
207,042
|
||||||
|
||||||||
Net (decrease) increase in cash and cash equivalents
|
(65,892
|
)
|
172,058
|
|||||
Cash and cash equivalents at beginning of period
|
159,973
|
124,482
|
||||||
Cash and cash equivalents at end of period
|
$
|
94,081
|
$
|
296,540
|
||||
|
||||||||
Supplemental disclosures of cash flow information:
|
||||||||
Interest paid
|
$
|
2,920
|
$
|
2,977
|
||||
Income taxes paid
|
$
|
-
|
$
|
2
|
||||
|
||||||||
Supplemental disclosures of non-cash investing and financing activities:
|
||||||||
Amounts accrued for capital and patent expenditures
|
$
|
453
|
$
|
1,055
|
1. | Basis of Presentation |
2. | Significant Accounting Policies |
● | The exclusive license we granted to AstraZeneca to develop and commercialize ISIS-STAT3 Rx for the treatment of cancer; |
● | The development services we are performing for ISIS-STAT3 Rx ; |
● | The exclusive license we granted to AstraZeneca to develop and commercialize ISIS-AR Rx and the research services we performed for ISIS-AR Rx ; and |
● | The option to license up to three drugs under a research program and the research services we will perform for this program. |
● | Estimated future product sales; |
● | Estimated royalties on future product sales; |
● | Contractual milestone payments; |
● | Expenses we expect to incur; |
● | Income taxes; and |
● | An appropriate discount rate. |
● | The number of internal hours we will spend performing these services; |
● | The estimated number and cost of studies we will perform; |
● | The estimated number and cost of studies that we will contract with third parties to perform; and |
● | The estimated cost of drug product we will use in the studies. |
● | In January 2012, we entered into a collaboration agreement with Biogen Idec to develop and commercialize ISIS-SMN Rx for SMA. As part of the collaboration, we received a $29 million upfront payment and we are responsible for global development of ISIS-SMN Rx through completion of Phase 2/3 clinical trials. |
● | In June 2012, we entered into a second and separate collaboration agreement with Biogen Idec to develop and commercialize a novel antisense drug targeting DMPK, or dystrophia myotonica-protein kinase. As part of the collaboration, we received a $12 million upfront payment and we are responsible for global development of the drug through the completion of a Phase 2 clinical trial. |
● | In December 2012, we entered into a third and separate collaboration agreement with Biogen Idec to discover and develop antisense drugs against three targets to treat neurological or neuromuscular disorders. As part of the collaboration, we received a $30 million upfront payment and we are responsible for the discovery of a lead antisense drug for each of three targets. |
● | In September 2013, we entered into a fourth and separate collaboration agreement with Biogen Idec to leverage antisense technology to advance the treatment of neurological diseases. We granted Biogen Idec exclusive rights to the use of our antisense technology to develop therapies for neurological diseases as part of this broad collaboration. We received a $100 million upfront payment and we are responsible for discovery and early development through the completion of a Phase 2 clinical trial for each antisense drug identified during the six year term of this collaboration, while Biogen Idec is responsible for the creation and development of small molecule treatments and biologics. |
● | Designation of a development candidate. Following the designation of a development candidate, IND-enabling animal studies for a new development candidate generally take 12 to 18 months to complete; |
● | Initiation of a Phase 1 clinical trial. Generally, Phase 1 clinical trials take one to two years to complete; |
● | Initiation or completion of a Phase 2 clinical trial. Generally, Phase 2 clinical trials take one to three years to complete; |
● | Initiation or completion of a Phase 3 clinical trial. Generally, Phase 3 clinical trials take two to four years to complete. |
● | Filing of regulatory applications for marketing approval such as a New Drug Application, or NDA, in the United States or a Marketing Authorization Application, or MAA, in Europe. Generally, it takes six to twelve months to prepare and submit regulatory filings. |
● | Marketing approval in a major market, such as the United States, Europe or Japan. Generally it takes one to two years after an application is submitted to obtain approval from the applicable regulatory agency. |
● | First commercial sale in a particular market, such as in the United States or Europe. |
● | Product sales in excess of a pre-specified threshold, such as annual sales exceeding $1 billion. The amount of time to achieve this type of milestone depends on several factors including but not limited to the dollar amount of the threshold, the pricing of the product and the pace at which customers begin using the product. |
● | Substantive uncertainty exists as to the achievement of the milestone event at the inception of the arrangement; |
● | The achievement of the milestone involves substantive effort and can only be achieved based in whole or in part on our performance or the occurrence of a specific outcome resulting from our performance; |
● | The amount of the milestone payment appears reasonable either in relation to the effort expended or to the enhancement of the value of the delivered items; |
● | There is no future performance required to earn the milestone; and |
● | The consideration is reasonable relative to all deliverables and payment terms in the arrangement. |
● | 2¾ percent convertible senior notes; |
● | Dilutive stock options; and |
● | Restricted stock units. |
|
Three Months Ended
June 30
,
|
Six Months Ended
June 30
,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Beginning balance accumulated other comprehensive income
|
$
|
29,000
|
$
|
17,784
|
$
|
21,080
|
$
|
12,480
|
||||||||
Unrealized (losses) gains on securities, net of tax (1)
|
(4,456
|
)
|
9,202
|
3,806
|
15,669
|
|||||||||||
Amounts reclassified from accumulated other comprehensive income (2)
|
175
|
-
|
(167
|
)
|
(1,163
|
)
|
||||||||||
Net current period other comprehensive income (loss)
|
(4,281
|
)
|
9,202
|
3,639
|
14,506
|
|||||||||||
Ending balance accumulated other comprehensive income
|
$
|
24,719
|
$
|
26,986
|
$
|
24,719
|
$
|
26,986
|
(1) | Other comprehensive income for the three and six months ended June 30, 2014 includes income tax benefit of $2.9 million and income tax expense of $2.5 million, respectively, compared to an income tax benefit of $2.9 million and $10.0 million for same periods in 2013. |
(2) | Included in gain (loss) on investments, net on our condensed consolidated statement of operations. |
|
Six Months Ended
June 30
,
|
|||||||
|
2014
|
2013
|
||||||
Risk-free interest rate
|
1.6
|
%
|
1.0
|
%
|
||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
||||
Volatility
|
50.6
|
%
|
51.5
|
%
|
||||
Expected life
|
4.6 years
|
5.1 years
|
|
Six Months Ended
June 30
,
|
|||||||
|
2014
|
2013
|
||||||
Risk-free interest rate
|
0.1
|
%
|
0.1
|
%
|
||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
||||
Volatility
|
59.0
|
%
|
61.4
|
%
|
||||
Expected life
|
6 months
|
6 months
|
|
Six Months Ended
June 30
,
|
|||||||
|
2014
|
2013
|
||||||
Risk-free interest rate
|
2.3
|
%
|
2.3
|
%
|
||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
||||
Volatility
|
53.3
|
%
|
52.4
|
%
|
||||
Expected life
|
7.1 years
|
7.3 years
|
|
Three Months Ended
June 30
,
|
Six Months Ended
June 30
,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Research, development and patent expenses
|
$
|
6,401
|
$
|
2,252
|
$
|
12,274
|
$
|
4,798
|
||||||||
General and administrative
|
1,307
|
384
|
2,503
|
707
|
||||||||||||
Total
|
$
|
7,708
|
$
|
2,636
|
$
|
14,777
|
$
|
5,505
|
3. | Investments |
One year or less
|
53
|
%
|
||
After one year but within two years
|
36
|
%
|
||
After two years but within three years
|
11
|
%
|
||
Total
|
100
|
%
|
|
Amortized
|
Unrealized
|
Other-
Than-
Temporary
Impairment
|
Estimated
|
||||||||||||||||
June 30, 2014
|
Cost
|
Gains
|
Losses
|
Loss
|
Fair Value
|
|||||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|||||||||||||||
Corporate debt securities(1)
|
$
|
166,635
|
$
|
115
|
$
|
(39
|
)
|
$
|
—
|
$
|
166,711
|
|||||||||
Debt securities issued by U.S. government agencies (1)
|
61,421
|
14
|
(38
|
)
|
—
|
61,397
|
||||||||||||||
Debt securities issued by the U.S. Treasury
|
9,245
|
17
|
—
|
—
|
9,262
|
|||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states
|
43,527
|
17
|
(42
|
)
|
—
|
43,502
|
||||||||||||||
Total securities with a maturity of one year or less
|
280,828
|
163
|
(119
|
)
|
—
|
280,872
|
||||||||||||||
Corporate debt securities
|
173,089
|
186
|
(139
|
)
|
—
|
173,136
|
||||||||||||||
Debt securities issued by U.S. government agencies
|
37,048
|
4
|
(76
|
)
|
—
|
36,976
|
||||||||||||||
Debt securities issued by the U.S. Treasury
|
1,997
|
5
|
—
|
—
|
2,002
|
|||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states
|
22,861
|
68
|
(40
|
)
|
—
|
22,889
|
||||||||||||||
Total securities with a maturity of more than one year
|
234,995
|
263
|
(255
|
)
|
—
|
235,003
|
||||||||||||||
Total available-for-sale securities
|
$
|
515,823
|
$
|
426
|
$
|
(374
|
)
|
$
|
—
|
$
|
515,875
|
|
Cost
|
Unrealized
|
Other-
Than-
Temporary
Impairment
|
Estimated
|
||||||||||||||||
June 30, 2014
|
Basis
|
Gains
|
Losses
|
Loss
|
Fair Value
|
|||||||||||||||
Equity securities:
|
|
|
|
|
|
|||||||||||||||
Regulus Therapeutics Inc.
|
$
|
15,526
|
$
|
41,152
|
$
|
—
|
$
|
—
|
$
|
56,678
|
||||||||||
Securities included in other current assets
|
1,269
|
1,856
|
—
|
(1,269
|
)
|
1,856
|
||||||||||||||
Securities included in deposits and other assets
|
625
|
—
|
—
|
—
|
625
|
|||||||||||||||
Total equity securities
|
$
|
17,420
|
$
|
43,008
|
$
|
—
|
$
|
(1,269
|
)
|
$
|
59,159
|
|||||||||
Total available-for-sale and equity securities
|
$
|
533,243
|
$
|
43,434
|
$
|
(374
|
)
|
$
|
(1,269
|
)
|
$
|
575,034
|
|
Amortized
|
Unrealized
|
Other-
Than-
Temporary
Impairment
|
Estimated
|
||||||||||||||||
December 31, 2013
|
Cost
|
Gains
|
Losses
|
Loss
|
Fair Value
|
|||||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|||||||||||||||
Corporate debt securities(1)
|
$
|
142,096
|
$
|
75
|
$
|
(27
|
)
|
$
|
—
|
$
|
142,144
|
|||||||||
Debt securities issued by U.S. government agencies (1)
|
23,242
|
22
|
(16
|
)
|
—
|
23,248
|
||||||||||||||
Debt securities issued by the U.S. Treasury
|
6,239
|
6
|
—
|
—
|
6,245
|
|||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states
|
8,082
|
6
|
(28
|
)
|
—
|
8,060
|
||||||||||||||
Total securities with a maturity of one year or less
|
179,659
|
109
|
(71
|
)
|
—
|
179,697
|
||||||||||||||
Corporate debt securities
|
265,969
|
177
|
(393
|
)
|
—
|
265,753
|
||||||||||||||
Debt securities issued by U.S. government agencies
|
41,308
|
3
|
(127
|
)
|
—
|
41,184
|
||||||||||||||
Debt securities issued by the U.S. Treasury
|
9,062
|
21
|
—
|
—
|
9,083
|
|||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states
|
14,186
|
37
|
(28
|
)
|
—
|
14,195
|
||||||||||||||
Total securities with a maturity of more than one year
|
330,525
|
238
|
(548
|
)
|
—
|
330,215
|
||||||||||||||
Total available-for-sale securities
|
$
|
510,184
|
$
|
347
|
$
|
(619
|
)
|
$
|
—
|
$
|
509,912
|
|
Cost
|
Unrealized
|
Other-
Than-
Temporary
Impairment
|
Estimated
|
||||||||||||||||
December 31, 2013
|
Basis
|
Gains
|
Losses
|
Loss
|
Fair Value
|
|||||||||||||||
Equity securities:
|
|
|
|
|
|
|||||||||||||||
Regulus Therapeutics Inc.
|
$
|
15,526
|
$
|
36,570
|
$
|
—
|
$
|
—
|
$
|
52,096
|
||||||||||
Securities included in other current assets
|
1,538
|
618
|
—
|
(880
|
)
|
1,276
|
||||||||||||||
Securities included in deposits and other assets
|
625
|
—
|
—
|
—
|
625
|
|||||||||||||||
Total equity securities
|
$
|
17,689
|
$
|
37,188
|
$
|
—
|
$
|
(880
|
)
|
$
|
53,997
|
|||||||||
Total available-for-sale and equity securities
|
$
|
527,873
|
$
|
37,535
|
$
|
(619
|
)
|
$
|
(880
|
)
|
$
|
563,909
|
(1) | Includes investments classified as cash equivalents on our condensed consolidated balance sheet. |
|
|
Less than 12 months of
temporary impairment
|
More than 12 months of
temporary impairment
|
Total temporary
impairment
|
||||||||||||||||||||||||
|
Number of
Investments
|
Estimated
Fair Value
|
Unrealized
Losses
|
Estimated
Fair Value
|
Unrealized
Losses
|
Estimated
Fair Value
|
Unrealized
Losses
|
|||||||||||||||||||||
Corporate debt securities
|
135
|
$
|
130,498
|
$
|
(167
|
)
|
$
|
8,342
|
$
|
(11
|
)
|
$
|
138,840
|
$
|
(178
|
)
|
||||||||||||
Debt securities issued by U.S. government agencies
|
12
|
65,917
|
(114
|
)
|
-
|
-
|
65,917
|
(114
|
)
|
|||||||||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states
|
12
|
9,800
|
(82
|
)
|
-
|
-
|
9,800
|
(82
|
)
|
|||||||||||||||||||
Total temporarily impaired securities
|
159
|
$
|
206,215
|
$
|
(363
|
)
|
$
|
8,342
|
$
|
(11
|
)
|
$
|
214,557
|
$
|
(374
|
)
|
4. | Fair Value Measurements |
|
At June 30,
2014
|
Quoted Prices in
Active Markets
(Level 1)
|
Significant Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||||||
Cash equivalents
|
$
|
70,638
|
$
|
70,638
|
$
|
—
|
$
|
—
|
||||||||
Corporate debt securities (1)
|
339,847
|
—
|
339,847
|
—
|
||||||||||||
Debt securities issued by U.S. government agencies (1)
|
98,373
|
—
|
98,373
|
—
|
||||||||||||
Debt securities issued by the U.S. Treasury
|
11,264
|
11,264
|
—
|
—
|
||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states (1)
|
66,391
|
—
|
66,391
|
—
|
||||||||||||
Investment in Regulus Therapeutics Inc.
|
56,678
|
56,678
|
—
|
—
|
||||||||||||
Equity securities (2)
|
2,481
|
625
|
—
|
1,856
|
||||||||||||
Total
|
$
|
645,672
|
$
|
139,205
|
$
|
504,611
|
$
|
1,856
|
|
At December 31,
2013
|
Quoted Prices in
Active Markets
(Level 1)
|
Significant Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||||||
Cash equivalents
|
$
|
133,233
|
$
|
133,233
|
$
|
—
|
$
|
—
|
||||||||
Corporate debt securities (1)
|
407,897
|
—
|
407,897
|
—
|
||||||||||||
Debt securities issued by U.S. government agencies
|
64,432
|
—
|
64,432
|
—
|
||||||||||||
Debt securities issued by the U.S. Treasury
|
15,328
|
15,328
|
—
|
—
|
||||||||||||
Debt securities issued by states of the United States and political subdivisions of the states
|
22,255
|
—
|
22,255
|
—
|
||||||||||||
Investment in Regulus Therapeutics Inc.
|
52,096
|
52,096
|
—
|
—
|
||||||||||||
Equity securities (2)
|
1,276
|
1,276
|
—
|
—
|
||||||||||||
Total
|
$
|
696,517
|
$
|
201,933
|
$
|
494,584
|
$
|
—
|
(1) | Includes investments classified as cash equivalents on our condensed consolidated balance sheet. |
(2) | Included in other current assets on our condensed consolidated balance sheet. |
|
|
|||
Beginning balance of Level 3 investments
|
$
|
-
|
||
Total gain included in accumulated other comprehensive income (loss)
|
1,856
|
|||
Ending balance of Level 3 investments
|
$
|
1,856
|
|
Three Months Ended
June 30
,
|
Six Months Ended
June 30
,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Partner A
|
60
|
%
|
19
|
%
|
52
|
%
|
14
|
%
|
||||||||
Partner B
|
27
|
%
|
40
|
%
|
22
|
%
|
22
|
%
|
||||||||
Partner C
|
0
|
%
|
20
|
%
|
0
|
%
|
40
|
%
|
||||||||
Partner D
|
6
|
%
|
6
|
%
|
8
|
%
|
15
|
%
|
6. | Income Taxes |
7. | Collaborative Arrangements and Licensing Agreements |
● | $11.2 million related to the ISIS-AR Rx program, which we amortized through March 2014; |
● | $7.6 million related to the option to license three drugs under a separate research program, which we are amortizing through December 2016; and |
● | $0.7 million related to the ISIS-STAT3 Rx program, which we are amortizing through November 2014. |
● | AstraZeneca may terminate the agreement or any program at any time by providing written notice to us; |
● | AstraZeneca may terminate the agreement or any program by providing written notice if we undergo a change of control with a third party; and |
● | Either we or AstraZeneca may terminate the agreement or any program by providing written notice to the other party upon the other party’s uncured failure to perform a material obligation under the agreement, or the entire agreement if the other party becomes insolvent. |
● | $3.8 million related to the Phase 2 studies in children and infants with SMA, which we are amortizing through July 2014; and |
● | $5.5 million related to an open-label extension study in children with SMA, which we are amortizing through December 2014. |
● | Biogen Idec may terminate the agreement or any program at any time by providing written notice to us; |
● | Under specific circumstances, if we are acquired by a third party with a product that directly competes with a compound being developed under the agreement, Biogen Idec may terminate the affected program by providing written notice to us; |
● | If, within a specified period of time, any required clearance of a transaction contemplated by an agreement under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, is not received, then either we or Biogen Idec may terminate the affected program by providing written notice to the other party; and |
● | Either we or Biogen Idec may terminate any program by providing written notice to the other party upon the other party’s uncured failure to perform a material obligation under the agreement with respect to the affected program, or the entire agreement if the other party becomes insolvent. |
● | GSK may terminate any program other than the ISIS-TTR Rx program at any time by providing written notice to us; |
● | GSK may terminate the ISIS-TTR Rx program by providing written notice to us after reviewing specific data from the Phase 3 study for the program; and |
● | Either we or GSK may terminate any program by providing written notice to the other party upon the other party’s uncured failure to perform a material obligation under the agreement with respect to the affected program, or the entire agreement if the other party becomes insolvent. |
● | Roche may terminate the agreement at any time by providing written notice to us; |
● | Either we or Roche may terminate the agreement by providing written notice to the other party upon the other party’s uncured failure to perform a material obligation under the agreement or if the other party becomes insolvent; and |
● | Either we or Roche may terminate the brain shuttle program if at least one development candidate is not designated under such program by a mutually agreed deadline. |
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
●
|
We reported positive clinical results from five drugs in later-stage development. These data exemplify the broad applicability and potential for antisense drugs to provide therapeutic benefit to many different diseases.
|
o
|
We reported positive Phase 2 data on ISIS-APOCIII
Rx
in patients with high to extremely high triglyceride levels as a single agent and in combination with fibrates. In these studies, patients experienced substantial reductions of triglyceride and apoC-III levels with significant increases in HDL-cholesterol. These Phase 2 data were presented at the Arteriosclerosis, Thrombosis and Vascular Biology and the National Lipid Association meetings.
|
o
|
We presented positive results from both of the ongoing multiple-dose open label Phase 2 studies of ISIS-SMN
Rx
in infants and children with SMA, which were consistent with earlier reported data. In these studies, we reported increases in muscle function scores in infants and children treated with ISIS-SMN
Rx
. These Phase 2 data were presented at the American Academy of Neurology meeting.
|
o
|
We reported positive Phase 2 data for ISIS-GCGR
Rx
in patients with type 2 diabetes. In this study, patients with type 2 diabetes uncontrolled on stable metformin therapy experienced up to a 2.25 percentage point mean reduction in hemoglobin A1c levels after 13 weeks of dosing. These Phase 2 data were presented at the American Diabetes Association Scientific Sessions.
|
o
|
We reported positive top-line Phase 2 clinical results for ISIS-FXI
Rx
in patients undergoing total knee replacement. In this study, ISIS-FXI
Rx
-treated patients experienced a dose-dependent decrease in venous thromboembolism and numerically fewer bleeding events compared to patients treated with enoxaparin.
|
o
|
We reported Phase 2 results showing that ISIS-CRP
Rx
produced statistically significant mean reductions of C-reactive protein, or CRP, protein of 65 % with reductions as great as 84% in patients with atrial fibrillation, or AF. In addition, two patients who had elevated levels of CRP (>5 mg/L) experienced a reduction of CRP that was associated with a decline to zero in overall AF burden while on treatment.
|
●
|
We continued to advance our pipeline of drugs.
|
o
|
We initiated a Phase 3 study, ENDEAR, of ISIS-SMN
Rx
in infants with SMA and will earn an $18 million milestone payment upon dosing of the first infant. This is the first of several planned studies in a broad and comprehensive late-stage clinical development program for ISIS-SMN
Rx
.
|
o
|
We initiated a Phase 2 study of ISIS-APO(a)
Rx
in patients with high levels of lipoprotein(a), an independent risk factor for cardiovascular disease.
|
o
|
We initiated a Phase 1 study of ISIS-PKK
Rx
, an antisense drug to treat patients with hereditary angioedemia, and a Phase 1 study of ISIS-DMPK
Rx
, an antisense drug to treat patients with myotonic dystrophy type 1.
|
o
|
AstraZeneca initiated a Phase 1 study of ISIS-AR
Rx
, an antisense drug discovered by us to treat patients with cancer.
|
o
|
We added a new drug, ISIS-HTT
Rx
, to our pipeline. ISIS-HTT
Rx
is part of our alliance with Roche and is in development to treat patients with Huntington's Disease.
|
●
|
We and our partners were recognized by the drug development community for our innovative and collaborative alliances and our commitment to developing drugs to treat patients with serious, unmet medical needs.
|
o
|
We and Genzyme received the 2014 Partners in Progress Corporate Award from the National Organization for Rare Disorders, or NORD, for the development and approval of KYNAMRO, a drug selected for being a very important orphan therapy to reach the market in the United States. This award honors companies that have brought important and innovative treatments to market for patients with rare disorders.
|
o
|
Ours and Biogen Idec's innovative collaboration was voted breakthrough alliance of 2014 by Thomson Reuters Recap.
|
o
|
Frank Bennett, Ph.D., our senior vice president, research, was a recipient of the Commitment to a Cure Award by the ALS Association for his and our research and commitment to develop a treatment for amyotrophic lateral sclerosis, or ALS.
|
● | Assessing the propriety of revenue recognition and associated deferred revenue; |
● | Determining the proper valuation of investments in marketable securities and other equity investments; |
● | Assessing the recoverability of long-lived assets, including property and equipment, intellectual property and licensed technology; |
● | Determining the appropriate cost estimates for unbilled preclinical studies and clinical development activities; |
● | Estimating our net deferred income tax asset valuation allowance; |
● | Determining the fair value of convertible debt without the conversion feature; |
●
|
$24.5 million from Biogen Idec related to advancing ISIS-SMN
Rx
, initiating a Phase 1 study for ISIS-DMPK
Rx
, and validating an undisclosed target to treat a neurological disorder;
|
●
|
$15 million from AstraZeneca related to initiating a Phase 1 clinical study of ISIS-AR
Rx
; and
|
●
|
$2 million from GSK related to advancing ISIS-TTR
Rx
.
|
|
Three Months Ended
June 30
,
|
Six Months Ended
June 30
,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Research, development and patent expenses
|
$
|
52,863
|
$
|
40,379
|
$
|
100,438
|
$
|
76,146
|
||||||||
Non-cash compensation expense related to equity awards
|
6,401
|
2,252
|
12,274
|
4,798
|
||||||||||||
Total research, development and patent expenses
|
$
|
59,264
|
$
|
42,631
|
$
|
112,712
|
$
|
80,944
|
|
Three Months Ended
June 30
,
|
Six Months Ended
June 30
,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Antisense drug discovery expenses
|
$
|
10,759
|
$
|
10,854
|
$
|
19,855
|
$
|
20,251
|
||||||||
Non-cash compensation expense related to equity awards
|
1,844
|
682
|
3,530
|
1,451
|
||||||||||||
Total antisense drug discovery
|
$
|
12,603
|
$
|
11,536
|
$
|
23,385
|
$
|
21,702
|
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
KYNAMRO
|
$
|
637
|
$
|
1,647
|
$
|
2,464
|
$
|
3,591
|
||||||||
ISIS-TTR
Rx
|
2,321
|
1,218
|
5,032
|
1,984
|
||||||||||||
Other antisense development products
|
24,383
|
13,710
|
42,504
|
23,588
|
||||||||||||
Development overhead costs
|
2,803
|
1,743
|
6,543
|
3,561
|
||||||||||||
Non-cash compensation expense related to equity awards
|
2,325
|
721
|
4,402
|
1,576
|
||||||||||||
Total antisense drug development
|
$
|
32,469
|
$
|
19,039
|
$
|
60,945
|
$
|
34,300
|
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Manufacturing and operations
|
$
|
5,226
|
$
|
4,354
|
$
|
10,992
|
$
|
8,575
|
||||||||
Non-cash compensation expense related to equity awards
|
750
|
305
|
1,449
|
659
|
||||||||||||
Total manufacturing and operations
|
$
|
5,976
|
$
|
4,659
|
$
|
12,441
|
$
|
9,234
|
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Personnel costs
|
$
|
2,385
|
$
|
2,318
|
$
|
4,948
|
$
|
4,656
|
||||||||
Occupancy
|
1,819
|
1,688
|
3,554
|
3,334
|
||||||||||||
Patent expenses
|
706
|
1,096
|
1,080
|
3,074
|
||||||||||||
Depreciation and amortization
|
578
|
595
|
1,149
|
595
|
||||||||||||
Insurance
|
300
|
280
|
594
|
567
|
||||||||||||
Other
|
946
|
876
|
1,723
|
876
|
||||||||||||
Non-cash compensation expense related to equity awards
|
1,482
|
544
|
2,893
|
1,112
|
||||||||||||
Total antisense drug development
|
$
|
8,216
|
$
|
7,397
|
$
|
15,941
|
$
|
14,214
|
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
General and administrative expenses
|
$
|
3,155
|
$
|
3,005
|
$
|
6,339
|
$
|
6,104
|
||||||||
Non-cash compensation expense related to equity awards
|
1,307
|
384
|
2,503
|
707
|
||||||||||||
Total general and administrative expenses
|
$
|
4,462
|
$
|
3,389
|
$
|
8,842
|
$
|
6,811
|
|
Payments Due by Period (in millions)
|
|||||||||||||||||||
Contractual Obligations
(selected balances described below)
|
Total
|
Less than
1 year
|
1-3 years
|
3-5 years
|
After
5 years
|
|||||||||||||||
2
¾
percent Convertible Senior Notes (principal and interest payable)
|
$
|
231.7
|
$
|
5.5
|
$
|
11.1
|
$
|
11.1
|
$
|
204.0
|
||||||||||
Facility Rent Payments
|
$
|
134.8
|
$
|
6.2
|
$
|
12.9
|
$
|
13.7
|
$
|
102.0
|
||||||||||
Equipment Financing Arrangements (principal and interest payable)
|
$
|
5.4
|
$
|
4.2
|
$
|
1.2
|
$
|
-
|
$
|
-
|
||||||||||
Other Obligations (principal and interest payable)
|
$
|
1.3
|
$
|
0.1
|
$
|
0.1
|
$
|
0.1
|
$
|
1.0
|
||||||||||
Capital Lease
|
$
|
0.3
|
$
|
0.2
|
$
|
0.1
|
$
|
-
|
$
|
-
|
||||||||||
Operating Leases
|
$
|
25.9
|
$
|
1.5
|
$
|
3.1
|
$
|
2.9
|
$
|
18.4
|
||||||||||
Total
|
$
|
399.4
|
$
|
17.7
|
$
|
28.5
|
$
|
27.8
|
$
|
325.4
|
● | receipt and scope of regulatory approvals; |
● | establishment and demonstration in the medical and patient community of the efficacy and safety of our drugs and their potential advantages over competing products; |
● | cost and effectiveness of our drugs compared to other available therapies; |
● | patient convenience of the dosing regimen for our drugs; and |
● | reimbursement policies of government and third-party payors. |
● | priced lower than our drugs; |
● | safer than our drugs; |
● | more effective than our drugs; or |
● | more convenient to use than our drugs. |
● | KYNAMRO is approved in the United States as an adjunct to lipid-lowering medications and diet to reduce low density lipoprotein-cholesterol, apolipoprotein B, total cholesterol, and non-high density lipoprotein-cholesterol in patients with HoFH; |
● | the KYNAMRO label contains a Boxed Warning citing a risk of hepatic toxicity; and |
● | KYNAMRO is available only through a Risk Evaluation and Mitigation Strategy called the KYNAMRO REMS. |
● | fund some of our development activities for KYNAMRO; |
● | seek and obtain regulatory approvals for KYNAMRO; and |
● | successfully commercialize KYNAMRO. |
● | the clinical study may produce negative or inconclusive results; |
● | regulators may require that we hold, suspend or terminate clinical research for noncompliance with regulatory requirements; |
● | we, our partners, the FDA or foreign regulatory authorities could suspend or terminate a clinical study due to adverse side effects of a drug on subjects in the trial; |
● | we may decide, or regulators may require us, to conduct additional preclinical testing or clinical studies; |
● | enrollment in our clinical studies may be slower than we anticipate; |
● | the cost of our clinical studies may be greater than we anticipate; and |
● | the supply or quality of our drugs or other materials necessary to conduct our clinical studies may be insufficient, inadequate or delayed. |
● | conduct clinical studies; |
● | seek and obtain regulatory approvals; and |
● | manufacture, market and sell our drugs. |
● | pursue alternative technologies or develop alternative products that may be competitive with the drug that is part of the collaboration with us; |
● | pursue higher-priority programs or change the focus of its own development programs; or |
● | choose to devote fewer resources to our drugs than it does for its own drugs. |
● | additional marketing approvals and successful commercial launch of KYNAMRO; |
● | changes in existing collaborative relationships and our ability to establish and maintain additional collaborative arrangements; |
● | continued scientific progress in our research, drug discovery and development programs; |
● | the size of our programs and progress with preclinical and clinical studies; |
● | the time and costs involved in obtaining regulatory approvals; |
● | competing technological and market developments, including the introduction by others of new therapies that address our markets; and |
● | the profile and launch timing of our drugs, including ISIS-APOCIII Rx , ISIS-SMN Rx and ISIS-TTR Rx . |
● | interruption of our research, development and manufacturing efforts; |
● | injury to our employees and others; |
● | environmental damage resulting in costly clean up; and |
● | liabilities under federal, state and local laws and regulations governing health and human safety, as well as the use, storage, handling and disposal of these materials and resultant waste products. |
ITEM 6.
|
a.
|
Exhibits
|
Exhibit
Number
|
|
Description of Document
|
|
Certificate of Amendment to Restated Certificate of Incorporation filed June 17, 2014.
|
|
|
|
|
|
Restated Certificate of Incorporation filed June 19, 1991.
|
|
|
|
|
|
Certificate of Designation of Series C Junior Participating Preferred Stock filed December 13, 2000.
|
|
|
|
|
|
Amendment No. 3 to the Research, Development and License Agreement between the Registrant and Glaxo Group Limited dated July 10, 2013. Portions of this exhibit have been omitted and separately filed with the SEC.
|
|
|
|
|
|
Amendment #4 to the Research, Development and License Agreement between the Registrant and Glaxo Group Limited dated April 10, 2014. Portions of this exhibit have been omitted and separately filed with the SEC.
|
|
|
|
|
|
Amendment #5 to the Research, Development and License Agreement among the Registrant, Glaxo Group Limited and GlaxoSmithKline Intellectual Property Development Limited dated June 27, 2014. Portions of this exhibit have been omitted and separately filed with the SEC.
|
|
|
|
|
|
Certification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
Certification by Chief Financial Offic5er Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
101
|
|
The following financial statements from the Isis Pharmaceuticals, Inc. Quarterly Report on Form 10-Q for the quarter ended
June 30, 2014
, formatted in Extensive Business Reporting Language (XBRL): (i) condensed consolidated balance sheets, (ii) condensed consolidated statements of operations, (iii) condensed consolidated statements of comprehensive loss, (iv) condensed consolidated statements of cash flows and (v) notes to condensed consolidated financial statements (detail tagged).
|
Signatures
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Stanley T. Crooke
|
|
Chairman of the Board, President, and Chief Executive Officer
|
|
|
Stanley T. Crooke, M.D., Ph.D.
|
(Principal executive officer)
|
August 4, 2014
|
||
|
|
|
|
|
/s/ Elizabeth L. Hougen
|
|
Senior Vice President, Finance and Chief Financial Officer
|
|
|
Elizabeth L. Hougen
|
(Principal financial and accounting officer)
|
August 4, 2014
|
(A) | (if applicable) the highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers' fees) paid by the Interested Stockholder or any of its Affiliates for any shares of such class (or series) of Voting Stock acquired by them within the two‑year period immediately prior to the Announcement Date or in any transaction in which it became an Interested Stockholder, whichever is higher, plus interest compounded annually from the Determination Date through the Consummation Date at the publicly announced reference rate of interest of Bank of America, N.T. & S.A. (or such other major bank headquartered in the State of California as may be selected by the Continuing Directors) from time to time in effect in the City of San Francisco less the aggregate amount of any cash dividends paid, and the Fair Market Value of any dividends paid in other than cash, on each share of such class (or series) of Voting Stock from the Determination Date through the Consummation Date in an amount up to but not exceeding the amount of interest so payable per share of such class (or series) of Voting Stock; |
1.
|
Dissolution of the TTR Steering Committee
.
Section 6
(TTR Steering Committee) of the TTR Amendment shall be deleted in its entirety and shall be of no further force or effect. The TTR Steering Committee hereafter shall be deemed to be dissolved. For the avoidance of doubt, the dissolving of the TTR Steering Committee shall not affect any decisions which were made by the TTR Steering Committee prior to the Amendment No. 3 Effective Date and which were documented in the final, approved minutes of the relevant TTR Steering Committee meeting. Such prior decisions of the TTR Steering Committee, unless and until any such decisions are modified by the JSC, shall continue to be valid. From the Amendment No. 3 Effective Date and going forward, the JSC as established by the Collaboration Agreement shall also have governance oversight for the TTR Program in accordance with the terms set forth in
Section 1.3
of the Collaboration Agreement (as such Section is modified by this Amendment No. 3).
|
2.
|
Dissolution of the IDJSC
.
Sections 1.3.6
through
1.3.10
of the Collaboration Agreement shall be deleted in their entirety and shall be of no further force or effect. The IDJSC hereafter shall be deemed to be dissolved. For the avoidance of doubt, the dissolving of the IDJSC shall not affect any decisions which were made by the IDJSC prior to the Amendment No. 3 Effective Date and which were documented in the final, approved minutes of the relevant IDJSC meeting. Such prior decisions of the IDJSC, unless and until any such decisions are modified by the JSC, shall continue to be valid. From the Amendment No. 3 Effective Date and going forward, the JSC as established by the Collaboration Agreement shall also have governance oversight for the ID/Additional Programs in accordance with the terms set forth in
Section 1.3
of the Collaboration Agreement (as such Section is modified by this Amendment No. 3).
|
3.
|
Amendment of
Section 1.3.1
of the Collaboration Agreement.
The first paragraph of
Section 1.3.1
of the Collaboration Agreement shall be deleted in its entirety and replaced with the following:
|
4.
|
Amendment of
Section 1.3.2
of the Collaboration Agreement.
Section 1.3.2
of the Collaboration Agreement shall be deleted in its entirety and replaced with the following:
|
(a)
|
review progress on improvements to Antisense technology and advances in mechanistic understandings of Antisense technology;
|
(b)
|
review and provide advice on the Collaboration Program Research Plan (defined below) for each Collaboration Program, and the Early Development Plan (defined below) for each Development Candidate;
|
(c)
|
review the overall progress of Isis' efforts to discover, identify, optimize and otherwise Develop Compounds under each Collaboration Program;
|
(d)
|
in each case subject to [***], review and provide advice on (i) the design and content of the Phase I Success Criteria and the Phase I Trial Design/Endpoints for each ID/Additional Program, including design of, and human patient allocation in, all Clinical Studies, (ii) the design and content of the PoC Success Criteria for each Collaboration Program, and (iii) the PoC Trial Design/Endpoints for each Collaboration Program;
|
(e)
|
discuss and approve the design and expenditure for animal efficacy studies for the ID/Additional Programs;
|
(f)
|
review and determine whether In Vivo Efficacy has been demonstrated under the ID/Additional Programs;
|
(g)
|
coordinate and manage activities to develop the regulatory strategy and CMC strategy for the TTR Program through Option exercise to ensure a smooth transition of such activities; and
|
(h)
|
such other review and advisory responsibilities as may be assigned to the JSC pursuant to this Agreement or as may be mutually agreed upon in writing by the Parties from time to time."
|
5.
|
JSC Subcommittee(s).
The following new
Section 1.3.6
shall be added to the Collaboration Agreement:
|
6.
|
TTR Project Team.
The following new
Section 1.3.7
shall be added to the Collaboration Agreement:
|
(i)
|
Review the TTR Registration-Directed Program Documents from time to time and prepare Material Amendments, if any, to the TTR Registration-Directed Program Documents to be approved by the JSC;
|
(ii)
|
Develop CMC strategy and manage development activities, including process development, formulation development, quality control, stability tests, scale up, etc.;
|
(iii)
|
Manage the manufacture and supply of API and/or finished product for Clinical Studies;
|
(iv)
|
Review and oversee the clinical monitoring program and the statistical analysis plan (including establishing a mutually agreed process for GSK to participate in in-stream safety data review with Isis);
|
(v)
|
Develop regulatory strategy and coordinate, review and oversee regulatory activities conducted under the TTR Registration-Directed Program Documents;
|
(vi)
|
Facilitate sharing of data and information between the Parties' regulatory teams to ensure each Party's access to all data;
|
(vii)
|
Coordinate meetings and other interactions (including written correspondence with Regulatory Authorities); and
|
(viii)
|
Develop a transition plan prior to GSK's exercise of the Option, including coordinating the transfer of manufacturing technology and delivery of regulatory materials, and execute such plan.
|
7.
|
As of the Amendment No. 3 Effective Date, each reference to the TTR Steering Committee and to the IDJSC as set forth in the Collaboration Agreement shall be construed and interpreted to mean and to refer solely to the JSC.
|
8.
|
Miscellaneous.
Except as expressly set forth herein, this Amendment No. 3 shall not be construed to modify any of the Parties' respective rights and obligations under the Collaboration Agreement. This Amendment No. 3 shall be construed and interpreted according to the laws of the State of Delaware, without regard to conflicts of laws principles. This Amendment No. 3 may be executed in more than one counterpart, each of which shall be deemed to be an original but all of which taken together shall be deemed a single instrument. A facsimile transmission of the signed Amendment No. 3 will be legal and binding on both Parties. This Amendment No. 3 shall be incorporated into and shall, as of the Amendment No. 3 Effective Date, form part of the Collaboration Agreement between the Parties.
|
1.
|
GSK-5 Program – Natural History Study
.
|
a.
|
The Parties will conduct the Natural History Study as part of the GSK-5 Development Plan. GSK and Isis [***] a clinical research organization ("
CRO
") to conduct the Natural History Study, and Isis will thereafter negotiate and enter into an agreement with such CRO for the conduct of such study with terms reasonably acceptable to GSK (the "
CRO Contract
"), it being understood that GSK will provide Isis comments to the terms of the CRO Contract, if any, within [***] ([***]) Business Days of receiving a draft of such CRO Contract from Isis. Notwithstanding the preceding sentence, and subject to
Section 1.b
and
Section 1.c
, if GSK and Isis cannot agree on a term in the CRO Contract, [***] will have final decision-making authority with respect to such term (provided that, such decision is in accordance with the GSK-5 Development Plan and would not result in an increase in External Costs above [***]). For avoidance of doubt, nothing in this Amendment No. 4 requires Isis to amend any agreement between Isis and any Third Party CRO that is in effect as of the Amendment No. 4 Effective Date. The Parties intend that the CRO Contract will be executed by Isis as soon as reasonably practicable after the Amendment No. 4 Effective Date. Such CRO Contract will specify that [***] and that, as between GSK and Isis, [***]. Isis will ensure that the CRO Contract includes provisions that [***] and [***].
|
b.
|
Promptly after the Amendment No. 4 Effective Date, the Parties will agree upon a protocol for the conduct of the Natural History Study (the "
Initial Natural History Study Protocol
"). Isis shall be responsible for all of the costs for the conduct of the mutually-agreed Natural History Study (excluding any costs incurred by GSK), provided that Isis shall only be responsible for external costs for the Natural History Study (the "
External Costs
") up to [***] ($[***]) (the "
Isis Natural
History Study Cost Cap
"). GSK will use reasonable efforts to [***] in accordance with the timeline included in the Natural History Study protocol. GSK will be responsible for the payment of all External Costs that exceed the Isis Natural History Study Cost Cap except to the extent such excessive costs result from [***].
|
c.
|
Isis will not make any changes to the Initial Natural History Study Protocol or authorize or direct the CRO to do any work that is outside the scope of the Initial Natural History Study Protocol that would result in External Costs above the Isis Natural History Study Cost Cap, without GSK's prior written consent. GSK will not make any changes to the Initial Natural History Study Protocol or authorize or direct the CRO to do any work that is outside the scope of the Initial Natural History Study Protocol that would increase Isis's internal FTE costs for the conduct of such Natural History Study as compared to Isis's internal FTE costs for the conduct of the Initial Natural History Study Protocol without Isis's prior written consent.
|
2.
|
GSK-5 Program – PoC Trial
.
|
a.
|
Proof of Concept (PoC) Trial
. The initial agreed-upon GSK-5 Development Plan is attached to this Amendment No. 4 as
Attachment 1
. The Parties [***] as set forth in the attached GSK-5 Development Plan. The Parties will meet approximately [***] ([***]) [***] after the [***] to evaluate the progress of the Natural History Study, determine [***], discuss [***] the Natural History Study and discuss [***] on the [***]. As soon as reasonably practicable and in no event later than the [***] ([***]) day following the date when [***] ([***]) of the subjects participating in the Natural History Study complete [***] ([***]) [***], the Parties will discuss in good faith and, subject to [***], will [***] the final study design and endpoints for the multiple-dose portion of the PoC Trial, which the Parties anticipate will be substantially in the form set forth for the PoC Trial study design and endpoints in the initial GSK-5 Development Plan.
|
b.
|
As soon as reasonably practicable, Isis will provide GSK a summary of the data under the single-dose portion of the PoC Trial up to and including the [***] ([***]) day after the day on which the [***] in the single-dose portion of the PoC Trial (the
"
[
***
]
"
). Provided Isis has delivered the [***] to GSK, Isis may deliver to GSK a written notice stating Isis' desire to begin the multiple-dose portion of the PoC Trial (a
"Request to Continue"
). Within [***] ([***]) days after receipt of a Request to Continue, GSK will (subject to Section 2.c of this Amendment No. 4 below) deliver to Isis a written notice ("
Notice to Continue
") authorizing Isis to begin the multiple-dose portion of the PoC Trial pursuant to either (i) [***], or (ii) [***]. GSK will specify in its Notice to Continue whether the study design and endpoints for the multiple-dose portion of the PoC Trial for which GSK has authorized Isis to proceed are as set forth in (i) or (ii) above. For clarity, if GSK has not received a Request to Continue, GSK may deliver a Notice to Continue to Isis at any time.
|
c.
|
If, by [***] ([***]) days after receipt of the Request to Continue, GSK has not provided Isis a Notice to Continue, then GSK's Option with respect to the GSK-5 Program will automatically expire and, subject to
Section 5.10
of the Agreement (as amended by this Amendment No. 4), Isis will be free to develop and commercialize any Compounds that were included in the GSK-5 Program on its own or with a Third Party and, except as specified in
Section 5.10
of the Agreement (as amended by this Amendment No. 4), GSK will have no further rights to the GSK-5 Program (including all Compounds included therein) and [***] will no longer be a Collaboration Target. Following any expiration of an Option under this
Section 2.c
, GSK will promptly transfer to Isis all data, results and information related to the testing and studies in the GSK-5 Program in the possession of GSK and its contractors to the extent such data, results and information were generated by or on behalf of GSK under the Agreement (as amended by this Amendment No. 4).
|
d.
|
Except as provided under
Section 2.c
of this Amendment No. 4, the multiple-dose portion of the PoC Trial shall not be initiated until the final GSK-5 Development Plan, including the final study design and endpoints for the multiple-dose portion of the PoC Trial (which shall be subject to [***]), have been agreed upon. Following GSK's Option exercise, decision-making for the GSK-5 Program will be governed in accordance with
Section
3.c.ii of this Amendment No. 4.
|
3.
|
GSK-5 Program –Costs
.
|
a.
|
Development Costs Paid by Isis
. Isis will be responsible for, and will use Commercially Reasonable Efforts to perform, Isis' activities under the GSK-5 Development Plan and will be responsible for all costs and expenses associated therewith, except to the extent such costs and expenses have otherwise been allocated to GSK under
Section 1,
Section 3.c
or
Section 5
of this Amendment No. 4.
|
b.
|
Manufacturing Costs Paid by Isis
. Subject to
Section
5 of this Amendment No. 4 and until GSK exercises its Option for the GSK-5 Program in accordance with the Agreement (as amended by this Amendment No. 4), Isis will be solely responsible for the costs and expense for the Costs of Goods for the GSK-5 Development Plan. As included herein, "
Cost of Goods
" means [***].
|
c.
|
Development Costs Paid by GSK
.
|
i.
|
Before Option Exercise
.
Until GSK exercises its Option for the GSK-5 Program in accordance with the Agreement (as amended by this Amendment No. 4), GSK will be responsible for and will use Commercially Reasonable Efforts to perform the activities allocated to GSK under the GSK-5 Development Plan, and shall be responsible for payment of all costs and expenses related to GSK's conduct of such activities. In addition, GSK will be responsible for External Costs above the Isis Natural History Study Cost Cap as set forth in
Section
1.b
of this Amendment No. 4, and for any Additional Costs resulting from Approved Changes. If Additional Costs result from Approved Changes (excluding changes to the Natural History Study), then Isis will deliver to GSK [***] an invoice for such portion of the Additional Costs that is allocated for the activities [***] [***], and GSK will pay each such invoice within [***] ([***]) days after GSK's receipt.
|
ii.
|
After Option Exercise
. Without limiting the terms set forth in the Agreement, after GSK exercises its Option for the GSK-5 Program, GSK will be solely responsible for and will have sole decision making authority over all Development and Commercialization activities for the GSK-5 Program;
provided, however
, that Isis will continue to be responsible for the completion of the PoC Trial in accordance with the GSK-5 Development Plan in place at the time of such Option exercise, including payment of the costs and expenses associated therewith except to the extent such costs and expenses have otherwise been allocated to GSK under
Section 1,
Section 3.c
or
Section
5 of this Amendment No. 4, and Isis will continue to be responsible for all activities allocated to Isis under the GSK-5 Development Plan, including completion of reports and other activities allocated to Isis under such GSK-5 Development Plan. In addition, after such Option exercise by GSK, GSK will be solely responsible for all costs and expenses associated with Development, Manufacture and Commercialization of Licensed Compounds and related Licensed Products from the GSK-5 Program, excluding those costs and expenses for those activities for which Isis is responsible under the GSK-5 Development Plan, or for which Isis is otherwise responsible to provide at no cost to GSK under
Section 4.2
of the Agreement.
|
4.
|
Option
.
|
a.
|
Following GSK's receipt of (i) a notice from Isis that the PoC Trial is Completed, and (ii) the PoC Data Package (as defined in this Amendment No. 4) for the GSK-5 Program (such notice and package, the "
GSK-5 PoC Trial Completion Package
"), GSK will provide written notice to Isis of its decision whether to exercise its Option to the GSK-5 Program on or before 5:00 p.m. (Eastern time) on the [***] day following GSK's receipt of the GSK-5 PoC Trial Completion Package (the "
GSK-5 Option Deadline
"). If GSK does not provide written notice to Isis of GSK's exercise of the GSK Option for the GSK-5 Program before the GSK-5 Option Deadline, then
GSK's Option to the GSK-5 Program will expire and, subject to
Section 5.10
of the Agreement (as amended by this Amendment No. 4), Isis will be free to Develop and Commercialize any Compounds that were included in the GSK-5 Program on its own or with a Third Party and, except as specified in
Section 5.10
of the Agreement (as Amended by this Amendment No. 4), GSK will have no further rights to the GSK-5 Program (including all Compounds included therein) and [***] will no longer be a Collaboration Target. Following any expiration of an Option under this
Section 4
, GSK will promptly transfer to Isis all data, results and information related to the testing and studies in the GSK-5 Program in the possession of GSK and its contractors to the extent such data, results and information were generated by or on behalf of GSK under the Agreement (as amended by this Amendment No. 4).
|
b.
|
Early Exercise of an Option
.
For the avoidance of doubt, notwithstanding anything to the contrary in this Amendment No. 4 or in the Agreement, GSK will have the right to exercise its Option for the GSK-5 Program prior to GSK's receipt of a GSK-5 PoC Trial Completion Package in accordance with the terms of the Agreement (as amended by this Amendment No. 4).
|
5.
|
Material Amendments to the GSK-5 Development Plan for the PoC Trial
.
|
a.
|
Overview
.
As of the Amendment No. 4 Effective Date, the Parties have agreed to the GSK-5 Development Plan (which is attached hereto as
Attachment 1
).
|
b.
|
Material Amendments
. Subject to
Section 5.d
of this Amendment No.4, no Material Amendments may be made without both Parties' prior written consent. If any Regulatory Authority requires or, based on feedback from a Regulatory Authority, either Party requests a change to the PoC Trial or the GSK-5 Development Plan that would require the Parties to make Material Amendment to the GSK-5 Development Plan to effect such a change, the Parties will use good faith and commercially reasonable efforts to mutually agree on such Material Amendment (including any associated Additional Costs and payment schedule thereof) within [***] ([***]) days of receiving such proposed change from such Regulatory Authority or a Party.
|
c.
|
Material Amendments Process.
|
i.
|
If the Parties mutually agree to make such a Material Amendment (excluding Material Amendments to the Natural History Study) (including any associated Additional Costs and the payment schedule thereof), such proposed Material Amendment shall be deemed an Approved Change, and the GSK-5 Development Plan will be amended to expressly incorporate such Approved Change. Thereafter, Isis and GSK (as applicable) will continue to conduct the GSK-5 Development Plan in accordance with such amended GSK-5 Development Plan.
|
ii.
|
If, despite the Parties' good faith and Commercially Reasonable Efforts, the Parties cannot agree (i) on whether to make the proposed Material Amendment to the GSK-5 Development Plan (including agreement on the scope of such proposed Material Amendment or any associated Additional Costs, and the payment schedule thereof) or (ii) whether such proposed amendment qualifies as a Material Amendment, in each case, within [***] ([***]) days of receiving such proposed change from such Regulatory Authority or a Party, the dispute will be promptly (but no later than [***] days after the end of such [***] ([***]) day period) referred to the [***]. If the [***] cannot resolve the matter within [***] ([***]) Business Days after receiving such dispute then, subject to
Section 2.c
of this Amendment No. 4, the Parties will continue the activities under the GSK-5 Program (including the PoC Trial) under the then-current GSK-5 Development Plan, until such matter is resolved by the Parties (if ever) or the GSK-5 Program is terminated in accordance with the Agreement or this Amendment No. 4. Notwithstanding anything to the contrary in the Agreement or this Amendment No. 4, [***] with respect to changes to the study design and endpoints for the multiple-dose portion of the PoC Trial,
provided that
(i) changes made as a result of [***] shall be deemed Approved Changes for which [***] and (ii) with respect to the multiple-dose portion of the PoC Trial, [***] to (x) [***], (y) [***], or (z) [***].
|
d.
|
Non-Material Amendments
. Isis will consider in good faith any changes to the GSK-5 Development Plan that are requested by GSK that do not require the Parties to make a Material Amendment to the GSK-5 Development Plan to affect such a change. Isis shall have the ability to make any changes to the GSK-5 Development Plan that do not require the Parties to make a Material Amendment to the GSK-5 Development Plan to affect such a change without the prior consent of GSK,
provided, that
such changes [***].
|
e.
|
The process for Approved Changes as set forth in this Section 5 shall not apply to Approved Changes for the Natural History Study, which are addressed exclusively by
Section 1
of this Amendment No. 4.
|
6.
|
Financial Provisions
. The following revised financial provisions will apply solely to the GSK-5 Program:
|
a.
|
Milestone Payments for First Achievement of Development Milestone Event
. Solely with respect to a Compound under the GSK-5 Program that first achieves a Development Milestone Event by or on behalf of GSK or its Affiliates or Sublicensees, Column 1 of
Table 2
set forth in
Section 5.5.1
(Milestone Payments for First Achievement of Development Milestone Event) of the Agreement is hereby deleted in its entirety and replaced with
Table 2A
below.
|
Table 2A
|
|
Development Milestone Events for the GSK-5 Program
|
Milestone Payment
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]*
|
[***]
|
[***]*
|
[***]
|
Total Development Milestone Payments for the GSK-5 Program
|
[***]
|
b.
|
GSK-5 Program Option Exercise Fee
. Upon the exercise by GSK of the Option for the GSK-5 Program, if exercised by GSK in accordance with the Agreement (as amended by this Amendment No. 4), in lieu of the [***] ([***]) Option exercise fee set forth in
Column 1
of
Table 1
in
Section 5.4
(Option Exercise Fees) of the Agreement, GSK will pay Isis an Option exercise fee of [***] ([***]) for the GSK-5 Program. Such Option Exercise Fee will be paid within [***] ([***]) days after receipt by GSK of an invoice sent from Isis on or after such Option exercise under the Agreement (as amended by this Amendment No. 4).
|
c.
|
Milestone Payments for First Achievement of Sales Milestone Event
. Solely with respect to a Licensed Product under the GSK-5 Program that first achieves the listed events (as set forth in Table 4A below) by or on behalf of GSK, its Affiliates or Sublicensees,
Table 4
set forth in
Section 5.7.1
(Milestone Payments for First Achievement of Sales Milestone Event) of the Agreement is deleted in its entirety and replaced with
Table 4A
below:
|
Table 4A
|
|
GSK-5 Sales Milestones for each Licensed Product in the GSK-5 Program
|
Milestone Payment
|
[***] in worldwide Annual Net Sales
|
[***]
|
[***] in worldwide Annual Net Sales
|
[***]
|
[***] in worldwide Annual Net Sales
|
[***]
|
[***] in worldwide Annual Net Sales
|
[***]
|
Total GSK-5 Sales Milestone Payments for the GSK-5 Program
|
[***]
|
7.
|
GSK-5 Program Royalties
. Solely with respect to the Licensed Products under the GSK-5 Program sold by GSK, its Affiliates or Sublicensees,
Table 5
set forth in
Section 5.9.1
(GSK Patent Royalty) of the Agreement is deleted in its entirety and replaced with
Table 5A
below:
|
Table 5A
|
|
Worldwide Annual Net Sales of each Licensed Product in the GSK-5 Program
|
Royalty Rate
|
For the portion up to and including $[***]
|
[***]%
|
For the portion above $[***] and up to and including $[***]
|
[***]%
|
For the portion above $[***]
|
[***]%
|
8.
|
GSK-5 Program Reverse Royalties
. Solely with respect to any GSK-5 Program Discontinued Products,
Table 6
set forth in
Section 5.10.1
(Reverse Royalty for Discontinued Products) of the Agreement is deleted in its entirety and replaced with
Table 6A
below:
|
Table 6A
|
|
Development/Regulatory Status of Discontinued Product at time of reversion under this Agreement
|
Applicable Royalty Rate on worldwide Annual Net Sales of Discontinued Product
|
Discontinued Products for which GSK has paid Isis the [***] milestone payment
|
[***]%
|
After [***] but prior to [***]
|
[***]%
|
After [***] but prior to [***]
|
[***]%
|
After [***]
|
[***]%
|
9.
|
No Impact on Other Collaboration Programs
. Except as otherwise expressly amended by this Amendment No. 4, the Agreement remains in full force and effect in accordance with its terms. For the avoidance of doubt, this Amendment No. 4 is solely intended to modify certain terms of the Agreement regarding the GSK-5 Program, and does not amend the Agreement in any way with respect to the other Collaboration Programs.
|
10.
|
GSK's Right to Terminate for Convenience
. This Section 10 of this Amendment No. 4 supersedes and replaces
Section 9.2.1
of the Agreement with respect to the GSK-5 Program, including GSK's right to terminate the GSK-5 Program under
Section 9.2.1
of the Agreement. In lieu of GSK's right to terminate under
Section 9.2.1
of the Agreement, at any time following the Amendment No. 4 Effective Date, GSK will be entitled to terminate the Agreement (as amended by this Amendment No. 4) with respect to the GSK-5 Program by providing Isis ninety (90) days prior written notice;
provided however
, if GSK terminates the Agreement (as amended by this Amendment No. 4) with respect to the GSK-5 Program
and
at the effective date of such termination, Isis had spent in Development of the GSK-5 Program (including actual external costs and Isis' good faith estimate of its internal FTE costs) at least an amount equal to (a) [***] ([***])
plus
(b) [***], then if such notice of termination by GSK is:
|
(i)
|
before [***] for the GSK-5 Program and [***], GSK will pay Isis [***] percent ([***]%) of the milestone payment for [***] for the GSK-5 Program and [***] percent ([***]%) of the milestone payment for [***],
|
(ii)
|
before [***] for the GSK-5 Program but after [***], GSK will pay Isis [***] percent ([***]%) of the milestone payment for [***] for the GSK-5 Program,
|
(iii)
|
after [***] for the GSK-5 Program but before [***], GSK will pay Isis [***] percent ([***]%) of the milestone payment for [***],
|
(iv)
|
after [***] for the GSK-5 Program and after [***] but before [***], GSK will pay Isis [***] percent ([***]%) of the milestone payment for [***],
|
(v)
|
after [***], GSK will pay Isis [***] percent ([***]%) of the milestone payment for [***];
provided, that
:
|
(A) | if the [***] does not occur within [***] ([***]) months of such notice of termination by GSK, then [***]: (a) such [***], minus the sum of: (b) [***], and (c) [***]; or |
(B) | if the [***] occurs within [***] ([***]) months of such notice of termination by GSK, and [***], then [***]; or |
(C) | if the [***] occurs within [***] ([***]) months of such notice of termination by GSK, and [***], Isis will [***]. |
11.
|
Special Consequences for Voluntary Termination by GSK under Section 10 of this Amendment No. 4.
In the event of a termination with respect to the GSK-5 Program under
Section 10
of this Amendment No. 4, then:
|
a.
|
the licenses granted by Isis to GSK under the Agreement with respect to the GSK-5 Program will terminate and GSK, its Affiliates and Sublicensees will cease selling all Licensed Products from the GSK-5 Program; provided that GSK, its Affiliates and Sublicensees will have the right to sell any remaining inventory of such Licensed Products over a period of no greater than [***] ([***]) months after the effective date of such termination and GSK will pay Isis royalties in accordance with
Section 7
of this Amendment No. 4 on the Net Sales of such inventory of Licensed Products;
|
b.
|
GSK will perform the obligations under
Section 4.2.1
of the Agreement for the GSK-5 Program, as though such obligations under
Section 4.2
of the Agreement were obligations owed by GSK to Isis, to the extent applicable and in GSK's Control
mutatis mutandis
; and
|
c.
|
except as explicitly set forth in this
Section 11
, or
Sections 9.3.3
,
9.3.4
or
9.3.5
of the Agreement, GSK will have no further rights and Isis will have no further obligations with respect to the GSK-5 Program.
|
12.
|
Collaboration Term
. Solely with respect to the GSK-5 Program, notwithstanding anything to the contrary in the Agreement, the Collaboration Term for the GSK-5 Program is extended such that it ends on March 30, 2015.
|
13.
|
Definitions
. Capitalized terms not otherwise defined herein will have the meanings given in the Agreement. For purposes of this Amendment No. 4, the following capitalized terms will have the following meanings:
|
a.
|
"
Additional Costs
" means, [***].
|
b.
|
"
Approved Changes
" means any changes (including duration of dosing, additional studies, additional endpoints, additional analysis, additional drug supply, etc.) to the GSK-5 Development Plan (i) that are requested by a Party or required by a Regulatory Authority, (ii) that are required to be agreed upon by the Parties under this Amendment No. 4, and (iii) that are in fact agreed upon by GSK and Isis in accordance with this Amendment No. 4 or are decided through [***] final decision making authority under
Section 5.c.
of this Amendment No. 4. For the avoidance of doubt, changes made to the Natural History Study in accordance with the terms of Section 1 of this Amendment No. 4 and changes made to the GSK-5 Development Plan that do not result in a Material Amendment shall not be considered "Approved Changes" as that term is used in this Amendment No. 4.
|
c.
|
"
Complete
", "
Completed
", or "
Completion
" means the point in time at which the primary database lock for the study data for the PoC Trial has occurred and the data generated based on that primary database lock under the statistical analysis plan for the PoC Trial are available.
|
d.
|
"
Cost of Goods
" has the meaning set forth in
Section 3.b
of this Amendment No. 4.
|
e.
|
"
CRO
" has the meaning set forth in
Section 1.a
of this Amendment No. 4.
|
f.
|
"
CRO Contract
" has the meaning set forth in
Section 1.a
of this Amendment No. 4.
|
g.
|
"
External Costs
" has the meaning set forth in
Section 1.b.
of this Amendment No. 4.
|
h.
|
"
GSK-5 Development Plan
" means the Development plan attached to this Amendment No. 4 as
Attachment
1,
which may be amended from time to time pursuant to
Section 5
of this Amendment No. 4
.
|
i.
|
"
GSK-5 Option Deadline
" has the meaning set forth in
Section 4
of this Amendment No. 4.
|
j.
|
"
GSK-5 PoC Trial Completion Package
" has the meaning set forth in
Section 4
of this Amendment No. 4.
|
k.
|
"
GSK-5 Program
" has the meaning set forth in the recitals.
|
l.
|
[***]
|
m.
|
[
***
]
|
n.
|
[***]
|
o.
|
"
Material Amendment
" means an amendment to one (1) or more of the bullet-point items set forth in the GSK-5 Development Plan included in
Appendix A
, attached to this Amendment No. 4 and incorporated herein by reference.
|
p.
|
"
Natural History Study
" means a study intended to follow the natural progression of [***] in patients with the [***], as more fully described in Attachment 1.
|
q.
|
"
Natural History Study Cost Cap
" has the meaning set forth in Section 1.b. of this Amendment No. 4.
|
r.
|
"
PoC Data Package
" means, with respect to the GSK-5 Program Development Candidate, (i) [***], (ii) [***], (iii) [***], (iv) [***], (v) copies of all filings submitted to Regulatory Authorities, (vi) [***], and (vii) [***]. In the event that GSK elects to exercise its early Option to the GSK-5 Program in accordance with the Agreement (as amended by this Amendment No. 4), the PoC Data Package will be interpreted to mean the items set forth in this
Section 13.r
(i) through (vii) to the extent such items are available at the time that GSK notifies Isis of GSK's election to exercise such early Option.
|
s.
|
"
PoC Trial
" means a clinical study for the GSK-5 Program, consisting of a two-part, multicenter, open-label study of the GSK-5 Development Candidate, including single dose (part 1) and multiple dose (part 2) cohorts, as described in the GSK-5 Development Plan.
|
1.
|
Amendment of Activities under [***] Program.
The [***] Program is hereby amended to include work on the compounds listed on
Appendix 4
attached hereto (each, a
"Research Lead"
) which (unless excluded under
Section 11(a)
of this Amendment No. 5) are acknowledged to be Compounds under the [***] Program.
|
2.
|
***] DC Development Plan
. The initial Development plan for the potential [***] DC is attached hereto as
Appendix 1
. After the selection of the [***] DC in accordance with
Section 3
of this Amendment No.5, GSK will promptly provide Isis with an updated Development plan for the [***] DC, and thereafter will update such Development plan on at least [***] basis until such time as the [***] Option is exercised (or otherwise expires). After Option exercise, GSK will provide updates as required under
Section 4.3.2
and
Section 4.3.3
of the Agreement.
|
3.
|
Research Activities; Selection of [***] DC
. Isis will use Commercially Reasonable Efforts to conduct the [***] DC Confirmation Activities set out in
Column 3
of
Appendix 2
attached hereto, with the goal of achieving the [***] DC Criteria, as follows:
|
a.
|
Isis will use Commercially Reasonable Efforts to complete a study testing [***] (as further described and in accordance with
Column 3
of
Appendix 2
of this Amendment No.5) to provide [***] (the
"Research Lead Study"
).
|
b.
|
Once the Research Lead Study has been completed, Isis will provide GSK written notice thereof, including a summary of the results of the Research Lead Study (such notice and summary the
"Research Lead Data Package"
). Within [***] ([***]) days of its receipt of the Research Lead Data Package, GSK will designate [***] (the
"Prioritized Lead"
) to advance as described in
Section 3.c.
of this Amendment No. 5.
|
c.
|
For the Prioritized Lead, Isis will use Commercially Reasonable Efforts to complete (i) [***], and (ii) [***], (all as further described and in accordance with
Column 3
of
Appendix 2
of this Amendment No.5) such [***] to be agreed and finalized in advance by the JSC (the
"Prioritized Lead Studies"
). Once the Prioritized Lead Studies have been completed, Isis will provide the JSC written notice thereof, including the data and results of the Prioritized Lead Studies (the
"Prioritized Lead Data Package"
). Within [***] days of its receipt of the Prioritized Lead Data Package, [***] will determine whether the Prioritized Lead meets the applicable criteria for designating a development candidate under
Column 3 of Appendix 2
(the
"
[
***
]
DC Selection Criteria"
). Unless within such [***] day period [***] determines (or by written notice GSK informs Isis that) the Prioritized Lead has not met the [***] DC Selection Criteria, then the Prioritized Lead will be the [***] DC. If within such [***] day period [***] determines (or by written notice GSK informs Isis that) the Prioritized Lead has not met the [***] DC Selection Criteria, then within [***] days of such determination, GSK may designate an additional Research Lead as a Prioritized Lead, and Isis and GSK will repeat the process set forth in this
Section 3.c
. of this Amendment No. 5 until the earlier of the date (y) an [***] DC is designated, or (z) each Research Lead has been tested in the studies set forth in this
Section 3.c
of this Amendment No. 5, but no such Research Lead has been designated an [***] DC. If the Parties do not designate an [***] DC under this
Section 3.c
. of this Amendment No. 5 then, unless otherwise mutually agreed to by the Parties in writing, no Compound will be an [***] DC and Isis will have no further obligations under this Amendment No. 5.
|
d.
|
Isis will be responsible for all costs and expenses associated with the studies under this
Section 3
of this Amendment No. 5.
|
4.
|
[***] DC Development Activities Conducted by Isis and Paid for by GSK
.
|
a.
|
Isis' Manufacturing Responsibilities; CMC Characterization
.
|
i.
|
Isis will manufacture [***] of API for the Research Lead known as [***], to generate [***] of API. Isis will begin such activities within [***] ([***]) Business Days of Isis' receipt of the $[***] payment under clause (i) of
Section 4.c.
of this Amendment No. 5. Such API will be manufactured in accordance with cGMP and [***]. In addition, Isis will formulate an amount of such API into drug product that is sufficient (but no more than is necessary) to conduct the [***] and the [***] for the [***] DC, and which meets the requirements of cGLP. As soon as reasonably practicable (and using Commercially Reasonable Efforts to meet such timeframe as necessary to meet the scheduled start of the [***] as agreed between the Parties), Isis will deliver such drug product to the CRO, and deliver the remaining quantity of API to GSK, in each case [***]. GSK will pay Isis for its [***] to manufacture such API and drug product (subject to the principles set out in
Section 4(a)(ii)
below with respect to failed batches) as set out in
Rows A and B of Appendix 3
attached hereto, which include the actual cost charged by its appointed Third Party contract manufacturing organization to perform the conjugation work for such API and Isis' [***].
|
ii.
|
If Isis encounters any difficulties or hazards during the manufacture of such API that prevents Isis from successfully manufacturing API that meets the requirements of
Section 4(a)(i)
above with respect to quality and quantity, Isis will notify GSK within [***] days of such failure and will use Commercially Reasonable Efforts to manufacture a replacement batch of API, such that the CRO receives the formulated API in accordance with the requirements of
Section 4(a)(i)
above as close to the originally-scheduled delivery date as possible. For any such failed batch, the cost of the manufacture incurred by Isis will be [***] as follows: [***]; and, to the extent [***], [***];
except
, that [***]. Any such [***] under
Section 4.a.i
of this Amendment No. 5.
|
iii.
|
Isis will also use Commercially Reasonable Efforts to [***] (and perform the related [***] for the [***] for the [***] for the [***] DC. GSK will pay Isis for its internal FTE costs reasonably estimated to conduct such activities which have been calculated in accordance with [***] set out in
Section 4(d)
of this Amendment No. 5 and included in the costs outlined in
Row A
of
Appendix 3
hereto.
|
iv.
|
Isis and GSK will agree to a technology transfer plan and schedule pursuant to which Isis will provide to GSK (or to a Third Party manufacturer selected by GSK and reasonably agreed to by Isis) a technology transfer under
Section 4.2.1
of the Agreement solely to the extent necessary to enable GSK to fulfill its obligations to Develop the [***] DC under
Section 5
of this Amendment No. 5 prior to the [***] Option Deadline (including use of the API and formulated product supplied by Isis according to this Amendment No.5), and solely for the sole purpose of Developing the [***] DC. Isis will provide such transfer in a timely manner to facilitate GSK's activities in accordance with the [***] DC Development plan. If GSK believes in good faith that additional API for the [***] DC is necessary for GSK to fulfill its obligations to Develop the [***] DC under
Section 5
of this Amendment No. 5, then GSK will provide Isis written notice thereof, and the technology transfer plan will be expanded accordingly by mutual agreement. Isis will provide the first [***] ([***]) hours of such technology transfer [***], and thereafter GSK will pay Isis for [***] and any out-of-pocket costs to perform such activities ([***] in accordance with the principles set out in
Section 4(d)
of this Amendment No. 5). Isis will provide GSK an [***] GSK pursuant to this
Section 4(a)(iv)
in advance of initiating such activities. Until GSK approves the estimated cost to perform such an activity, Isis will not incur such cost and Isis will not be obligated to perform such activity.
|
v.
|
At GSK's request, Isis will use its Commercially Reasonable Efforts to refer the conduct of [***] for the [***] and [***] for the [***] DC manufactured by Isis to an established contract research organization Isis uses to perform such work;
provided
GSK will be solely responsible for managing such studies and the cost of such studies.
|
vi.
|
If a Compound that is not [***] is designated as the [***] DC, then at the same time as such designation, GSK will (i) pay Isis the Remaining Payment Due under
Section 4.c (iii)
of this Amendment No. 5 related to [***], and (ii) notify Isis if GSK intends to manufacture the API and drug product for such [***] DC itself or if GSK intends Isis to manufacture such API and drug product for such [***] DC. If GSK notifies Isis that GSK intends Isis to manufacture such API for such [***] DC, then at GSK's expense, as soon as reasonably practicable Isis will manufacture [***] of the API and related drug product for such [***] DC under the same terms and conditions as set forth in
Section 4.a
. of this Amendment No. 5 by adding such [***] DC to Isis' then existing queue for manufacturing compounds at Isis' facility [***] and the Parties will adjust the planned start of the [***] and [***] accordingly.
|
b.
|
[***].
Following [***], Isis will contract for the conduct of [***] and the [***] under the initial [***] DC Development Plan with an established contract research organization (the
"CRO"
) consistent with the requirements of
Section 4.1.7
and other applicable terms of the Agreement (with respect to sub-contracting), and will monitor the performance of such [***] by such CRO, including compliance with all Applicable Law. GSK will pay Isis for all of [***] and [***], as set out in
Row D of Appendix 3
.
|
c.
|
Payment by GSK.
GSK will pay Isis for the activities under this
Section 4
in accordance with the amounts set forth in
Appendix 3
attached hereto, as follows, (i) with respect to the payments due under
Section 4(a)
of this Amendment No. 5, upon [***], Isis will issue an invoice to GSK for $[***] (being the total amount due under the Initial Payment Column for
Rows A, B and C of Appendix 3
), and GSK will pay such invoice within [***] ([***]) Business Days following receipt of such invoice by GSK, (ii) with respect to the payments due under Section 4(b) of this Amendment No. 5, upon [***], Isis will invoice GSK for [***]% of the [***] and [***]% of the [***] to conduct the work under
Section 4.b
of this Amendment No. 5 (as described in the Initial Payment Column of
Row D of Appendix 3
), and GSK will pay such invoice within [***] ([***]) days of receipt of such invoice by GSK, and (iii) upon the occurrence of the applicable "Event Triggering Remaining Payment" listed on
Appendix 3
for the relevant activity, Isis will issue an invoice to GSK for the balance of any remaining payment due in respect of such activity as shown in the Remaining Payment Due column of
Appendix 3
, and GSK will pay such invoice within [***] ([***]) days of receipt of such invoice by GSK;
provided
always
that in the case of remaining payments under this sub-section (iii) of this
Section 4(c)
, such payments will only be due from GSK to Isis to the extent that [***].
|
d.
|
FTEs
. With respect to activities under this Amendment No. 5 that require GSK to reimburse Isis FTE costs, Isis will [***], and the then applicable [***] will apply. Isis' applicable [***] for the 2014 Calendar Year is $[***].
|
5.
|
GSK's Manufacturing and Development Responsibilities
.
|
a.
|
Except as expressly set forth in
Section 3
and
Section 4
of this Amendment No. 5, without prejudice to GSK's obligations under
Section 4.3
of the Agreement, as from the Amendment No.5 Effective Date until such time as GSK exercises its Option to the [***] Program (or until such Option expires), and provided Isis has fulfilled its obligations under
Section 4.a
and
Section 4.b
of this Amendment No. 5 (to the extent necessary for GSK to perform its obligations), GSK will use Commercially Reasonable Efforts to conduct all activities related to [***] the [***] DC, including but not limited to (i) [***] and [***] for the [***], (ii) [***], including the [***], (iii) [***], (iv) [***]. GSK will be responsible for all costs and expenses associated with the activities under this
Section 5.
Following GSK's exercise of its Option to the [***] Program, GSK's Development and Commercialization obligations shall be as set forth in
Section 4.3
of the Agreement.
|
b.
|
Commitment to Develop [***] DC.
Without limiting GSK's obligations under
Section 2.2
of the Agreement and except as otherwise required for GSK to fulfil its obligations under the Agreement or as otherwise requested by Isis, prior to GSK's exercise of its Option to the [***] Program, GSK will [***] without Isis' prior written consent.
|
c.
|
Development of Alternative [***] DC.
If based on the results of the [***] or the [***] for the first [***] DC, GSK in good faith (acting in accordance with its Commercially Reasonable Efforts) determines Development of such [***] DC should be terminated, GSK may terminate the Development of such [***] DC by providing Isis a written notice thereof within [***] ([***]) days following the completion of the [***] of such [***], or completion of the [***] (as applicable). In such case, the Parties will, as soon as reasonably practicable, hold a meeting of the JSC to discuss the merits of Developing a different Research Lead. Within [***] ([***]) days following such meeting of the JSC (or, in any event if the JSC has not met within [***] ([***]) days of the termination notice from GSK), GSK may provide Isis a written notice designating a Research Lead as a replacement [***] DC, in which case (i) such Research Lead will be the [***] DC, (ii) Isis will have no obligation to research, Develop or Manufacture such [***] DC, and (iii) GSK will use Commercially Reasonable Efforts to Develop such [***] DC up through the [***] Option Deadline [***].
|
6.
|
Safety Reporting; Data Integrity
.
|
a.
|
Safety Reporting.
GSK will report to Isis any serious adverse events (SAEs) and suspected unexpected serious adverse reactions (SUSARs) under any Clinical Study for the [***] DC being conducted by or on behalf of GSK prior to the date of [***] Option exercise, strictly in accordance with the timelines set out in the Safety Data Exchange Agreement (such timelines to ensure that each Party is able to meet all applicable legal and regulatory obligations in line with its own respective internal processes). In addition, GSK will provide Isis with [***] and [***] regarding adverse events and material lab findings under any Clinical Study for the [***] DC being conducted by or on behalf of GSK prior to the date of [***] Option exercise.
|
b.
|
Safety Data Exchange Agreement (or equivalent)
. As soon as reasonably practicable following the Amendment No. 5 Effective Date, and in any event no later than [***] days prior to the expected start of the first Clinical Study of the [***] DC (or such other date as may be agreed between the Parties), the pharmacovigilance representatives of each of Isis and GSK will meet and determine the appropriate approach to be taken for the collection, review, assessment, tracking, exchange and filing of information related to adverse events and safety data associated with a [***] DC during the period prior to GSK's exercise of its Option to the [***] Program, based on the activities being conducted by each Party under the Agreement and this Amendment No.5. Such approach will be documented between the Parties in writing in a separate safety data exchange agreement (to the extent such agreement is necessary) or other appropriate documentation, which will control with respect to the subject matter covered therein. Such documentation will be in accordance with, and will enable the Parties to fulfill, local and international regulatory reporting obligations to Regulatory Authorities and other Applicable Law as well as to meet their own respective internal policy requirements. After GSK's exercise of its Option to the [***] Program, the Parties will wind-down and discontinue the activities provided for under any such arrangements, but GSK will continue to provide Isis the cooperation and information described in
Section 4.4.1
of the Agreement as it relates to the [***] Program.
|
d.
|
Data Integrity
. GSK agrees that it will carry out its activities under the [***] Program and collect and record any data generated therefrom in a manner consistent with Good Data Management Practices. Prior to GSK's exercise of its Option for the [***] Program, GSK will, upon reasonable request by Isis permit review of relevant notebooks and records in GSK's possession or control by Isis during normal business hours.
|
7.
|
Option
.
|
b.
|
8.
|
Financial Provisions
. The following revised financial provisions will apply solely to the [***] Program:
|
b.
|
Milestone Payments for First Achievement of Development Milestone Event
. Solely with respect to Compounds under the [***] Program that first achieve a Development Milestone Event as a result of activities by or on behalf of GSK or its Affiliates or Sublicensees,
Table 3
set forth in
Section 5.6.1
(Milestone Payments for First Achievement of Development Milestone Event) of the Agreement is hereby deleted in its entirety and replaced with
Table 3A
below.
|
Table 3A
|
||
Development Milestone Events for the [***] Program
|
Milestone Payment 1
st
Indication
|
Milestone Payment 2nd Indication
|
[***]
|
$[***]
([***]) |
$[***]
|
[***]
|
$[***] ([***])
|
$[***]
|
[***]
|
$[***]
|
$[***]
|
[***]
|
$[***] ([***])
|
$[***]
|
[***]
|
$[***]
|
$[***]
|
[***]†
|
$[***]
|
$[***]
|
[***]
†
|
$[***]
|
$[***]
|
[***]
|
$[***]
|
$[***]
|
[***]††
|
$[***]
|
$[***]
|
[***]††
|
$[***]
|
$[***]
|
[***]
†††
|
$[***]
|
$[***]
|
[***]
|
$[***]
|
$[***]
|
Total Development Milestone Payments for the [***] Program
|
$[***]
|
$[***]
|
c.
|
Milestone Payments for First Achievement of Sales Milestone Event for [***] DC
. GSK will pay to Isis the applicable one-time milestone payments as set forth in
Table 4B
below after a Licensed [***] Product first achieves the listed events (as set forth in
Table 4B)
as a result of sales by or on behalf of GSK, its Affiliates or Sublicensees:
|
Table 4B
|
|
Sales Milestones for each Licensed [
***]
Product
|
Milestone Payment
|
$[***] in worldwide Annual Net Sales
|
$[***]
|
$[***] in worldwide Annual Net Sales
|
$[***]
|
$[***] in worldwide Annual Net Sales
|
$[***]
|
Total Sales Milestone Payments for the [***
] DC
Program
|
$[***]
|
9.
|
[***] DC Program Royalties
. Solely with respect to the Licensed [***] Products sold by GSK, its Affiliates or Sublicensees,
Table 5
set forth in
Section 5.9.1
(GSK Patent Royalty) of the Agreement is deleted in its entirety and replaced with
Table 5B
below:
|
Table 5B
|
|
Worldwide Annual Net Sales of each Licensed [
***]
Product
|
Royalty Rate
|
For the portion up to and including $[***]
|
[***]%
|
For the portion above $[***] and up to and including $[***]
|
[***]%
|
For the portion above $[***]
|
[***]%
|
10.
|
No Impact on Other Collaboration Programs
. Except as otherwise expressly amended by this Amendment No. 5, the Agreement (including
Section 5.7.1
and
Section 5.9.1
as it applies to Licensed Products under the [***] Program that are not Licensed [***] Products) remains in full force and effect in accordance with its terms. For the avoidance of doubt, this Amendment No. 5 is solely intended to modify certain terms of the Agreement regarding the [***] Program, and does not amend the Agreement in any way with respect to the other Collaboration Programs.
|
11.
|
Termination by Isis of Rights to [***]
DC.
(a)
If GSK, in Isis' reasonable determination, fails to use Commercially Reasonable Efforts under Section 5(a) of this Amendment No.5, Isis will notify GSK and within [***] ([***]) days thereafter, Isis and GSK will meet and confer to discuss and resolve the matter in good faith, and attempt to devise a mutually agreeable plan to address any outstanding issues related to GSK's use of Commercially Reasonable Efforts in Section 5(a). Following such a meeting, if GSK fails to use Commercially Reasonable Efforts as contemplated by Section 5(a), then subject to
Section 11(b)
below, Isis will have the right, at its sole discretion, to terminate GSK's rights under this Amendment No. 5 and the Agreement with respect to the [***] DC and the other Research Leads. In the case of such a termination, the [***] DC and other Research Leads will be excluded from the [***] Program, including GSK's Option and licenses to the [***] Program under Sections 3.1 and Section 4.1 under the Agreement.
|
12.
|
Special Consequences for Termination by Isis or Voluntary Termination by GSK.
In addition to the consequences set forth in
Section 9.3.2
of the Agreement (as applicable), in the event of (i) a termination of the Agreement either in its entirety or with respect to the [***] Program by Isis pursuant to
Section 9.2.2
or by GSK pursuant to
Section 9.2.1,
or (ii) a termination by Isis pursuant to
Section 11
above of this Amendment No.5, in each case ((i) and (ii)) prior to GSK's exercise of its Option for the [***] Program by GSK or upon the unexercised expiration of GSK's Option for the [***] Program and solely with respect to the [***] DC:
|
a.
|
GSK will perform the obligations under
Section 4.2.1
of the Agreement , as though such obligations under
Section 4.2.1
were obligations owed by GSK to Isis,
mutatis mutandis,
with respect to the [***] DC, except for such information as is already in Isis' possession at the date of termination;
|
b.
|
GSK will, at GSK's election and at its sole cost and expense, either (i) complete any ongoing Clinical Study for the [***] DC or (ii) subject to applicable law and regulatory consents, transfer sponsorship of any ongoing Clinical Study for the [***] DC to Isis together with the transfer of all of the rights and responsibilities thereunder, except as described in
Section 12(c)
below;
|
c.
|
If as part of terminating the [***] Program GSK terminates a Clinical Study for a [***] DC due to safety reasons as confirmed by GSK's Global Product Safety Board, then GSK cannot elect to complete such Clinical Study under
Section 12(b)(i)
above but will: (i) take such action consistent with its internal policies and applicable regulatory requirements to close out such Clinical Study (including, without limitation, notification to the FDA and withdrawal of the IND), and (ii) provide to Isis all data and information contained within or referenced in the IND and such other data and information within GSK's possession or control generated under the [***] Program (except for such information as is already in Isis' possession at the date of termination or as a result of the technology transfer under
Section 12.a.
above), at GSK's sole cost and expense. For clarity, in the circumstances described in this
Section 12(c)
, GSK will not be required to transfer the sponsorship of such terminated Clinical Study pursuant to
Section 12(b)(ii) above
.
|
d.
|
If GSK elects to transfer sponsorship to Isis under
Section 12(b)(ii)
above, the Parties agree to, as soon as practicable following the date of such termination or expiration according to this
Section 12,
negotiate in good faith a separate agreement to effect such transfer consistent with industry standards under similar circumstances and in accordance with each Party's respective internal policies.
|
13.
|
Governing Law; Counterparts
. This Amendment No. 5 and any dispute arising from the performance or breach hereof will be governed by and construed and enforced in accordance with the laws of the State of Delaware, U.S.A., without reference to conflicts of laws principles. This Amendment No. 5 may be signed in counterparts, each and every one of which will be deemed an original, notwithstanding variations in format or file designation which may result from the electronic transmission, storage and printing of copies of this Amendment No. 5 from separate computers or printers. Facsimile signatures and signatures transmitted via PDF will be treated as original signatures.
|
14.
|
Definitions
. Capitalized terms used in this Amendment No. 5 will have the meaning set forth in Appendix A attached hereto.
|
a.
|
"
CRO
" has the meaning set forth in
Section 4.b
of this Amendment No. 5.
|
b.
|
"[
***
]
DC Development Plan
" means the Development plan attached to this Amendment No. 5 as
Appendix
1,
which may be amended from time to time by the JSC
.
|
c.
|
"
[
***
]
DC"
means the Compound designated as the [***] DC under
Section 3.c.
of this Amendment No. 5.
|
d.
|
"[***] DC Selection Criteria"
has the meaning set forth in
Section 3.c
of this Amendment No. 5.
|
e.
|
[***]
|
f.
|
"[
***] Option Deadline
" has the meaning set forth in
Section 7
of this Amendment No. 5.
|
g.
|
"[
***] PoC Trial Completion Package
" has the meaning set forth in
Section 7
of this Amendment No. 5.
|
h.
|
"[
***] Program
" has the meaning set forth in the recitals of this Amendment No. 5.
|
i.
|
"[***]"
means the compound known as [***] (which is ISIS [***]).
|
j.
|
"Licensed [***] Product"
means a Licensed Product having the [***] DC as an active ingredient.
|
k.
|
"Prioritized Lead"
has the meaning set forth in
Section 3.b
of this Amendment No. 5.
|
l.
|
"Prioritized Lead Studies"
has the meaning set forth in
Section 3.c
of this Amendment No. 5.
|
m.
|
"Prioritized Lead Data Package"
has the meaning set forth in
Section 3.c
of this Amendment No. 5.
|
n.
|
"Research Leads
" has the meaning set forth in
Section 1
of this Amendment No. 5.
|
o.
|
"Research Lead Study
" has the meaning set forth in
Section 3.a.
of this Amendment No. 5.
|
p.
|
"Research Lead Data Package
" has the meaning set forth in
Section 3.b.
of this Amendment No. 5.
|
Dated: August 4, 2014
|
|
|
|
/s/ Stanley T. Crooke
|
|
|
|
Stanley T. Crooke, M.D., Ph.D.
|
|
Chief Executive Officer
|
|
Dated: August 4, 2014
|
|
|
|
/s/ Elizabeth L. Hougen
|
|
|
|
Elizabeth L. Hougen
|
|
Chief Financial Officer
|
|
1. | The Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2014, to which this Certification is attached as Exhibit 32.1 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and |
2. | The information contained in the Periodic Report fairly presents, in all material respects, the financial condition of the Company at the end of the period covered by the Periodic Report and the results of operations of the Company for the period covered by the Periodic Report. |
Dated: August 4, 2014
|
|
|
|
|
|
/s/ Stanley T. Crooke
|
|
/s/ Elizabeth L. Hougen
|
Stanley T. Crooke, M.D., Ph.D.
|
|
Elizabeth L. Hougen
|
Chief Executive Officer
|
|
Chief Financial Officer
|