Form 10-K
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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20-1450200
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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2130 W. Holcombe Blvd., Ste. 800, Houston, TX
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77030
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, par value $0.01 per share
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BLCM
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The Nasdaq Global Market
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
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¨
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Smaller reporting company
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x
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Emerging growth company
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¨
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Signatures
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the success, cost and timing of our product development activities and clinical trials;
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our ability to advance Chemical Induction of Dimerization, or CID, CID-based technologies, including CaspaCIDe and GoCAR-T;
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our ability to obtain and maintain regulatory approval of any of our product candidates, and any related restrictions, limitations and/or warnings in the label of an approved product candidate;
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our ability to obtain funding for our operations, including funding necessary to complete further development and commercialization of our product candidates;
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the commercialization of our product candidates, if approved;
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our plans to research, develop and commercialize our product candidates;
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our ability to attract collaborators with development, regulatory and commercialization expertise and the success of any such collaborations;
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future agreements with third parties in connection with the commercialization of our product candidates and any other approved product;
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the size and growth potential of the markets for our product candidates, and our ability to serve those markets;
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the rate and degree of market acceptance of our product candidates;
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regulatory developments in the United States, or U.S., and foreign countries;
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our ability to contract with third-party suppliers and manufacturers and their ability to perform adequately;
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the success of competing therapies that are or may become available;
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our ability to attract and retain key scientific or management personnel;
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our ability to grow our organization and increase the size of our facilities to meet our anticipated growth;
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the accuracy of our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;
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our use of cash and other resources; and
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our expectations regarding our ability to obtain and maintain intellectual property protection for our product candidates.
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The inducible MyD88/CD40 (iMC) activation switch that is incorporated into our GoCAR product candidates is designed to enhance CAR-based cell therapies by augmenting multiple mechanisms of action, including: 1) boosting effector cell proliferation; 2) enhancing functional persistence by resisting exhaustion and inhibitory signals found in the tumor microenvironment; and 3) stimulating the cancer patient’s own immune system to intensify tumor killing. Unlike other CAR therapies that can behave unpredictably due to their autonomous activity, GoCAR antitumor effects are controlled through scheduled administration of rimiducid. In the event of severe side effects, GoCAR activity can be attenuated by extending the interval between rimiducid doses or suspending further rimiducid administration.
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Our CaspaCIDe™ safety switch (also known as inducible Caspase-9, or iC9) is designed to be inactive unless the patient experiences a serious side effect (e.g., CRS or neurologic toxicities). In that event, rimiducid or temsirolimus is administered to induce Caspase-9 and eliminate the cells, with the goal of attenuating the therapy and resolving the serious side effect.
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Some of our product candidates are “dual-switch” GoCARs that are designed to provide a user-controlled system for managing proliferation, persistence and safety of tumor antigen-specific CAR cells by incorporating both our iMC and CaspaCIDe switches. We also have an active research effort to further develop and enhance these molecular switch approaches.
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BPX-601 is an autologous GoCAR-T product candidate containing our proprietary iMC activation switch, designed to treat solid tumors expressing prostate stem cell antigen, or PSCA. We believe iMC enhances T cell proliferation and persistence, enhances host immune activity, and modulates the tumor microenvironment to improve the potential to treat solid tumors compared to traditional CAR-T therapies. A Phase 1/2 clinical trial, called BP-012, in patients with pancreatic cancer expressing PSCA is ongoing.
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BPX-603 is an autologous dual-switch GoCAR-T product candidate containing both the iMC activation and CaspaCIDe safety switches. BPX-603 is our first controllable dual-switch GoCAR-T product candidate and is designed to target solid tumors that express the human epidermal growth factor receptor 2 antigen, or HER2. We are conducting additional pre-clinical studies to support its Investigational New Drug, or IND application.
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BCMA GoCAR-NK is our first off-the-shelf, allogeneic GoCAR program. The GoCAR-NK program targets B-cell maturation antigen (BCMA) which is expressed by multiple myeloma cells. We recently initiated formal pre-clinical development activities for this program.
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Rivo-cel (rivogenlecleucel, formerly known as BPX-501), is a product candidate containing our proprietary CaspaCIDe safety switch that is intended to improve outcomes of hematopoietic stem cell transplantation in the treatment of hematologic malignancies and inherited blood disorders. We are pursuing a strategic partner for rivo‑cel to assume future development and commercialization responsibilities. Concurrently, we have reduced and expect to continue to reduce our rivo-cel related activities.
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iMC: Signaling Molecules for Activation and Proliferation. iMC is also known as inducible MyD88 and CD40. Myeloid differentiation primary response 88, or MyD88, is a protein that has functions in cellular responses to stimuli such as stress, cytokines and bacteria or viruses. CD40 is a co-stimulatory protein found on antigen-presenting cells, such as dendritic cells and B cells and is required for their full activation. Activation of iMC in immune cells, such as T lymphocytes, provides inducible co-stimulation, leading to enhanced cell proliferation and survival. In addition,
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CaspaCIDe: Signaling Molecule for Apoptosis. CaspaCIDe is also known as inducible Caspase-9. Caspase-9 is the initiating enzyme in the apoptosis pathway. When activated, the dimerization of CaspaCIDe leads to rapid apoptosis of gene-modified T cells. Because CaspaCIDe is designed to be permanently integrated into our cellular therapies, the safety switch has the potential to be available for use long after the initial therapy is delivered. Moreover, preclinical animal studies demonstrate the ability to modulate the elimination of cells containing CaspaCIDe by different rimiducid doses and schedules (i.e., titrated elimination).
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Viral Vectors. We use gamma retrovirus to transduce our product candidates. We believe that gamma retrovirus is optimal for cell transduction given that it is an integrating vector that induces long-term gene expression, exhibits high transduction efficiency, has sufficient capacity for DNA content, and has been extensively and safely used in clinical trials.
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Genetically Modified Cells. We have designed and refined a proprietary process for cell engineering that has been improved from lab-based open procedures used in academic and research settings to a functionally closed system that is more appropriate for large-scale clinical trials and commercialization. Our systems are designed to be compliant with current guidelines and regulations for cell-based manufacturing in the U.S. and Europe and have been successfully implemented in our facility and transferred and implemented by our third-party manufacturers.
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Small Molecules. Rimiducid is a synthetic small molecule that has been rationally designed to trigger the proprietary switch proteins in our CID platform. We have separate third-party manufacturers for the active pharmaceutical ingredient, or API, and the finished drug product. Manufacturers of both the API and finished drug product are licensed to manufacture a variety of marketed drugs worldwide and have been selected based on their ability to provide supplies for our clinical trials and future commercialization. In our dual-switch constructs, the small molecule temsirolimus can be used to trigger one of the two switches. Temsirolimus is an approved and commercially available product manufactured and distributed by Pfizer Inc. under the trade name TORISEL.
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We have internally developed technology disclosed in four pending utility patent applications in the U.S., 1 European granted patent validated in 8 countries, 26 pending foreign patent applications, and two pending PCT application which relate to our GoCAR-T technology. If U.S. patents issue from the U.S. applications, the estimated expiration date of the last to expire patent is in 2037. If patents are issued in foreign jurisdictions, the anticipated expiration dates will be in 2037.
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Pursuant to our licenses from Baylor and Ariad, we have exclusive commercial rights to eleven issued U.S. patents expiring in 2024 or later, 6 pending U.S. utility patent applications, eleven issued foreign patents expiring in 2024 or later and 9 pending patent applications in foreign jurisdictions that relate to our GoCAR-T, GoCAR-NK, rivo-cel and certain of our other technologies. If U.S. patents issue from the currently pending U.S. patent applications, the estimated expiration date of the last to expire patent is 2031. If patents from the currently pending patent applications are issued in foreign jurisdictions, the estimated expiration dates range from 2024 to 2029.
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Pursuant to our license agreement with Agensys we have exclusive commercial rights for technology to target certain cancer-specific antigens.
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completion of nonclinical laboratory tests and animal studies according to good laboratory practices, or GLPs, and applicable requirements for the humane use of laboratory animals or other applicable regulations;
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submission to the FDA of an IND, which must become effective before human clinical trials may begin;
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performance of adequate and well-controlled human clinical trials according to the FDA’s regulations commonly referred to as good clinical practices, or GCPs, and any additional requirements for the protection of human research patients and their health information, to establish the safety and efficacy of the proposed biological product for its intended use;
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submission to the FDA of a BLA for marketing approval that includes substantial evidence of safety, purity, and potency from results of nonclinical testing and clinical trials;
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satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the biological product is produced to assess compliance with cGMP, to assure that the facilities, methods and controls are adequate to preserve the biological product’s identity, strength, quality and purity and, if applicable, the FDA’s current good tissue practices, or GTPs, for the use of HCT/Ps;
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potential FDA audit of the nonclinical study and clinical trial sites that generated the data in support of the BLA; and
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FDA review and approval, or licensure, of the BLA.
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Phase 1. The biological product is initially introduced into healthy human subjects and tested for safety. In the case of some products for severe or life-threatening diseases, especially when the product may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients.
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Phase 2. The biological product is evaluated in a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance, optimal dosage and dosing schedule.
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Phase 3. Clinical trials are undertaken to further evaluate dosage, clinical efficacy, potency, and safety in an expanded patient population at geographically dispersed clinical trial sites. These clinical trials are intended to establish the overall risk to benefit ratio of the product and provide an adequate basis for product labeling.
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seek collaborators for one or more of our current or future product candidates on terms that are less favorable than might otherwise be available;
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relinquish or license on unfavorable terms our rights to technologies or product candidates that we otherwise would seek to develop or commercialize ourselves; or
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seek a third party to acquire us or our assets.
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The FDA or comparable regulatory authority or an Institutional Review Board or comparable ethics oversight body may decline to clear the applicable Investigational New Drug Application (IND) or equivalent regulatory submission necessary to conduct human clinical trials;
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we may be unable to demonstrate to the satisfaction of the FDA or comparable foreign regulatory authorities that our product candidates have the necessary safety, purity, and potency for any of their proposed indications;
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the results of clinical trials may not meet the level of statistical significance required by the FDA or comparable foreign regulatory authorities for approval;
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we may be unable to demonstrate that our product candidates’ clinical and other benefits outweigh their safety risks;
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we may encounter serious and unexpected adverse events during clinical trials that render our products unsafe for use in humans;
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the FDA or comparable foreign regulatory authorities may disagree with our interpretation of data from preclinical studies or clinical trials;
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the data collected from clinical trials of our product candidates may not be sufficient to the satisfaction of the FDA or comparable foreign regulatory authorities to support the submission of a BLA or other comparable submission in foreign jurisdictions or to obtain regulatory approval in Europe, the U.S. or elsewhere;
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the FDA or comparable foreign regulatory authorities may fail to approve our manufacturing processes and/or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; and
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the approval policies or regulations of the FDA or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval.
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completing requisite clinical trials through all phases of clinical development of our current product candidates;
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seeking and obtaining marketing approvals for product candidates that successfully complete clinical trials, if any;
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launching and commercializing product candidates for which we obtain marketing approval, if any, with a partner or, if launched independently, successfully establishing a sales force, marketing and distribution infrastructure;
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identifying and developing new product candidates;
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progressing our pre-clinical programs into human clinical trials;
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establishing and maintaining supply and manufacturing relationships with third parties;
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developing new molecular switches based on our proprietary CID technology platform;
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maintaining, protecting, expanding and enforcing our intellectual property; and
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attracting, hiring and retaining qualified personnel.
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obtaining regulatory approval, as the FDA and other regulatory authorities have limited experience with commercial development of cell therapies for cancer;
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sourcing clinical and, if approved, commercial supplies for the materials used to manufacture and process our product candidates;
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developing a consistent and reliable process, while limiting contamination risks, for engineering and manufacturing T cells and other immune cell types ex vivo and infusing the engineered cells into the patient;
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educating medical personnel regarding the potential safety benefits, as well as the challenges, of incorporating our product candidates into their treatment regimens;
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establishing sales and marketing capabilities upon obtaining any regulatory approval to gain market acceptance of a novel therapy; and
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the availability of coverage and adequate reimbursement from third-party payors for our novel and personalized therapy.
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the patient eligibility criteria defined in the protocol;
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the size of the patient population required for analysis of the trial’s primary endpoints;
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the proximity of patients to study sites;
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the design of the clinical trial;
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our ability to recruit clinical trial investigators with the appropriate competencies and experience;
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our ability to obtain and maintain patient consents;
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the risk that patients enrolled in clinical trials will drop out of the clinical trials before completion; and
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competing clinical trials and approved therapies available for patients.
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We may be unable to identify manufacturers on acceptable terms or at all because the number of potential manufacturers is limited, and any replacement contractor must be approved by regulatory authorities. This approval would require new testing and compliance inspections. In addition, a new manufacturer would have to be educated in, or develop substantially equivalent processes for, production of our products after receipt of regulatory approval, if any.
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Our third-party manufacturers might be unable to timely formulate and manufacture our product or produce the quantity and quality required to meet our clinical and commercial needs, if any.
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Our future contract manufacturers may not perform as agreed or may not remain in the contract manufacturing business for the time required to supply our clinical trials or to successfully produce, store and distribute our products.
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Manufacturers are subject to ongoing periodic unannounced inspection by regulatory agencies to ensure strict compliance with cGMP and other government regulations and standards. We do not have control over third-party manufacturers’ compliance with these regulations and standards.
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We may not own, or may have to share, the intellectual property rights to any improvements made by our third-party manufacturers in the manufacturing process for our products.
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Our third-party manufacturers could breach or terminate their agreement with us.
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differing regulatory requirements in foreign countries;
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unexpected changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements;
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economic weakness, including inflation, or political instability in particular foreign economies and markets;
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compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;
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foreign taxes, including withholding of payroll taxes;
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foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations incident to doing business in another country;
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difficulties staffing and managing foreign operations;
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workforce uncertainty in countries where labor unrest is more common than in the U.S.;
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potential liability under the FCPA or comparable foreign regulations;
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challenges enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the U.S.;
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production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad;
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differing payor reimbursement regimes, governmental payors or patient self-pay systems and price controls; and
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business interruptions resulting from geo-political actions, including war and terrorism.
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the federal Anti-Kickback Statute, which prohibits, among other things, knowingly and willfully soliciting, receiving, offering or paying any remuneration (including any kickback, bribe, or rebate), directly or indirectly, overtly or covertly, in cash or in kind, to induce, or in return for, either the referral of an individual for, or the purchase, lease, order or recommendation of any good, facility, item or service for which payment may be made, in whole or in part, under a federal healthcare program, such as the Medicare and Medicaid programs;
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federal civil and criminal false claims laws and civil monetary penalties law, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment or approval from Medicare, Medicaid, or other third-party payors that are false or fraudulent or knowingly making a false statement to improperly avoid, decrease or conceal an obligation to pay money to the federal government;
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HIPAA, which created new federal criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters;
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HIPAA, as amended HITECH, and their respective implementing regulations, which impose requirements on certain covered healthcare providers, health plans, and healthcare clearinghouses as well as their respective business associates that perform services for them that involve the use, or disclosure of, individually identifiable health information, relating to the privacy, security and transmission of individually identifiable health information without appropriate authorization;
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the federal Physician Payments Sunshine Act, and its implementing regulations, which requires certain manufacturers of drugs, devices, biologicals and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the HHS, information related to payments or other transfers of value made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, as well as require certain manufacturers and group purchasing organizations to report annually ownership and investment interests held by such physicians and their immediate family members;
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federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; and
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foreign laws that govern the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and often are not preempted by or are in conflict with HIPAA, including the European Union General Data Protection Regulation, or the GDPR, which became effective on May 25, 2018, and which imposes privacy and security obligations on any entity that collects and/or processes health data from individuals located in the European Union. Under the GDPR, fines of up to 20 million euros or up to 4% of the annual global turnover of the infringer, whichever is greater, could be imposed for significant non-compliance. As well as complicating our compliance efforts, non-compliance with these laws could result in penalties or significant legal liability. The GDPR includes more stringent operational requirements for processors and controllers of personal data and creates additional rights for data subjects.
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decreased demand for our product candidates;
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injury to our reputation;
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withdrawal of clinical trial participants;
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initiation of investigations by regulators;
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costs to defend the related litigation;
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a diversion of management’s time and our resources;
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substantial monetary awards to clinical trial participants or patients;
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product recalls, withdrawals or labeling, marketing or promotional restrictions;
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loss of revenue;
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exhaustion of any available insurance and our capital resources;
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the inability to commercialize any product candidate; and
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a decline in our share price.
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the availability of financial resources to commence and complete our planned clinical trials;
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reaching agreement on acceptable terms with prospective clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different clinical trial sites;
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recruiting suitable patients to participate in a clinical trial;
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having patients complete a clinical trial or return for post-treatment follow-up;
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clinical trial sites deviating from clinical trial protocol, failing to follow GCPs, or dropping out of a clinical trial;
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adding new clinical trial sites; or
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manufacturing sufficient quantities of qualified materials under cGMPs and applying them on a subject by subject basis for use in clinical trials.
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restrictions on the marketing or manufacturing of our product candidates, withdrawal of the product from the market, or voluntary or mandatory product recalls;
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fines, warning letters or holds on clinical trials;
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refusal by the FDA to approve pending applications or supplements to approved applications filed by us or suspension or revocation of license approvals;
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suspension or termination of manufacturing at one or more manufacturing facilities;
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product seizure or detention, or refusal to permit the import or export of our product candidates; and
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injunctions or the imposition of civil or criminal penalties.
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the clinical indications for which our product candidates are approved;
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physicians, hospitals, cancer treatment centers and patients considering our product candidates as a safe and effective treatment;
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the potential and perceived advantages of our product candidates over alternative treatments;
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the prevalence and severity of any side effects;
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product labeling or product insert requirements of the FDA or other regulatory authorities;
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limitations or warnings contained in the labeling approved by the FDA or other regulatory authorities;
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the extent and quality of the clinical evidence supporting the efficacy and safety of our product candidates;
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the timing of market introduction of our product candidates as well as competitive products;
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the cost of treatment in relation to alternative treatments;
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the pricing of our product candidates and the availability of adequate reimbursement by third-party payors and government authorities;
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the willingness and ability of patients to pay out-of-pocket in the absence of coverage by third-party payors, including government authorities;
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relative convenience and ease of administration, including as compared to alternative treatments and competitive therapies;
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confusion or lack of understanding regarding the effects of rimiducid and the timing and size of dosing of rimiducid after immune cell therapy; and
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the effectiveness of our sales and marketing efforts.
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the scope of rights granted under the license agreement and other interpretation-related issues;
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whether and the extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement;
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our right to sublicense patent and other rights to third parties under collaborative development relationships;
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our diligence obligations with respect to the use of the licensed technology in relation to our development and commercialization of our product candidates, and what activities satisfy those diligence obligations; and
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the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and us and our partners.
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if and when patents will issue;
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the degree and range of protection any issued patents will afford us against competitors including whether third parties will find ways to invalidate or otherwise circumvent our patents;
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whether or not others will obtain patents claiming aspects similar to those covered by our patents and patent applications; or
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whether we will need to initiate litigation or administrative proceedings which may be costly whether we win or lose.
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the commencement, enrollment or results of the planned clinical trials of our product candidates or any future clinical trials we may conduct, or changes in the development status of our product candidates;
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any delay in our regulatory filings for our product candidates and any adverse development or perceived adverse development with respect to the applicable regulatory authority’s review of such filings, including without limitation the FDA’s issuance of a “refusal to file” letter or a request for additional information;
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adverse results or delays in our ongoing or future clinical trials;
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our decision to initiate a clinical trial, not to initiate a clinical trial or to terminate an existing clinical trial;
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adverse regulatory decisions, including failure to receive regulatory approval of our product candidates;
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changes in laws or regulations applicable to our products, including but not limited to clinical trial requirements for approvals;
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adverse developments concerning our CID technology platform and our small molecule drug rimiducid;
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adverse developments concerning our contract manufacturers;
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changes in the structure of healthcare payment systems;
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our inability to maintain successful collaborations or to establish new collaborations if needed;
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our failure to commercialize our product candidates;
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additions or departures of key scientific or management personnel;
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unanticipated serious safety concerns related to the use of our product candidates;
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introduction of new products or services offered by us or our competitors;
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announcements of significant acquisitions, strategic partnerships, joint ventures or capital commitments by us or our competitors;
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our ability to effectively manage our growth;
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the size and growth of our initial target markets;
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our ability to successfully treat additional types of diseases and cancers or at different stages;
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actual or anticipated variations in quarterly operating results;
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our cash position;
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our failure to meet the estimates and projections of the investment community or that we may otherwise provide to the public;
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publication of research reports about us or our industry, or immunotherapy in particular, or positive or negative recommendations or withdrawal of research coverage by securities analysts;
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changes in the market valuations of similar companies;
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overall performance of the equity markets;
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sales of our common stock by us or our stockholders in the future;
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trading volume of our common stock;
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changes in accounting practices;
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ineffectiveness of our internal controls;
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disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our technologies;
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significant lawsuits, including patent or stockholder litigation;
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general political and economic conditions; and
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other events or factors, many of which are beyond our control.
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the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that our independent registered public accounting firm provide an attestation report on the effectiveness of our internal control over financial reporting;
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the requirement to provide detailed compensation discussion and analysis in proxy statements and reports filed under the Exchange Act; and
|
•
|
the “say on pay” provisions (requiring a non-binding stockholder vote to approve compensation of certain executive officers) and the “say on golden parachute” provisions (requiring a non-binding stockholder vote to approve golden parachute arrangements for certain executive officers in connection with mergers and certain other business combinations) of the Dodd-Frank Act and some of the disclosure requirements of the Dodd-Frank Act relating to compensation of our chief executive officer.
|
•
|
a board of directors divided into three classes serving staggered three-year terms, such that not all members of the board will be elected at one time;
|
•
|
a prohibition on stockholder action through written consent, which requires that all stockholder actions be taken at a meeting of our stockholders;
|
•
|
a requirement that special meetings of stockholders be called only by the chairman of the board of directors, the chief executive officer, or by a majority of the total number of authorized directors;
|
•
|
advance notice requirements for stockholder proposals and nominations for election to our board of directors;
|
•
|
a requirement that no member of our board of directors may be removed from office by our stockholders except for cause and, in addition to any other vote required by law, upon the approval of not less than two-thirds of all outstanding shares of our voting stock then entitled to vote in the election of directors;
|
•
|
a requirement of approval of not less than two-thirds of all outstanding shares of our voting stock to amend any bylaws by stockholder action or to amend specific provisions of our certificate of incorporation; and
|
•
|
the authority of the board of directors to issue convertible preferred stock on terms determined by the board of directors without stockholder approval and which convertible preferred stock may include rights superior to the rights of the holders of common stock.
|
Location
|
|
Facilities
|
Houston, Texas
|
|
35,251 square feet for administrative and research and development activities
|
Houston, Texas
|
|
30,357 square feet for in-house cell therapy manufacturing activities
|
South San Francisco, California
|
|
13,943 square feet for office space
|
|
|
Year Ended
|
||||||
(in thousands, except per share data)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Statement of Operations:
|
|
|
|
|
||||
Revenues
|
|
$
|
7,143
|
|
|
$
|
1,120
|
|
Total operating expenses
|
|
94,507
|
|
|
96,586
|
|
||
Other expenses, net
|
|
25,113
|
|
|
2,570
|
|
||
Net loss
|
|
(112,477
|
)
|
|
(98,036
|
)
|
||
Net loss per share
|
|
|
|
|
||||
Basic and diluted
|
|
$
|
(24.01
|
)
|
|
$
|
(24.37
|
)
|
Balance Sheet Data:
|
|
|
|
|
||||
Total assets
|
|
$
|
116,250
|
|
|
$
|
121,501
|
|
Total debt, net
|
|
36,717
|
|
|
35,832
|
|
|
|
Year Ended
|
||||||||||
(in thousands)
|
|
December 31, 2019
|
|
December 31, 2018
|
|
Change
|
||||||
Revenues
|
|
$
|
7,143
|
|
|
$
|
1,120
|
|
|
$
|
6,023
|
|
Operating expenses:
|
|
|
|
|
|
|
||||||
Research and development
|
|
64,535
|
|
|
71,588
|
|
|
(7,053
|
)
|
|||
General and administrative
|
|
29,972
|
|
|
24,998
|
|
|
4,974
|
|
|||
Total operating expenses
|
|
94,507
|
|
|
96,586
|
|
|
(2,079
|
)
|
|||
Loss from operations
|
|
(87,364
|
)
|
|
(95,466
|
)
|
|
8,102
|
|
|||
Other income (expense):
|
|
|
|
|
|
|
||||||
Interest income
|
|
1,351
|
|
|
1,639
|
|
|
(288
|
)
|
|||
Interest expense
|
|
(4,280
|
)
|
|
(4,199
|
)
|
|
(81
|
)
|
|||
Change in fair value of warrant liability
|
|
(19,192
|
)
|
|
—
|
|
|
(19,192
|
)
|
|||
Other expense
|
|
(2,992
|
)
|
|
(10
|
)
|
|
(2,982
|
)
|
|||
Total other expense
|
|
(25,113
|
)
|
|
(2,570
|
)
|
|
(22,543
|
)
|
|||
Net loss
|
|
$
|
(112,477
|
)
|
|
$
|
(98,036
|
)
|
|
$
|
(14,441
|
)
|
|
|
Page
|
|
||
|
||
|
||
|
||
|
||
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
91,028
|
|
|
$
|
43,695
|
|
Restricted cash, current
|
|
2,788
|
|
|
—
|
|
||
Investment securities, available for sale
|
|
—
|
|
|
49,304
|
|
||
Accounts receivable, interest and other receivables
|
|
303
|
|
|
909
|
|
||
Prepaid expenses and other current assets
|
|
884
|
|
|
1,387
|
|
||
Assets held for sale
|
|
16,851
|
|
|
—
|
|
||
Total current assets
|
|
111,854
|
|
|
95,295
|
|
||
Operating lease right-of-use assets
|
|
1,042
|
|
|
—
|
|
||
Property and equipment, net
|
|
2,529
|
|
|
20,878
|
|
||
Restricted cash, noncurrent
|
|
—
|
|
|
4,973
|
|
||
Other assets
|
|
825
|
|
|
355
|
|
||
Total assets
|
|
$
|
116,250
|
|
|
$
|
121,501
|
|
LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS’ (DEFICIT) EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
2,643
|
|
|
$
|
3,774
|
|
Accrued expenses and other current liabilities
|
|
9,770
|
|
|
8,589
|
|
||
Warrant derivative liability
|
|
52,184
|
|
|
—
|
|
||
Private placement option liability
|
|
12,094
|
|
|
—
|
|
||
Current portion of long-term debt
|
|
11,000
|
|
|
—
|
|
||
Current portion of lease liabilities
|
|
454
|
|
|
40
|
|
||
Current portion of deferred revenue
|
|
—
|
|
|
2,983
|
|
||
Current portion of deferred rent
|
|
—
|
|
|
418
|
|
||
Liabilities held for sale
|
|
6,273
|
|
|
—
|
|
||
Total current liabilities
|
|
94,418
|
|
|
15,804
|
|
||
Long-term debt, net of deferred issuance costs
|
|
25,717
|
|
|
35,832
|
|
||
Long-term lease liabilities
|
|
864
|
|
|
91
|
|
||
Deferred rent
|
|
—
|
|
|
1,296
|
|
||
Total liabilities
|
|
120,999
|
|
|
53,023
|
|
||
Commitments and contingencies
|
|
|
|
|
|
|
||
Preferred stock: $0.01 par value; 10,000,000 shares authorized
|
|
|
|
|
||||
Series 1 redeemable convertible preferred stock, $0.01 par value, 1,517,500 shares authorized and 538,000 shares issued and outstanding at December 31, 2019
|
|
21,468
|
|
|
—
|
|
||
Stockholders’ (deficit) equity:
|
|
|
|
|
||||
Common stock, $0.01 par value; 40,000,000 shares authorized at December 31, 2019 and December 31, 2018, respectively; 5,076,593 shares issued and 5,008,846 shares outstanding at December 31, 2019; 4,424,205 shares issued and 4,356,459 shares outstanding at December 31, 2018
|
|
507
|
|
|
442
|
|
||
Treasury stock: 67,746 shares held at December 31, 2019 and December 31, 2018
|
|
(5,056
|
)
|
|
(5,056
|
)
|
||
Additional paid-in capital
|
|
511,684
|
|
|
493,784
|
|
||
Accumulated other comprehensive loss
|
|
(327
|
)
|
|
(144
|
)
|
||
Accumulated deficit
|
|
(533,025
|
)
|
|
(420,548
|
)
|
||
Total stockholders’ (deficit) equity
|
|
(26,217
|
)
|
|
68,478
|
|
||
Total liabilities, preferred stock and stockholders' (deficit) equity
|
|
$
|
116,250
|
|
|
$
|
121,501
|
|
|
|
Year Ended December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Revenues
|
|
|
|
|
||||
Grants
|
|
$
|
2,143
|
|
|
$
|
1,120
|
|
License fee revenue
|
|
5,000
|
|
|
—
|
|
||
Total revenues
|
|
7,143
|
|
|
1,120
|
|
||
Operating expenses
|
|
|
|
|
||||
Research and development
|
|
64,535
|
|
|
71,588
|
|
||
General and administrative
|
|
29,972
|
|
|
24,998
|
|
||
Total operating expenses
|
|
94,507
|
|
|
96,586
|
|
||
Loss from operations
|
|
(87,364
|
)
|
|
(95,466
|
)
|
||
Other income (expense):
|
|
|
|
|
||||
Interest income
|
|
1,351
|
|
|
1,639
|
|
||
Interest expense
|
|
(4,280
|
)
|
|
(4,199
|
)
|
||
Change in fair value of warrant liability
|
|
(19,192
|
)
|
|
—
|
|
||
Other expense
|
|
(2,992
|
)
|
|
(10
|
)
|
||
Total other expense
|
|
(25,113
|
)
|
|
(2,570
|
)
|
||
Net loss
|
|
$
|
(112,477
|
)
|
|
$
|
(98,036
|
)
|
|
|
|
|
|
||||
Net loss per common share attributable to common shareholders, basic and diluted
|
|
$
|
(24.01
|
)
|
|
$
|
(24.37
|
)
|
Weighted-average shares outstanding-basic and diluted
|
|
4,684,711
|
|
|
4,023,058
|
|
||
|
|
|
|
|
||||
Net loss
|
|
$
|
(112,477
|
)
|
|
$
|
(98,036
|
)
|
Other comprehensive loss:
|
|
|
|
|
||||
Unrealized gain on available-for-sale securities, net of tax
|
|
45
|
|
|
1
|
|
||
Foreign currency translation adjustment
|
|
(228
|
)
|
|
(99
|
)
|
||
Comprehensive loss
|
|
$
|
(112,660
|
)
|
|
$
|
(98,134
|
)
|
|
|
Series 1 Preferred
|
|
Common Stock
|
|
Treasury Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Total Stockholders' (Deficit) Equity
|
|||||||||||||||||||||||
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||||||||
Balance, December 31, 2017
|
|
—
|
|
|
—
|
|
|
3,396,264
|
|
|
$
|
340
|
|
|
(67,746
|
)
|
|
$
|
(5,056
|
)
|
|
411,922
|
|
|
(322,512
|
)
|
|
(46
|
)
|
|
84,648
|
|
|||||
Share-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,824
|
|
|
—
|
|
|
—
|
|
|
13,824
|
|
|||||||
Exercise of stock options
|
|
—
|
|
|
—
|
|
|
101,680
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
3,260
|
|
|
—
|
|
|
—
|
|
|
3,270
|
|
|||||||
Issuance of common stock - Employee Stock Purchase Plan
|
|
—
|
|
|
—
|
|
|
4,539
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
205
|
|
|
—
|
|
|
—
|
|
|
205
|
|
|||||||
Issuance of common stock in a public offering, net
|
|
—
|
|
|
—
|
|
|
920,000
|
|
|
92
|
|
|
—
|
|
|
—
|
|
|
64,573
|
|
|
—
|
|
|
—
|
|
|
64,665
|
|
|||||||
Issuance of common stock upon vesting of restricted stock units
|
|
—
|
|
|
—
|
|
|
1,722
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(98,036
|
)
|
|
(98
|
)
|
|
(98,134
|
)
|
|||||||
Balance, December 31, 2018
|
|
—
|
|
|
$
|
—
|
|
|
4,424,205
|
|
|
$
|
442
|
|
|
(67,746
|
)
|
|
$
|
(5,056
|
)
|
|
$
|
493,784
|
|
|
$
|
(420,548
|
)
|
|
$
|
(144
|
)
|
|
$
|
68,478
|
|
Share-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,338
|
|
|
—
|
|
|
—
|
|
|
7,338
|
|
|||||||
Exercise of stock options
|
|
—
|
|
|
—
|
|
|
2,985
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
76
|
|
|
—
|
|
|
—
|
|
|
76
|
|
|||||||
Issuance of common stock - Employee Stock Purchase Plan
|
|
—
|
|
|
—
|
|
|
8,000
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
97
|
|
|
—
|
|
|
—
|
|
|
98
|
|
|||||||
Issuance of common stock upon vesting of restricted stock units
|
|
—
|
|
|
—
|
|
|
12,287
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Issuance of common stock in open market transactions, net of issuance costs
|
|
—
|
|
|
—
|
|
|
259,116
|
|
|
26
|
|
|
—
|
|
|
—
|
|
|
8,951
|
|
|
—
|
|
|
—
|
|
|
8,977
|
|
|||||||
Issuance of redeemable convertible preferred stock in public offering, net
|
|
575,000
|
|
|
22,944
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Conversion of redeemable convertible preferred stock into common stock
|
|
(37,000
|
)
|
|
(1,476
|
)
|
|
370,000
|
|
|
37
|
|
|
—
|
|
|
—
|
|
|
1,439
|
|
|
—
|
|
|
—
|
|
|
1,476
|
|
|||||||
Comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(112,477
|
)
|
|
(183
|
)
|
|
(112,660
|
)
|
|||||||
Balance, December 31, 2019
|
|
538,000
|
|
|
$
|
21,468
|
|
|
5,076,593
|
|
|
$
|
507
|
|
|
(67,746
|
)
|
|
$
|
(5,056
|
)
|
|
$
|
511,684
|
|
|
$
|
(533,025
|
)
|
|
$
|
(327
|
)
|
|
$
|
(26,217
|
)
|
|
|
Year Ended December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net loss
|
|
$
|
(112,477
|
)
|
|
$
|
(98,036
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
||||
Share-based compensation
|
|
7,338
|
|
|
13,824
|
|
||
Depreciation and amortization expense
|
|
7,175
|
|
|
6,698
|
|
||
Change in fair value of warrant derivative liability
|
|
19,192
|
|
|
—
|
|
||
Impairment of intangible assets
|
|
2,064
|
|
|
—
|
|
||
Amortization of (discount) premium on investment securities, net
|
|
(30
|
)
|
|
94
|
|
||
Amortization of right-of-use assets
|
|
1,331
|
|
|
—
|
|
||
Accretion of lease liability
|
|
804
|
|
|
(276
|
)
|
||
Amortization of deferred issuance costs
|
|
885
|
|
|
886
|
|
||
Loss on disposition of fixed assets
|
|
6
|
|
|
10
|
|
||
Warrant and private placement option issuance costs
|
|
3,047
|
|
|
—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts receivable, interest and other receivables
|
|
606
|
|
|
(589
|
)
|
||
Prepaid expenses and other assets
|
|
(1,096
|
)
|
|
1,070
|
|
||
Accounts payable
|
|
(1,131
|
)
|
|
460
|
|
||
Accrued liabilities and other
|
|
(2,300
|
)
|
|
2,197
|
|
||
Deferred revenue
|
|
(2,983
|
)
|
|
(1,120
|
)
|
||
Net cash used in operating activities
|
|
(77,569
|
)
|
|
(74,782
|
)
|
||
Cash flows from investing activities:
|
|
|
|
|
||||
Purchases of investment securities
|
|
—
|
|
|
(59,335
|
)
|
||
Proceeds from sale of investment securities
|
|
49,379
|
|
|
71,362
|
|
||
Purchases of property and equipment
|
|
(522
|
)
|
|
(1,617
|
)
|
||
Cash provided by investing activities
|
|
48,857
|
|
|
10,410
|
|
||
Cash flows from financing activities:
|
|
|
|
|
||||
Proceeds from issuance of common stock in a public offering, net
|
|
8,977
|
|
|
64,860
|
|
||
Proceeds from issuance of redeemable convertible preferred stock in a public offering, net
|
|
22,944
|
|
|
—
|
|
||
Proceeds from issuance of warrants in a public offering, net
|
|
30,888
|
|
|
—
|
|
||
Proceeds received from private placement option, net
|
|
11,152
|
|
|
—
|
|
||
Proceeds from exercise of stock options
|
|
76
|
|
|
3,270
|
|
||
Proceeds from issuance of stock from employee stock purchase plan
|
|
98
|
|
|
205
|
|
||
Payment on financing lease obligations
|
|
(47
|
)
|
|
(31
|
)
|
||
Payment of issuance costs on common stock
|
|
—
|
|
|
(195
|
)
|
||
Net cash provided by financing activities
|
|
74,088
|
|
|
68,109
|
|
||
Effect of exchange rate changes on cash
|
|
(228
|
)
|
|
(98
|
)
|
||
Net change in cash, cash equivalents and restricted cash
|
|
45,148
|
|
|
3,639
|
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
|
48,668
|
|
|
45,029
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
93,816
|
|
|
$
|
48,668
|
|
Supplemental cash flow information:
|
|
|
|
|
||||
Cash paid during the period for interest
|
|
$
|
3,201
|
|
|
$
|
3,025
|
|
Non-cash investing and financing activities:
|
|
|
|
|
||||
Purchases of property and equipment in accounts payables and accrued liabilities
|
|
$
|
—
|
|
|
$
|
27
|
|
Financing leases incurred for equipment
|
|
$
|
167
|
|
|
$
|
—
|
|
Conversion of redeemable preferred stock into common stock
|
|
$
|
1,476
|
|
|
$
|
—
|
|
Reclassification of property and equipment, net to assets held for sale
|
|
$
|
12,039
|
|
|
$
|
—
|
|
(in thousands)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Cash and cash equivalents
|
|
$
|
91,028
|
|
|
$
|
43,695
|
|
Restricted cash, current
|
|
2,788
|
|
|
—
|
|
||
Restricted cash, noncurrent
|
|
—
|
|
|
4,973
|
|
||
Total cash, cash equivalents and restricted cash shown in the statements of cash flows
|
|
$
|
93,816
|
|
|
$
|
48,668
|
|
(in thousands, except useful lives)
|
|
Estimated Useful Lives
|
|
December 31, 2019
|
|
December 31, 2018
|
|||||||
Leasehold improvements
|
|
|
|
5
|
Years
|
|
$
|
3,944
|
|
|
$
|
21,633
|
|
Lab equipment
|
|
|
|
5
|
Years
|
|
5,459
|
|
|
8,471
|
|
||
Office furniture
|
|
|
|
5
|
Years
|
|
392
|
|
|
1,704
|
|
||
Manufacturing equipment
|
|
|
|
5
|
Years
|
|
395
|
|
|
1,890
|
|
||
Computer and office equipment
|
|
3
|
to
|
5
|
Years
|
|
1,595
|
|
|
1,606
|
|
||
Equipment held under capital leases
|
|
|
|
5
|
Years
|
|
270
|
|
|
204
|
|
||
Software
|
|
|
|
3
|
Years
|
|
385
|
|
|
361
|
|
||
Total
|
|
|
|
|
|
|
12,440
|
|
|
35,869
|
|
||
Less: accumulated depreciation
|
|
|
|
|
|
|
(9,911
|
)
|
|
(14,991
|
)
|
||
Property and equipment, net
|
|
|
|
|
|
|
$
|
2,529
|
|
|
$
|
20,878
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Accrued payroll
|
|
$
|
2,032
|
|
|
$
|
3,430
|
|
Accrued patient treatment costs
|
|
1,162
|
|
|
2,053
|
|
||
Accrued manufacturing costs
|
|
2,230
|
|
|
546
|
|
||
Accrued professional services
|
|
654
|
|
|
235
|
|
||
Accrued obligations under material supply agreements
|
|
1,121
|
|
|
—
|
|
||
Accrued construction costs
|
|
—
|
|
|
457
|
|
||
Accrued other
|
|
2,571
|
|
|
1,868
|
|
||
Total accrued expenses and other current liabilities
|
|
$
|
9,770
|
|
|
$
|
8,589
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
|
Common stock equivalents:
|
|
Number of Shares
|
|||
Redeemable convertible series 1 preferred stock
|
|
5,380,000
|
|
—
|
|
Warrants to purchase common stock
|
|
5,750,000
|
|
—
|
|
Options to purchase common stock
|
|
567,842
|
|
575,924
|
|
Unvested shares of restricted stock units
|
|
6,359
|
|
24,615
|
|
Total common stock equivalents
|
|
11,704,201
|
|
600,539
|
|
|
Fair Value at December 31, 2019
|
|
Fair Value at December 31, 2018
|
||||||||||||||||||||
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||
Cash Equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Money market funds and treasury bills
|
$
|
77,170
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,953
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Cash Equivalents
|
$
|
77,170
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,953
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government agency-backed securities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,383
|
|
|
$
|
—
|
|
Corporate debt securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41,921
|
|
|
—
|
|
||||||
Total Investment Securities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
49,304
|
|
|
$
|
—
|
|
(in thousands)
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Aggregate Estimated Fair Value
|
||||||||
December 31, 2018
|
|
|
|
|
|
|
|
|
||||||||
U.S. government agency-backed securities
|
|
$
|
7,382
|
|
|
$
|
2
|
|
|
$
|
(1
|
)
|
|
$
|
7,383
|
|
Corporate debt securities
|
|
41,968
|
|
|
—
|
|
|
(47
|
)
|
|
41,921
|
|
||||
Total
|
|
$
|
49,350
|
|
|
$
|
2
|
|
|
$
|
(48
|
)
|
|
$
|
49,304
|
|
|
|
December 31, 2019
|
|
September 30, 2019
|
|
August 21, 2019
|
|||
Risk-free interest rate
|
|
1.83
|
%
|
|
1.62
|
%
|
|
1.54
|
%
|
Volatility
|
|
78.67
|
%
|
|
70.89
|
%
|
|
69.72
|
%
|
Expected life (years)
|
|
6.64
|
|
|
6.89
|
|
|
7.00
|
|
|
Fair Value at December 31, 2019
|
||||||||||
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
Warrant derivative liability
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
52,184
|
|
Private placement option liability
|
—
|
|
|
—
|
|
|
12,094
|
|
|||
Total fair value
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
64,278
|
|
(in thousands)
|
|
Warrant Derivative Liability
|
|
Private Placement Option Liability
|
|
Total
|
||||||
Balance, December 31, 2018
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Issuance of warrants
|
|
32,992
|
|
|
—
|
|
|
32,992
|
|
|||
Private placement option liability
|
|
—
|
|
|
12,094
|
|
|
12,094
|
|
|||
Change in fair value
|
|
19,192
|
|
|
—
|
|
|
19,192
|
|
|||
Balance, December 31, 2019
|
|
$
|
52,184
|
|
|
$
|
12,094
|
|
|
$
|
64,278
|
|
(in thousands)
|
|
Year Ended December 31, 2019
|
||
Finance lease cost:
|
|
|
||
Amortization of leased assets
|
|
$
|
61
|
|
Interest on lease liabilities
|
|
25
|
|
|
Operating lease cost
|
|
2,135
|
|
|
Short-term lease cost
|
|
296
|
|
|
Total lease cost
|
|
$
|
2,517
|
|
|
|
|
||
Weighted-average remaining lease term:
|
|
|
||
Operating leases
|
|
5.2 years
|
|
|
Finance leases
|
|
2.4 years
|
|
|
Weighted-average discount rate:
|
|
|
||
Operating leases
|
|
12.1
|
%
|
|
Finance leases
|
|
13.4
|
%
|
(in thousands)
|
|
Year Ended December 31, 2019
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
||
Operating cash flows from operating leases
|
|
$
|
2,378
|
|
Operating cash flows from finance leases
|
|
25
|
|
|
Financing cash flows from finance leases
|
|
47
|
|
|
Non-cash activity:
|
|
|
||
Right-of-use assets obtained in exchange for lease obligations
|
|
$
|
2,263
|
|
(in thousands)
|
|
Operating Leases
|
|
Financing Leases
|
||||
2020
|
|
$
|
2,663
|
|
|
$
|
96
|
|
2021
|
|
1,673
|
|
|
90
|
|
||
2022
|
|
1,418
|
|
|
39
|
|
||
2023
|
|
1,143
|
|
|
—
|
|
||
2024
|
|
1,185
|
|
|
—
|
|
||
2025 and beyond
|
|
2,065
|
|
|
—
|
|
||
Total lease payments
|
|
10,147
|
|
|
225
|
|
||
Less: Imputed interest
|
|
(2,748
|
)
|
|
(33
|
)
|
||
Present value of lease liabilities
|
|
$
|
7,399
|
|
|
$
|
192
|
|
Year
|
|
Operating Leases
|
|
Capital Leases
|
||||
2019
|
|
$
|
2,087
|
|
|
$
|
68
|
|
2020
|
|
1,112
|
|
|
68
|
|
||
2021
|
|
1,055
|
|
|
43
|
|
||
2022
|
|
1,094
|
|
|
—
|
|
||
2023
|
|
1,133
|
|
|
—
|
|
||
Thereafter
|
|
3,222
|
|
|
—
|
|
||
Total minimum rentals
|
|
$
|
9,703
|
|
|
$
|
179
|
|
(in thousands)
|
|
Payments
|
||
Year 2020
|
|
$
|
11,000
|
|
Year 2021
|
|
12,000
|
|
|
Year 2022
|
|
15,045
|
|
|
Total debt
|
|
$
|
38,045
|
|
Less deferred issuance costs
|
|
(1,328
|
)
|
|
Less current portion
|
|
(11,000
|
)
|
|
Total long-term debt
|
|
$
|
25,717
|
|
(in thousands)
|
|
Warrant Derivative Liability
|
||
Fair value of Series 1 warrants at the date of issuance, August 21, 2019
|
|
$
|
32,992
|
|
Change in fair value
|
|
19,192
|
|
|
Fair value at December 31, 2019
|
|
$
|
52,184
|
|
•
|
With respect to the Series 1 Preferred Stock, the first date following August 21, 2021, on which each of the Conditions (as defined below) is met (the “Series 1 Transition Date”);
|
•
|
With respect to the Series 2 Preferred Stock, the first date following the six-month anniversary of the Series 1 Transition Date on which each of the Conditions is met (the “Series 2 Transition Date”); and
|
•
|
With respect to the Series 3 Preferred Stock, the first date following the six-month anniversary of the Series 2 Transition Date on which each of the Conditions is met.
|
|
December 31, 2019
|
|
December 31, 2018
|
||
Options
|
471,282
|
|
|
401,535
|
|
Inducement option awards
|
96,560
|
|
|
122,500
|
|
Restricted stock units
|
5,609
|
|
|
19,490
|
|
Inducement restricted stock units outstanding
|
750
|
|
|
5,125
|
|
Total outstanding awards
|
574,201
|
|
|
548,650
|
|
|
|
Year Ended
|
||||
|
|
December 31, 2019
|
|
December 31, 2018
|
||
Options granted
|
|
276,830
|
|
|
262,319
|
|
Weighted-average exercise price
|
|
26.12
|
|
|
68.79
|
|
Weighted-average grant date fair value
|
|
16.99
|
|
|
45.10
|
|
Assumptions:
|
|
|
|
|
||
Risk-free interest rate
|
|
2.23
|
%
|
|
2.67
|
%
|
Volatility
|
|
72
|
%
|
|
72
|
%
|
Expected life (years)
|
|
6.04
|
|
|
6.08
|
|
Expected dividend yield
|
|
—
|
%
|
|
—
|
%
|
Options
|
|
Outstanding Stock Options
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Term (in years)
|
|
Aggregate Intrinsic Value
(in thousands)
|
|||||
Balance at December 31, 2017
|
|
528,647
|
|
|
$
|
123.51
|
|
|
7.35
|
|
$
|
7,223
|
|
Granted
|
|
262,319
|
|
|
$
|
68.79
|
|
|
|
|
|
||
Exercised
|
|
(104,445
|
)
|
|
$
|
31.99
|
|
|
|
|
|
||
Forfeited
|
|
(110,597
|
)
|
|
$
|
155.64
|
|
|
|
|
|
||
Balance at December 31, 2018
|
|
575,924
|
|
|
$
|
109.01
|
|
|
8.09
|
|
$
|
87
|
|
Granted
|
|
276,830
|
|
|
$
|
26.12
|
|
|
|
|
|
||
Exercised
|
|
(220
|
)
|
|
$
|
25.50
|
|
|
|
|
|
||
Forfeited
|
|
(284,692
|
)
|
|
$
|
93.81
|
|
|
|
|
|
||
Balance at December 31, 2019
|
|
567,842
|
|
|
$
|
76.25
|
|
|
7.82
|
|
$
|
12
|
|
Exercisable at December 31, 2019
|
|
271,356
|
|
|
$
|
109.26
|
|
|
6.66
|
|
$
|
5
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||||
Exercise Price
|
|
Total Shares
|
|
Weighted Average Remaining Contractual Term
(in years)
|
|
Weighted Average Exercise Price
|
|
Total Shares
|
|
Weighted Average Remaining Contractual Term
(in years)
|
|
Weighted Average Exercise Price
|
||||||
$5.10 to $27.99
|
|
116,935
|
|
|
8.23
|
|
$
|
19.72
|
|
|
19,560
|
|
|
2.12
|
|
$
|
24.78
|
|
$28.00 to $34.59
|
|
114,298
|
|
|
9.05
|
|
$
|
33.66
|
|
|
12,550
|
|
|
8.97
|
|
$
|
33.91
|
|
$34.60 to $78.49
|
|
112,977
|
|
|
7.78
|
|
$
|
68.77
|
|
|
68,586
|
|
|
7.22
|
|
$
|
70.77
|
|
$78.50 to $117.99
|
|
91,960
|
|
|
7.84
|
|
$
|
96.55
|
|
|
57,690
|
|
|
7.72
|
|
$
|
99.18
|
|
$118.00 to $234.70
|
|
131,672
|
|
|
6.42
|
|
$
|
155.68
|
|
|
112,970
|
|
|
6.32
|
|
$
|
160.77
|
|
Total
|
|
567,842
|
|
|
7.82
|
|
$
|
76.25
|
|
|
271,356
|
|
|
6.66
|
|
$
|
109.26
|
|
Awards
|
|
Outstanding Restricted Stock Awards and Units
|
|
Weighted-Average Grant Date Fair Value Per Share
|
|
Outstanding Aggregate Intrinsic Value (in thousands)
|
|
Total Fair Value of Restricted Awards Vested (in thousands)
|
|||||||
Balance at December 31, 2017
|
|
14,066
|
|
|
$
|
138.69
|
|
|
$
|
1,183
|
|
|
|
||
Granted
|
|
21,125
|
|
|
$
|
71.36
|
|
|
|
|
|
||||
Vested
|
|
(5,723
|
)
|
|
$
|
158.47
|
|
|
$
|
420
|
|
|
$
|
907
|
|
Forfeited
|
|
(4,853
|
)
|
|
$
|
118.85
|
|
|
|
|
|
||||
Balance at December 31, 2018
|
|
24,615
|
|
|
$
|
80.23
|
|
|
$
|
719
|
|
|
|
||
Granted
|
|
3,000
|
|
|
$
|
33.30
|
|
|
|
|
|
||||
Vested
|
|
(14,478
|
)
|
|
$
|
64.16
|
|
|
$
|
240
|
|
|
$
|
929
|
|
Forfeited
|
|
(6,778
|
)
|
|
$
|
82.44
|
|
|
|
|
|
||||
Balance at December 31, 2019
|
|
6,359
|
|
|
$
|
92.29
|
|
|
$
|
82
|
|
|
|
|
|
Year Ended
|
||||||
(in thousands except share data)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Deductions from employees
|
|
$
|
70
|
|
|
$
|
221
|
|
Share-based compensation expense recognized
|
|
$
|
95
|
|
|
$
|
138
|
|
Remaining share-based compensation expense
|
|
$
|
206
|
|
|
$
|
464
|
|
Proceeds received by the Company for ESPP
|
|
$
|
98
|
|
|
$
|
205
|
|
Weighted-average purchase price per common share
|
|
$
|
12.25
|
|
|
$
|
45.30
|
|
Number of shares purchased by employees under ESPP
|
|
8,000
|
|
|
4,539
|
|
|
|
Year Ended
|
||||||
(in thousands)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
General and administrative
|
|
$
|
4,017
|
|
|
$
|
7,479
|
|
Research and development
|
|
3,321
|
|
|
6,345
|
|
||
Total
|
|
$
|
7,338
|
|
|
$
|
13,824
|
|
(in thousands)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Tax benefit at statutory rate
|
|
$
|
(23,591
|
)
|
|
$
|
(20,608
|
)
|
Other
|
|
(294
|
)
|
|
128
|
|
||
Stock based compensation
|
|
2,674
|
|
|
2,213
|
|
||
Issuance costs on warrants, private placement option, and preferred stock
|
|
4,657
|
|
|
—
|
|
||
Deferred tax valuation allowances
|
|
19,542
|
|
|
21,606
|
|
||
Research and development credit
|
|
(2,988
|
)
|
|
(3,339
|
)
|
||
Income tax expense
|
|
$
|
—
|
|
|
$
|
—
|
|
(in thousands)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Deferred tax assets (liabilities):
|
|
|
|
|
||||
Federal net operating loss carryforward
|
|
$
|
81,960
|
|
|
$
|
63,624
|
|
Stock compensation
|
|
3,270
|
|
|
4,533
|
|
||
Intangible assets
|
|
8,077
|
|
|
8,392
|
|
||
Research and development credit
|
|
16,601
|
|
|
13,612
|
|
||
Operating lease right-of-use assets
|
|
(1,229
|
)
|
|
—
|
|
||
Lease liabilities
|
|
1,538
|
|
|
—
|
|
||
Other
|
|
2,336
|
|
|
2,858
|
|
||
Total deferred tax assets, net of deferred tax liabilities
|
|
112,553
|
|
|
93,019
|
|
||
Valuation allowance
|
|
(112,553
|
)
|
|
(93,019
|
)
|
||
Net deferred tax assets
|
|
$
|
—
|
|
|
$
|
—
|
|
(in thousands)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
U.S. federal income tax net operating loss carryforwards
|
|
$
|
390,286
|
|
|
$
|
302,971
|
|
U.K. net operating loss carryforwards
|
|
$
|
—
|
|
|
$
|
2,424
|
|
U.S. federal research tax credits
|
|
$
|
11,348
|
|
|
$
|
8,939
|
|
Texas research tax credits
|
|
$
|
5,252
|
|
|
$
|
4,673
|
|
(unaudited; in thousands except per share data)
|
|
|
||||||||||||||
2019
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
Total revenues
|
|
$
|
516
|
|
|
$
|
1,391
|
|
|
$
|
103
|
|
|
$
|
5,133
|
|
Loss from operations
|
|
$
|
(23,868
|
)
|
|
$
|
(26,159
|
)
|
|
$
|
(23,437
|
)
|
|
$
|
(13,900
|
)
|
Net loss
|
|
$
|
(24,528
|
)
|
|
$
|
(26,936
|
)
|
|
$
|
(32,032
|
)
|
|
$
|
(28,981
|
)
|
Net loss per share attributable to common shareholders - basic and diluted
|
|
$
|
(5.54
|
)
|
|
$
|
(5.85
|
)
|
|
$
|
(6.79
|
)
|
|
$
|
(5.82
|
)
|
|
||||||||||||||||
2018
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
Total revenues
|
|
$
|
154
|
|
|
$
|
362
|
|
|
$
|
292
|
|
|
$
|
312
|
|
Loss from operations
|
|
$
|
(22,104
|
)
|
|
$
|
(23,567
|
)
|
|
$
|
(23,228
|
)
|
|
$
|
(26,567
|
)
|
Net loss
|
|
$
|
(22,840
|
)
|
|
$
|
(24,175
|
)
|
|
$
|
(23,801
|
)
|
|
$
|
(27,220
|
)
|
Net loss per share attributable to common shareholders - basic and diluted
|
|
$
|
(6.83
|
)
|
|
$
|
(5.95
|
)
|
|
$
|
(5.49
|
)
|
|
$
|
(6.27
|
)
|
Exhibit
Number |
|
Description
|
||
|
|
|
||
3.1
|
|
|||
|
|
|||
3.2
|
|
|||
|
|
|
||
3.3
|
|
|||
|
|
|||
4.1
|
|
|||
|
|
|||
4.2
|
|
|||
|
|
|||
4.3
|
|
|||
|
|
|||
4.4
|
|
|||
|
|
|
||
4.5
|
|
|||
|
|
|
||
4.6
|
|
|||
|
|
|
||
4.7
|
|
|||
|
|
|
||
4.8
|
|
|||
|
|
|
||
10.1+
|
|
|||
|
|
|||
10.2+
|
|
|||
|
|
|||
10.3+
|
|
|||
|
|
Exhibit
Number |
|
Description
|
||
10.4(A)+
|
|
|||
|
|
|||
10.4(B)+
|
|
|||
|
|
|||
10.4(C)+
|
|
|||
|
|
|||
10.4(D)+
|
|
|||
|
|
|||
10.4(E)+
|
|
|||
|
|
|||
10.4(F)+
|
|
|||
|
|
|||
10.4(G)+
|
|
|||
|
|
|
||
10.5(A)+
|
|
|||
|
|
|
||
10.5(B)+
|
|
|||
|
|
|||
10.6+
|
|
|||
|
|
|||
10.7+
|
|
|||
|
|
|||
10.8+
|
|
|||
|
|
|||
10.9+
|
|
|||
|
|
|||
10.10+
|
|
|||
|
|
|||
10.11+
|
|
|||
|
|
|
||
10.12+
|
|
|||
|
|
|||
10.13+
|
|
|||
|
|
|||
10.14+
|
|
|||
|
|
|||
10.15
|
|
|||
|
|
|||
10.16*
|
|
|||
|
|
Exhibit
Number |
|
Description
|
||
10.17*
|
|
|||
|
|
|||
10.18*
|
|
|||
|
|
|
||
10.19*
|
|
|||
|
|
|
||
10.20*
|
|
|||
|
|
|
||
10.21*
|
|
|||
|
|
|
||
10.22*
|
|
|||
|
|
|
||
10.23*
|
|
|||
|
|
|
||
10.24*
|
|
|||
|
|
|
||
10.25
|
|
|||
|
|
|
||
10.26
|
|
|||
|
|
|
||
10.27
|
|
|||
|
|
|
||
10.28
|
|
|||
|
|
|
||
10.29
|
|
|||
|
|
|
||
10.30
|
|
|||
|
|
|
||
10.31
|
|
|||
|
|
|
||
10.32
|
|
|||
|
|
|||
10.33
|
|
|||
|
|
Exhibit
Number |
|
Description
|
||
10.34
|
|
|||
|
|
|
||
10.35*
|
|
|||
|
|
|
||
10.36
|
|
|||
|
|
|
||
10.37*
|
|
|||
|
|
|
||
10.38*
|
|
|||
|
|
|
||
10.39
|
|
|||
|
|
|
||
21.1
|
|
|||
|
|
|
||
23.1
|
|
|||
|
|
|
||
24.1
|
|
|||
|
|
|
||
31.1
|
|
|||
|
|
|
||
31.2
|
|
|||
|
|
|||
32.1#
|
|
|||
|
|
|||
32.2#
|
|
|||
|
|
|
||
101.INS**
|
|
XBRL Instance
|
||
|
|
|
||
101.SCH**
|
|
XBRL Taxonomy Extension Schema
|
||
|
|
|
||
101.CAL**
|
|
XBRL Taxonomy Extension Calculation
|
||
|
|
|
||
101.DEF**
|
|
XBRL Taxonomy Extension Definition
|
||
|
|
|
||
101.LAB**
|
|
XBRL Taxonomy Extension Labels
|
||
|
|
|
||
101.PRE**
|
|
XBRL Taxonomy Extension Presentation
|
|
+
|
|
Indicates management contract or compensatory plan.
|
|
|
|
*
|
|
Certain portions of this exhibit (indicated by “[***]”) have been omitted as the Registrant as determined (i) the omitted information is not material and (ii) the omitted information would likely cause harm to the Registrant if publicly disclosed.
|
|
|
|
#
|
|
This certification is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
|
|
|
|
|
Bellicum Pharmaceuticals, Inc.
|
|
|
|
|
Date: March 12, 2020
|
By:
|
/s/ Richard A. Fair
|
|
|
Richard A. Fair
President and Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Richard A. Fair
|
|
President, Chief Executive Officer and Director
|
|
March 12, 2020
|
Richard A. Fair
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ Atabak Mokari
|
|
Chief Financial Officer
|
|
March 12, 2020
|
Atabak Mokari
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
/s/ David E. Strauss
|
|
Corporate Controller
|
|
March 12, 2020
|
David E. Strauss
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/ James Brown
|
|
Chairman of the Board of Directors
|
|
March 12, 2020
|
James Brown
|
|
|
|
|
|
|
|
|
|
/s/ James M. Daly
|
|
Member of the Board of Directors
|
|
March 12, 2020
|
James M. Daly
|
|
|
|
|
|
|
|
|
|
/s/ Stephen R. Davis
|
|
Member of the Board of Directors
|
|
March 12, 2020
|
Stephen R. Davis
|
|
|
|
|
|
|
|
|
|
/s/ Reid M. Huber, Ph.D.
|
|
Member of the Board of Directors
|
|
March 12, 2020
|
Reid M. Huber, Ph.D.
|
|
|
|
|
|
|
|
|
|
/s/ Judith Klimovsky
|
|
Member of the Board of Directors
|
|
March 12, 2020
|
Judith Klimovsky
|
|
|
|
|
|
|
|
|
|
/s/ Jon P. Stonehouse
|
|
Member of the Board of Directors
|
|
March 12, 2020
|
Jon P. Stonehouse
|
|
|
|
|
|
BELLICUM PHARMACEUTICALS, INC.
|
|
/S/ THOMAS J. FARRELL
|
THOMAS J. FARRELL
|
Chief Executive Officer
|
|
||
|
|
|
|
|
|
Bellicum Pharmaceuticals, Inc.
|
|
|
|
|
|
By:
|
/s/ Richard Fair
|
|
|
Name: Richard Fair
Title: Chief Executive Officer
|
|
•
|
prior to such time, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
|
•
|
upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock owned by the interested stockholder) those shares owned (1) by persons who are directors and also officers and (2) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
|
•
|
at or subsequent to such time, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66-2/3% of the outstanding voting stock which is not owned by the interested stockholder.
|
•
|
any merger or consolidation involving the corporation and the interested stockholder;
|
•
|
any sale, transfer, pledge or other disposition involving the interested stockholder of 10% or more of the assets of the corporation;
|
•
|
subject to exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;
|
•
|
subject to exceptions, any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; and
|
•
|
the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.
|
•
|
permit our board of directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate;
|
•
|
provide that the authorized number of directors may be changed only by resolution adopted by a majority of the board of directors;
|
•
|
provide that the board of directors or any individual director may only be removed with cause and the affirmative vote of the holders of at least 66 2/3% of the voting power of all of our then outstanding common stock, subject to the rights of any series of preferred stock that may be designated from time to time to elect additional directors under specified circumstances;
|
•
|
provide that all vacancies, including newly created directorships, may, except as otherwise required by law or subject to the rights of holders of preferred stock as designated from time to time, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum;
|
•
|
divide our board of directors into three classes;
|
•
|
require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders and not be taken by written consent or electronic transmission;
|
•
|
provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner and also specify requirements as to the form and content of a stockholder’s notice;
|
•
|
do not provide for cumulative voting rights (therefore allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election, if they should so choose); and
|
•
|
provide that special meetings of our stockholders may be called only by the chairman of the board, our Chief Executive Officer or by the board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors (whether or not there exists any vacancies).
|
•
|
provide that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (1) any derivative action or proceeding brought on our behalf, (2) any action asserting a claim of breach of a fiduciary duty owed by any of our directors or officers to us or our stockholders, (3) any action asserting a claim against the us arising pursuant to any provision of the DGCL or our certificate of incorporation or bylaws, or (4) any action asserting a claim against us governed by the internal affairs doctrine. The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation and bylaws has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable. This choice of forum provision does not apply to suits brought to enforce a duty or liability created by the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts have exclusive jurisdiction.
|
a.
|
All Eligible Directors: $40,000
|
b.
|
Chairman of the Board Service Retainer (in addition to Eligible Director Service Retainer): $30,000
|
c.
|
Lead Independent Director Service Retainer (in addition to Eligible Director Service Retainer): $15,000
|
2.
|
Annual Committee Member Service Retainer:
|
3.
|
Annual Committee Chair Service Retainer (in addition to Committee Member Service Retainer):
|
a.
|
Chairman of the Audit Committee: $7,500
|
b.
|
Chairman of the Compensation Committee: $5,000
|
c.
|
Chairman of the Nominating & Governance Committee: $4,000
|
d.
|
Chairman of the Science Committee: $5,000
|
e.
|
Chairman of the Finance Committee: $5,000
|
a.
|
In addition to the Science Committee Service Retainer, $1,000 per meeting of the Science Committee in excess of five meetings per year, not to exceed $7,000 per year.
|
1.
|
Initial Grant: On the date of the Eligible Director’s initial election to the Board, for each Eligible Director who is first elected to the Board (or, if such date is not a market trading day, the first market trading day thereafter), the Eligible Director will be automatically, and without further action by the Board or Compensation Committee of the Board, granted a stock option for 50,000 shares (the “Initial Grant”). The shares subject to each Initial Grant will vest with respect to one-third of the shares on the one-year anniversary of the date of grant, and in equal monthly installments over the following two-year period such that the option is fully vested on the third anniversary of the date of grant, subject to the Eligible Director’s Continuous Service (as defined in the Plan) through each such vesting date and will vest in full upon a Change in Control (as defined in the Plan).
|
2.
|
Annual Grant: On the date of each Bellicum annual stockholder meeting, for each Eligible Director who continues to serve as a non-employee member of the Board (or who is first elected to the Board at such annual stockholder meeting), the Eligible Director will be automatically, and without further action by the Board or Compensation Committee of the Board, granted a stock option for 25,000 shares (the “Annual Grant”). In addition, each Eligible Director who is first elected to the Board and other than at an annual stockholder meeting will be automatically, and without further action by the Board or Compensation Committee of the Board, granted an Annual Grant, pro rated for the number of months remaining until the next annual stockholder meeting. The shares subject to the Annual Grant will vest in full on the one-year anniversary of the date of grant, subject to the Eligible Director’s Continuous Service (as defined in the Plan) through such vesting date and will vest in full upon a Change in Control (as defined in the Plan).
|
Article I
|
PURCHASE AND SALE
|
1
|
|
||
|
Section 1.01
|
Purchase and Sale of Assets
|
1
|
|
|
|
Section 1.02
|
Excluded Assets
|
2
|
|
|
|
Section 1.03
|
Assumed Liabilities
|
4
|
|
|
|
Section 1.04
|
Excluded Liabilities
|
4
|
|
|
Article II
|
PURCHASE PRICE; PAYMENT
|
4
|
|
||
|
Section 2.01
|
Purchase Price
|
4
|
|
|
|
Section 2.02
|
Payment of Purchase Price
|
4
|
|
|
|
Section 2.03
|
Allocation of Purchase Price
|
5
|
|
|
|
Section 2.04
|
Withholding Tax
|
5
|
|
|
|
Section 2.05
|
Proration
|
6
|
|
|
Article III
|
CLOSING
|
6
|
|
||
|
Section 3.01
|
Closing
|
6
|
|
|
|
Section 3.02
|
Conditions Precedent to the Obligations of Buyer
|
6
|
|
|
|
Section 3.03
|
Conditions Precedent to the Obligations of Seller
|
9
|
|
|
Article IV
|
REPRESENTATIONS AND WARRANTIES OF THE SELLER
|
10
|
|
||
|
Section 4.01
|
Organization and Authority; Enforceability; Binding Agreement
|
10
|
|
|
|
Section 4.02
|
No Violation or Conflict; Consents
|
10
|
|
|
|
Section 4.03
|
[DELETED]
|
11
|
|
|
|
Section 4.04
|
Absence of Certain Changes, Events and Conditions
|
11
|
|
|
|
Section 4.05
|
Contracts
|
11
|
|
|
|
Section 4.06
|
Title to, Condition and Sufficiency of Purchased Assets
|
13
|
|
|
|
Section 4.07
|
Real Property; Leased Real Property
|
14
|
|
|
|
Section 4.08
|
Inventory
|
14
|
|
|
|
Section 4.09
|
Insurance
|
14
|
|
|
|
Section 4.10
|
Legal Proceedings; Governmental Orders
|
15
|
|
|
|
Section 4.11
|
Compliance with Laws; Permits
|
16
|
|
|
|
Section 4.12
|
Environmental Matters
|
17
|
|
|
|
Section 4.13
|
[DELETED]
|
17
|
|
|
|
Section 4.14
|
Employment Matters
|
17
|
|
|
|
Section 4.15
|
Taxes
|
19
|
|
|
|
Section 4.16
|
Brokers
|
19
|
|
|
|
Section 4.17
|
Solvency; No Fraudulent Conveyance
|
19
|
|
|
|
Section 4.18
|
No Other Representations or Warranties
|
20
|
|
|
|
Section 4.19
|
Accreditation
|
20
|
|
|
|
Section 4.20
|
Regulatory Compliance
|
20
|
|
|
|
Section 4.21
|
Personal Property
|
21
|
|
|
|
Section 4.22
|
Ethics Matters; No Financial Interest
|
21
|
|
|
|
Section 4.23
|
Texas Family Code Child Support Certification
|
22
|
|
|
|
Section 4.24
|
Certification Regarding Boycotting Israel
|
22
|
|
|
|
Section 4.25
|
Certification Regarding Business with Certain Countries and Organizations
|
22
|
|
|
|
Section 4.26
|
Access by Individuals with Disabilities
|
22
|
|
|
Section 4.27
|
TPIA
|
22
|
|
|
Article V
|
REPRESENTATIONS AND WARRANTIES OF BUYER
|
23
|
|
||
|
Section 5.01
|
Organization and Authority; Enforceability
|
23
|
|
|
|
Section 5.02
|
No Conflicts; Consents
|
23
|
|
|
|
Section 5.03
|
Legal Proceedings
|
23
|
|
|
|
Section 5.04
|
Brokers
|
23
|
|
|
|
Section 5.05
|
No Other Representations or Warranties
|
23
|
|
|
|
Section 5.06
|
Financial Ability to Perform
|
24
|
|
|
Article VI
|
COVENANTS
|
24
|
|
||
|
Section 6.01
|
Employees and Employee Benefits
|
24
|
|
|
|
Section 6.02
|
Conduct Prior to Closing
|
25
|
|
|
|
Section 6.03
|
Confidentiality
|
27
|
|
|
|
Section 6.04
|
Non-Solicitation
|
27
|
|
|
|
Section 6.05
|
Books and Records
|
28
|
|
|
|
Section 6.06
|
Public Announcements
|
28
|
|
|
|
Section 6.07
|
Bulk Sales Laws
|
29
|
|
|
|
Section 6.08
|
Tax Matters
|
29
|
|
|
|
Section 6.09
|
Further Assurances
|
30
|
|
|
|
Section 6.10
|
Access to Premises; Information
|
30
|
|
|
|
Section 6.11
|
Consents to Assignment
|
30
|
|
|
|
Section 6.12
|
Governmental Consents; Approvals
|
31
|
|
|
|
Section 6.13
|
[DELETED]
|
31
|
|
|
|
Section 6.14
|
Exclusivity
|
31
|
|
|
|
Section 6.15
|
Casualty
|
31
|
|
|
|
Section 6.16
|
[DELETED]
|
32
|
|
|
Article VII
|
INDEMNIFICATION
|
32
|
|
||
|
Section 7.01
|
Survival
|
32
|
|
|
|
Section 7.02
|
Indemnification by Seller
|
32
|
|
|
|
Section 7.03
|
Determination of Losses
|
33
|
|
|
|
Section 7.04
|
Indemnification by Buyer
|
33
|
|
|
|
Section 7.05
|
Indemnification Procedures
|
33
|
|
|
|
Section 7.06
|
Tax Treatment of Indemnification Payments
|
34
|
|
|
|
Section 7.07
|
Exclusive Remedies
|
34
|
|
|
|
Section 7.08
|
Limitation of Liability
|
34
|
|
|
Article VIII
|
TERMINATION
|
35
|
|
||
|
Section 8.01
|
Termination Events
|
35
|
|
|
|
Section 8.02
|
Effect of Termination
|
35
|
|
|
Article IX
|
MISCELLANEOUS
|
36
|
|
||
|
Section 9.01
|
Expenses
|
36
|
|
|
|
Section 9.02
|
Notices
|
36
|
|
|
|
Section 9.03
|
Interpretation
|
37
|
|
|
|
Section 9.04
|
Headings
|
38
|
|
|
|
Section 9.05
|
Severability
|
38
|
|
|
|
Section 9.06
|
Entire Agreement
|
38
|
|
|
|
Section 9.07
|
Successors and Assigns
|
38
|
|
|
|
Section 9.08
|
No Third-Party Beneficiaries
|
38
|
|
|
Section 9.09
|
Amendment and Modification; Waiver
|
38
|
|
|
|
Section 9.10
|
Governing Law and Venue
|
39
|
|
|
|
Section 9.11
|
State Auditor’s Office
|
39
|
|
|
|
Section 9.12
|
Dispute Resolution
|
39
|
|
|
|
Section 9.13
|
Texas State Agency
|
39
|
|
|
|
Section 9.14
|
Counterparts
|
40
|
|
|
|
Section 9.15
|
Payments by Electronic Funds Transfer
|
40
|
|
|
|
Section 9.16
|
Payment of Debt or Delinquency to the State
|
40
|
|
Section 1.01(a)
|
Assigned Contracts
|
Section 1.01(b)
|
Real Property Leases
|
Section 1.01(c)
|
Permits
|
Section 1.01(d)
|
Equipment Assets
|
Section 1.01(e)
|
Tangible Personal Property
|
Section 1.01(f)
|
Inventory
|
Section 1.02(a)
|
Excluded Assets
|
Section 4.02(a)
|
No Conflicts; Consents
|
Section 4.02(b)
|
Seller Governmental Authorizations
|
Section 4.05(a)
|
Material Contracts
|
Section 4.05(d)
|
With Respect to Assigned Contracts
|
Section 4.06(a)
|
Encumbrances
|
Section 4.06(c)
|
Sufficiency of Purchased Assets
|
Section 4.07
|
Real Property
|
Section 4.09
|
Insurance Policies
|
Section 4.10(a)
|
Legal Proceedings and Governmental Orders
|
Section 4.11(a)
|
Compliance with Laws
|
Section 4.11(b)
|
Permits
|
Section 4.12
|
Environmental Matters
|
Section 4.14(a)
|
Employment Matters
|
Section 4.14(e)
|
Employment Loss
|
Section 4.15
|
Taxes
|
Section 4.19
|
Accreditation
|
Section 6.01
|
Seller Employees
|
If to Seller:
|
If to Buyer:
|
Bellicum Pharmaceuticals, Inc.
2130 West Holcombe Blvd
Suite 800
Houston, TX 77030
Attention: General Counsel
Email: sward@bellicum.com
|
The University of Texas M.D. Anderson Cancer Center
Attn.: SVP and Chief Financial Officer
1400 Pressler Street, Unit 1495
Houston, Texas 77030
Fax No.: (713) 745-1034
Email: bbmelson@mdanderson.org
|
with a copy to
Pillsbury Winthrop Shaw Pittman LLP
2 Houston Center
909 Fannin Street, Suite 2000
Houston, TX 77010-1028
Attention: Andrew L. Strong
Email: andrew.strong@pillsburylaw.com
|
with simultaneous copies to
The University of Texas
M. D. Anderson Cancer Center
7007 Bertner Avenue, Unit 1674
Houston, Texas 77030-3907
Attention: Chief Legal Officer
Fax Number: (713) 745-6029
Email: ahkinzel@mdanderson.org
|
|
and
Executive Director of Real Estate
The University of Texas System
210 West 7th Street
Austin, Texas 78701
Fax Number: (512) 499-4523
|
|
and
Hunton Andrews Kurth LLP
200 Park Avenue, 52nd Floor
New York, New York 10166
Attention: Roger Griesmeyer
Email: rgriesmeyer@huntonak.com
|
Additional Defined Term
|
Agreement Reference
|
1934 Act
|
Section 4.11(c)
|
Agreement
|
Preamble
|
Allocation Schedule
|
Section 2.03
|
Amendment of Lease
|
Section 3.02(j)(v)
|
Assigned Contracts
|
Section 1.01(a)
|
Assignment and Assumption Agreement
|
Section 3.02(j)(ii)
|
Assignment and Assumption of Lease
|
Section 3.02(j)(v)
|
Assumed Liabilities
|
Section 1.03
|
Auditor
|
Section 9.11
|
Bill of Sale
|
Section 3.02(j)(i)
|
Buyer
|
Preamble
|
Buyer Indemnitees
|
Section 7.02
|
Chapter 2260
|
Section 9.12
|
Closing
|
Section 3.01
|
Closing Date
|
Section 3.01
|
Escrow Agreement
|
Section 3.02(j)(iii)
|
EIR
|
Section 4.26
|
Excluded Assets
|
Section 1.02
|
Excluded Contracts
|
Section 1.02(f)
|
Excluded Liabilities
|
Section 1.04
|
Additional Defined Term
|
Agreement Reference
|
HCAD Account
|
Section 6.08(d)
|
Indemnification Claim
|
Section 7.03
|
Indemnified Party
|
Section 7.03
|
Indemnifying Party
|
Section 7.03
|
Insurance Policies
|
Section 4.09
|
Inventory
|
Section 1.01(f)
|
Letter of Intent
|
Section 9.06
|
Manufactured Products
|
Section 1.01(c)
|
Master Services Agreement
|
Section 3.02(j)(iv)
|
Material Contract
|
Section 4.05(a)
|
Purchase Price
|
Section 2.01
|
Purchased Assets
|
Section 1.01
|
Real Property Lease
|
Section 4.07
|
Required Consents
|
Section 3.02(f)
|
Restricted Period
|
Section 6.04
|
Seller
|
Preamble
|
Seller Employees
|
Section 6.01(a)
|
Seller Indemnitees
|
Section 7.02
|
SOPs
|
Section 1.01(g)
|
Sublease Agreement
|
Section 3.02(j)(vii)
|
TCLR
|
Section 3.02(i)
|
TDLR
|
Section 3.02(i)
|
TEC
|
Section 4.22
|
Termination of Lease
|
Section 3.02(j)(v)
|
Third Party Claim
|
Section 7.05(b)
|
Transferred Employees
|
Section 6.01(a)
|
UT Board of Regents
|
Section 3.02(a)
|
Work Order #1
|
Section 3.02(j)(iv)
|
Section 1.
|
OVERVIEW
|
1.1
|
The Services will be described in one or more work orders mutually agreed upon and executed by the Parties pursuant to this Agreement (“Work Orders”) and are the subject of this Agreement. Each Work Order shall be in substantially the same form as the “Work Order Template,” Exhibit B with such additions and deletions as the Parties may agree.
|
1.2
|
Each Work Order executed by the Parties, the schedules, exhibits and attachments referenced in each Work Order and the exhibits referenced in this Agreement are incorporated into this Agreement.
|
1.3
|
Other than as described in Section 8.12.F hereof, with regard to the APA, the Agreement shall control and govern all Services performed by MD Anderson under any Work Order. If there is a conflict or inconsistency between the provisions of this Agreement and any Work Order, the terms of the Work Order, including the schedules, exhibits and attachments referenced therein, shall be governed by the terms of this Agreement, unless an individual Work Order expressly and specifically notes the deviations from the terms of the Agreement and exhibits for the purposes of such Work Order in the “Deviations from Terms of Master Services Agreement” section of such Work Order. In the event of a conflict between the Agreement, a Work Order and any Quality Assurance Agreement, if applicable, the terms of the Quality Assurance Agreement shall control.
|
1.4
|
All capitalized terms used herein, including the exhibits, schedules and attachments hereto, shall have the meanings specified in the “Definitions,” Exhibit A or elsewhere in the Agreement, as applicable, unless otherwise specified.
|
Section 2.
|
SERVICES
|
2.1
|
Services Generally. During the Term and in accordance with this Agreement, MD Anderson agrees to provide certain Services, which shall include cell therapy Manufacturing and related activities, as described in Work Orders. MD Anderson and Bellicum have agreed that the scope of Services, including the Initial Supply Commitment and Expansion Option, will be limited to the Manufacture of all Current Bellicum Products and up to two (2) new pre-clinical or clinical stage products. In addition, if either the BPX-601 (within 9 months of the Effective Date) or BPX-603 (within 12 months of the Effective Date) is discontinued for clinical and/or regulatory reasons , Bellicum shall have the right to replace one (1) such discontinued product with another one (1) GoCAR-T product with similar Manufacturing and analytical processes (the “Product Swap”). If Bellicum exercises its right to the Product Swap, then the Parties will negotiate a technical transfer and process introduction plan to be paid by Bellicum at MD Anderson’s fully loaded hourly rates. In addition, all engineering, training or qualification runs performed by MD Anderson in connection with such Product Swap shall count toward the Initial Supply Commitment.
|
2.2
|
Initial Supply Commitment. During the Term, the Parties agree that MD Anderson will Manufacture for Bellicum up to an aggregate of two hundred (200) doses of proprietary cell therapy products (each dose a “Patient Lot”) in accordance with, and subject to, the applicable Work Order, provided that Bellicum has complied with all Bellicum Obligations (collectively, the “Initial Supply Commitment”). During the final six (6) months of the Term, no new Work Orders may be requested by Bellicum. For the avoidance of doubt, upon the earlier conclusion of the Term or fulfillment of the Initial Supply Commitment, MD Anderson shall no longer be obligated to perform Services unless otherwise provided in a Work Order, having no obligation to enter into such a Work Order.
|
2.3
|
Delivery, Title and Risk of Loss.
|
2.3.A
|
All Deliverables delivered pursuant to any Work Order, including the Patient Lots, shall be Delivered by MD Anderson EX WORKS (Incoterms 2017). Title to and risk of loss with respect to any Patient Lot or other Deliverable shall pass from MD Anderson to Bellicum at the time such Patient Lot or other Deliverable is released to Bellicum, or Bellicum’s carrier, provided that the foregoing shall not relieve MD Anderson of liability arising from MD Anderson’s negligence or any failure to comply with its obligations with respect to the proper storage conditions and handling prior to the tender thereof to the carrier. Bellicum shall be responsible for transporting all Deliverables from the Facility to any Bellicum facility at Bellicum’s sole cost and expense. MD Anderson will not be responsible for any transportation costs, materials, insurance, or otherwise related to the Deliverables.
|
2.3.B
|
MD Anderson’s responsibility with respect to the care, custody and control of the Materials shall not begin until the Materials have been physically unloaded from trailers and MD Anderson has begun receiving the Materials at the Facility, as evidenced by a duly authorized warehouse receipt.
|
2.4
|
Bellicum Obligations. For all Services, unless otherwise expressly agreed by the Parties in writing, Bellicum shall (1) pay for and deliver to MD Anderson at the Facility, or other location designated in a Work Order, all Materials in the amounts necessary to meet Bellicum’s supply Forecast, (2) provide MD Anderson with all Specifications, including instructions for the Services for the Manufacture of the Deliverables, and ensure MD Anderson has the necessary information to allow MD Anderson to perform the Services in accordance with applicable Work Order and applicable QAA, (3) use commercially reasonable efforts to support MD Anderson in the performance of the Services including knowledge transfer and consultation as reasonably required by MD Anderson, at no charge to MD Anderson, (4) allow for any Lead-Time requirements provided in any Work Order or as otherwise agreed by the Parties, (5) be responsible for the expiration of any Materials, (6) provide MD Anderson a Forecast as described in the applicable Work Order and Section 2.9 below, (7) be responsible for all technology transfer, process Development,
|
2.5
|
Materials. All Materials provided by Bellicum to MD Anderson for use in the Manufacture of Patient Lots shall (1) remain the sole property of Bellicum, (2) be used by MD Anderson only in carrying out its obligations under the Agreement and for no other purpose, (3) not be transferred by MD Anderson to any Third Party that is not specifically authorized in advance and in writing by Bellicum, and (4) unless exhausted in the course of performing the Services, be returned to Bellicum, upon Bellicum’s request and at Bellicum’s expense, at the expiration or termination of the Agreement or when no longer required to be used under the Agreement. After delivery, MD Anderson will be responsible for storing such Materials for the performance of the Services. Bellicum shall provide MD Anderson with, or ensure MD Anderson has possession of, current, correct and complete Material Safety Data Sheets ("MSD Sheets"), or, if a MSD Sheet is not applicable, then a safety summary sheet which outlines the storage and handling requirements and other characteristics only with respect to those Materials that can be reasonably hazardous in nature (i.e., corrosive, toxic, ignitable, etc.) in order for MD Anderson to safely and properly store and handle such Materials. MD Anderson reserves the right to exclude Materials from the Facility (or require the immediate removal of such Materials) if MD Anderson reasonably determines that it does not have complete and correct information as required by this Section 2.5. Subject to Section 3.7, if Bellicum fails to remove the Materials, MD Anderson may dispose of such Materials in any lawful manner and shall incur no liability due to such disposition. Bellicum grants to MD Anderson a first priority lien upon, and security interest in and to, all Materials at any time deposited in the Facility or any warehouse owned or operated by MD Anderson and in all proceeds and/or products thereof. Such lien and security interest shall secure all fees and charges incurred with respect to Deliverables, whether or not such Deliverable is in MD Anderson’s possession or has been Delivered.
|
2.6
|
Standards. MD Anderson shall perform the Services in accordance with: (1) the Work Order, (2) the Specifications, (3) the QAA, and (4) applicable Laws. MD Anderson will perform the Services in a professional and workmanlike manner consistent with industry standards applicable to the performance of such Services.
|
2.7
|
Facility. The Services will be performed at the facility located at 2130 W. Holcombe Boulevard, Houston, Texas 77030 (the “Facility”), unless otherwise specified in a Work Order.
|
2.7.A
|
Capacity. During the Term and at no additional charge to Bellicum, MD Anderson agrees to dedicate capacity equivalent of up to two (2) biomanufacturing suites at the Facility as required, based upon Bellicum’s Forecasts, for MD Anderson to meet the Initial Supply Commitment. In order to assure availability of the dedicated capacity, MD Anderson shall ensure that an appropriate biomanufacturing suite is available to Manufacture a Patient Lot, in accordance with a Work Order, within three (3) days after notification by Bellicum.
|
2.7.B
|
Expanded Capacity Option. Bellicum shall have the option to request MD Anderson expand its total capacity described in Section 2.7A, as necessary to meet the capacity requirements of any existing Work Order, up to the equivalent of four (4) suites or two (2) ballrooms. MD Anderson shall allocate such additional capacity for Bellicum, provided (i) new Work Orders for such additional Services are executed by the Parties, (ii) Bellicum fully funds any required buildout for such expanded capacity and a reasonable period of time for such building is agreed upon, (iii) Bellicum agrees to pay for all Services performed in such additional space at market value pursuant to a mutually agreed upon Work Order; and (iv) MD Anderson has all necessary rights and permissions (Regental, landlord and otherwise) necessary or required to perform such buildout and provide such space, having no obligation to seek any rights or permissions not then presently available under any MD Anderson then-current real property lease for the Facility, (collectively, the “Expansion Option”). Following receipt of Bellicum’s notice to exercise the Expansion Option, MD Anderson shall confirm that it has all appropriate rights and permissions for any necessary buildout of the space. Upon receipt of MD Anderson’s confirmation, Bellicum shall pay MD Anderson an option fee of [***] U.S. dollars ($[***]) by wire transfer of immediately available funds to the account described in Section 7.2 hereof. For the avoidance of doubt, notwithstanding a successful exercise of the Expansion Option, upon conclusion of the Initial Term, or fulfillment of the Initial Supply Commitment, MD Anderson shall no longer be obligated to perform Services unless otherwise provided in a Work Order, having no obligation to enter into such a Work Order.
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2.8
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Documentation. MD Anderson shall maintain, and provide to Bellicum, records with respect to the Services and Deliverables in accordance with the QAA.
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2.9
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Forecasts.
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2.9.A
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Forecasts. After the Initial Forecast and within the first three (3) Business Days of each month during the Term, Bellicum will provide MD Anderson with monthly rolling forecasts of Bellicum’s anticipated Deliverable needs for the following six (6) calendar months (each, a “Forecast”). The first two (2) months of each Forecast will constitute a binding commitment on Bellicum to order the quantity of Deliverables forecasted for such period. For example, a Forecast provided in March will be binding for the months of March and April; accordingly, the Forecast provided in April, shall have the same April Deliverable commitment as provided in the March Forecast, but now the May Forecast will also be binding. However, for each binding month, Bellicum shall be permitted to vary the Forecasted Deliverable amount by up to the greater of 50% of the Deliverables ordered or one (1) Patient Lot. Projections for the non-binding period of each Forecast will constitute Bellicum’s reasonable best estimates of future orders, but shall not be binding on Bellicum. To the extent that Bellicum does not order Deliverables consistent with the binding portion of a Forecast, the greater of the Forecasted amount (including the 50% variability described above) or the actual number of orders, will count towards the Initial Supply Commitment. If Bellicum orders more Deliverables than Forecasted (including the 50% variability described above), MD Anderson will use good faith efforts to meet such orders, but the fees charged by MD Anderson for such Services shall be increased by 50%. For the avoidance of doubt, the following example is for illustrative purposes: if the Forecast for June is four (4) orders of a specific Deliverable, but Bellicum only places two (2) orders of such Deliverable, these orders will be deemed within the accepted variability for such Forecasted amount. However, if Bellicum only places one (1) order of such Deliverable during this month, then Bellicum’s order will not be deemed in compliance with the Forecasted amount and the four (4) Forecasted orders will count towards the Initial Supply Commitment. Similarly, if Bellicum places seven (7) orders within this month, then MD Anderson is only obligated to fulfill the six (6) orders which are within the accepted variability, but MD Anderson will use good faith efforts to fulfill the seventh (7th) order; however, such seventh (7th) order, if fulfilled, will be subject to a 50% increase in fees.
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2.9.B
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Forecast Timing. Within thirty (30) days of the execution of the first Work Order, Bellicum shall submit to MD Anderson its initial Forecast for each Deliverable under such Work Order (the “Initial Forecast”). Unless otherwise agreed by the Parties, the first month of the Initial Forecast shall commence on the first day of the next calendar month. For all other Work Orders, Bellicum shall submit Forecasts to MD Anderson upon the Work Order effective date or as otherwise mutually agreed in such Work Order. Services shall not begin until after the date covered in the Forecast; provided MD Anderson has received the applicable Forecast prior to such date.
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2.10
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Scheduling and Cancellations.
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2.10.A
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Scheduling. For each Patient Lot, Bellicum will notify MD Anderson when it becomes aware of the date on which a patient leukapheresis (the “Patient Apheresis”) will occur as well as the arrival date at the Facility. Such notification will occur at least three (3) Business Days prior to arrival of Patient Apheresis at the Facility.
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2.10.B
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Cancellations. If, following such initial notification, Bellicum determines that the Patient Apheresis will not be provided and the Patient Lot must be cancelled, Bellicum shall notify MD Anderson as soon as feasible. Upon such cancellation, Bellicum shall be responsible for reimbursement of any costs incurred by MD Anderson in preparation for such cancelled batch, excluding the costs of any Materials (so long as the Materials were provided by Bellicum). The first five (5) cancelled Patient Lots shall not be counted against the Initial Supply Commitment.
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Section 3.
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PRODUCT ACCEPTANCE; DEFECTS; REMEDIES
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3.1
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Acceptance of Patient Lots and Other Deliverables. Bellicum shall examine, inspect and test each Patient Lot or other Deliverable Delivered under the Agreement as soon as practicable after receipt. Bellicum shall notify MD Anderson in writing of any Patient Lot or Deliverable that is Non-Conforming Product within twenty-one (21) calendar days after the date of Delivery (“Acceptance Period”). If such notice is not provided prior to the expiration of the Acceptance Period, the Patient Lot or other Deliverable shall be deemed accepted and to be in conformance with the Agreement.
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3.2
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Acceptance of Materials. MD Anderson shall have the right to examine, inspect and test each Material provided to MD Anderson under the Agreement. MD Anderson shall notify Bellicum in writing of any Material that does not comply with the Specifications for such Material, or meet the requirements described in Section 2.5, and may reasonably reject, or refuse acceptance of, any such Material.
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3.3
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Non-Conforming Products. MD Anderson will not release for Delivery any Non-Conforming Product. In addition, all Patient Lots that are Non-Conforming Products, for which such non-conformance is (a) due to a Process Inherent Issue, or (b) is not due to the negligence or fault of MD Anderson, shall count against the Initial Supply Commitment.
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3.4
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Retesting. In the event Bellicum rejects a Patient Lot or other Deliverable as Non-Conforming Product, MD Anderson shall have the right to sample and retest such Patient Lot or other Deliverable, which shall be done as soon as practicable and at MD Anderson’s expense. In the event of a discrepancy between Bellicum’s and MD Anderson’s test results such that one Party’s results fall within the Specifications and the other Party’s test results fall outside the Specifications, or there exists a dispute over whether such failure is due (in whole or in part) to acts or omissions of Bellicum or any Third Party after Delivery, the Parties shall cause a testing laboratory agreeable to both Parties (cost split equally between the Parties, subject to reimbursement as set forth below) to perform comparative tests and/or analyses on samples of the alleged Non-Conforming Product. The testing laboratory’s results shall be in writing and shall be final and binding save for manifest error on the face of its report. Unless otherwise agreed to by the Parties in writing, the costs associated with such testing and review shall be borne by the Party against whom the testing laboratory result finally rules and such Party shall reimburse to the other Party the costs advanced to the laboratory pursuant to the foregoing sentence. The testing laboratory shall be required to enter into written undertakings of confidentiality and non-use no less burdensome than set forth or referred to by this Agreement.
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3.5
|
Remediation. If any Deliverable is considered Non-Conforming Product, MD Anderson shall, as promptly as reasonably possible, either: (a) remake or produce a new Deliverable, or (b) to the extent it is legally permitted and also reasonably practicable, rework or Reprocess the Patient Lot, so that the Patient Lot or Deliverable (x) can be deemed to have been Manufactured in compliance with cGMP and the agreed Batch Production Record, as applicable, and (y) conforms to the Specifications. The Parties shall agree, in good faith, on the timelines for such resupply or rework.
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3.6
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Remediation Costs.
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3.6.A
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To the extent the non-conformance of any Non-Conforming Product is directly attributable to the negligence or fault of MD Anderson and is not attributable to a Process Inherent Issue, then such resupply or rework Services, as described in Section 3.5 (a) or (b), shall be performed at MD Anderson’s cost and expense, including the cost of replacing the Materials. Alternatively, under such circumstances, rather than to have such resupply or rework Services, Bellicum may elect for MD Anderson to refund to Bellicum the amount paid by Bellicum for such Non-Conforming Product, or if payment has not already made, cancel the invoice for such order in which case MD Anderson shall only be responsible for compensating Bellicum for the cost of the Materials.
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3.6.B
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For all Non-Conforming Products, to the extent such non-conformance is not directly attributable to the negligence or fault of MD Anderson, then all such resupply or rework Services as described in Section 3.5 (a) or (b) shall be pursuant to a new Work Order and such Services shall be performed at Bellicum’s cost and expense, including the costs of the Materials.
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3.7
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Destruction of Non-Conforming Products and Materials. MD Anderson shall provide reasonable notice to Bellicum of MD Anderson’s intent to destroy Non-Conforming Products or Materials (in accordance with Section 2.5) and shall destroy such products unless otherwise instructed by Bellicum in writing within ten (10) days of such notice. If requested by Bellicum within such timeframe, MD Anderson shall make such Non-Conforming Products or Materials available to Bellicum. Bellicum shall have the right to make further use of Non-Conforming Products or Materials for research and Development purposes only, provided that such use does not violate any applicable Laws and in no event is used in connection with human use. In the event that Bellicum desires the use of such Non-Conforming Products or Materials, Bellicum shall pay for any materials, supplies, labor and pass-through testing costs incurred by MD Anderson in connection with the Services related to such products. MD ANDERSON SHALL HAVE NO LIABILITY WHATSOEVER WITH RESPECT TO ANY NON¬CONFORMING PRODUCTS OR MATERIALS USED BY, OR AT THE DIRECTION OF BELLICUM SUBSEQUENT TO SUCH REJECTION.
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Section 4.
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FAILURE TO SUPPLY
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4.1
|
In the event MD Anderson is not able to supply, or reasonably anticipates that it will not be able to supply, any Services under any Work Order for any reason, including without limitation force majeure according to Section 11.8, MD Anderson shall (i) without undue delay provide a written notice (e-mail is sufficient) to Bellicum stating in reasonable detail the cause of such supply inability and the proposed remedial measures and the date such inability is expected to end, and (ii) use commercially reasonable efforts to supply such Services as soon as practicable. The Parties will discuss in good faith all appropriate means of resolving such supply problems.
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4.2
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In the event that MD Anderson is unable to Manufacture and release three (3) consecutive Patient Lots of the same Deliverable or a total of six (6) Patient Lots of the same Deliverable in any rolling twelve (12) month period as required under a Work Order (excluding, in both circumstances, any Deliverables impacted by Process Inherent Issues), provided all Bellicum Obligations have been successfully met including timely delivery of the Materials to MD Anderson, then a supply interruption shall be deemed to have occurred (“Supply Interruption”). Provided that such Supply Interruption is not (a) caused by force majeure according to Section 11.8, (b) due to the fault of Bellicum or any Third Party, or (c) due to any Process Inherent Issue, a supply failure shall be deemed to have occurred (“Supply Failure”). In the event of a Supply Failure, MD Anderson shall, within sixty (60) calendar days from the beginning of the Supply Failure, prepare an action plan setting forth a proposal to determine the root cause of the Supply Failure and the corrective actions to be taken (the “Action Plan”). The Action Plan shall then be presented to the JSC within such sixty (60) day period. The JSC may accept, modify or reject such Action Plan. In the event the JSC cannot agree upon the proposed (or modified) Action Plan within fourteen (14) days, the matter shall be escalated to the senior management of the Parties in accordance with Section 10.2. If senior management, acting in good faith, cannot agree on an Action Plan within forty-five (45) days from the date of its referral to senior management, then MD Anderson shall have the right to terminate this Agreement upon fifteen (15) days notice.
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4.3
|
Upon determination that a Supply Failure has occurred and is incapable of being cured within sixty (60) days from the date it is deemed a Supply Failure, the Term of such applicable Work Order, as it related to such specific Deliverable, shall be automatically extended for the length of such Supply Failure (unless otherwise terminated in accordance with Section 4.2). For the avoidance of doubt, the length of the Supply Failure arising from the failure to Manufacture and release three (3) consecutive Patient Lots of the same Deliverable, shall commence on the date of the first failed Patient Lot and conclude on the successful implementation of the Action Plan, and the length of the Supply Failure arising from the failure to Manufacture and release a total of six (6) Patient Lots of the same Deliverable in any rolling twelve (12) month period, shall commence on the date of the last failed Patient Lot and conclude on the successful implementation of the Action Plan.
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Section 5.
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QUALITY AND REGULATORY MATTERS
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5.1
|
Quality Assurance Agreement. The Parties shall enter into a “Quality Assurance Agreement” (“QAA”) no later than seven (7) calendar days before the start of any Work Order for Manufacturing of any Deliverable. The QAA shall set forth the Parties' rights and obligations with regard to quality management, quality assurance, quality control, responsibilities of the Parties, documentation, product release procedure including the language of such documentation, regulatory items such as audits and inspections. Upon execution, the QAA for Patient Lots shall be deemed to be incorporated herein as Exhibit C.
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5.2
|
Process Changes. Changes to the Existing Process, Services, or Specifications, including changes to any Materials used to Manufacture the Patient Lots or other Deliverable, may only be made in accordance with the QAA. Actual costs incurred as a result of changes will be allocated as follows:
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5.2.A
|
MD Anderson shall solely bear all of its actual and related costs resulting from:
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(i)
|
Changes to the Facility (including but not limited to changes related to Facility safety) requested by MD Anderson; and
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(ii)
|
Changes requested or required by the Governmental Authorities relating to the Facility, and all investments related to the establishment, maintenance and improvement of cGMP.
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5.2.B
|
Bellicum shall solely bear all actual and related costs of Bellicum and MD Anderson resulting from:
|
(i)
|
Changes to the Existing Processes or Services requested by Bellicum, including any changes to the Manufacturing process, Specifications, Materials used to Manufacture the Patient Lots or other Deliverable;
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(ii)
|
Changes requested or required by the Governmental Authorities relating to the Existing Process, Services, or Manufacturing process used to Manufacture the Patient Lots or other Deliverable;
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(iii)
|
Any technology transfer from a supplier of Materials to another supplier or to MD Anderson (such as, but not limited to, the purchase of any necessary Manufacturing equipment and Manufacturing licenses) to the extent such transfer is authorized by Bellicum.
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5.3
|
Technical Site Visits by Bellicum (Audits, Person-in-Plant)
|
5.3.A
|
Audits. In accordance with the terms of the QAA, Bellicum shall be entitled annually to one (1) visit with up to two (2) persons for up to two (2) days to audit the parts of the Facility (“Audit”). Notwithstanding the foregoing, “for-cause” audits may be conducted as described in the QAA.
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5.3.B
|
During each audit, Bellicum may inspect corresponding documents (including records) that specifically relate to Manufacturing, quality control, storage, release, complaint/deviation investigations and cGMP activities performed by MD Anderson as related specifically to this Agreement. The right of audit provided herein does not include a right to access or inspect MD Anderson’s financial records.
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5.3.C
|
In addition to the authorized Audits, in accordance with the terms of the QAA and with at least thirty (30) days advance written notice to MD Anderson, Bellicum shall have the right, at its sole risk and expense, to have one (1) Bellicum employee or agent of Bellicum, who shall be approved by MD Anderson, at the Facility (“Person-in-Plant” or “PIP”) during core business hours to observe the production activities and provide support as the single point of contact for such activities.
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(i)
|
MD Anderson shall provide adequate office space for the PIP, including access to outside internet connection, and ensure that the PIP is kept reasonably informed of issues that arise that may affect the production or quality of Bellicum product.
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5.3.D
|
If an unplanned deviation or other issue arises that reasonably requires the PIP to have access to the Manufacturing facility or QC laboratory, MD Anderson shall grant the PIP reasonable access to those parts of the Facility as needed to evaluate, assess and confirm the satisfactory resolution of such issue.
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5.3.E
|
While on MD Anderson’s premises, Bellicum shall cause its auditors and PIPs to (i) abide by all applicable Laws, confidentiality obligations to Third Parties and MD Anderson’s rules and policies governing its premises, safety and security practices and operating procedures, and (ii) comply with all reasonable instructions of MD Anderson’s employees regarding safety and compliance within the premises and the overall use of MD Anderson’s premises and equipment, and (iii) operate in a manner as not to adversely interfere with operations at the Facility. Bellicum shall be solely responsible for the payment and provision to each such auditor and PIP of all compensation and employee benefits, and the withholding and payment of applicable taxes relating to such employment or engagement.
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Section 6.
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TERM OF AGREEMENT
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6.1
|
The initial term of the Agreement will commence on the Effective Date and continue for a period of three (3) years, unless sooner canceled, terminated or extended in accordance with the provisions of this Agreement, including all exhibits attached to and incorporated into this Agreement by this reference thereto (the “Initial Term”).
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6.1.A
|
Upon implementation of the Expansion Option, the Initial Term shall be extended through (a) the date that is three (3) years from the start of the Expansion Option, or (b) June 30, 2025, whichever comes first (the “Extended Term”) (the Initial Term and the Extended Term may be referred herein as the “Term”). In no event shall the Term extend beyond June 30, 2025.
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6.2
|
MD Anderson may suspend the Services performed under the Agreement with immediate effect if at any time MD Anderson reasonably believes, in its sole and absolute discretion, that (a) Bellicum or the Services has a material adverse effect upon MD Anderson, its patients, or personnel; (b) Bellicum or the Services are compromising MD Anderson’s established standards of care or performance; (c) the Services do not comply with any Laws of any Government Authority or Regulatory Authority having jurisdiction over the Services; (d) any of the representations
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6.3
|
Bellicum may terminate the Agreement with immediate effect (i) if any of MD Anderson’s representations or warranties set forth in the Agreement are incomplete, incorrect or inaccurate in any material respect as such applicable date, and MD Anderson fails to cure such inaccuracies within 30 days of written notice of such; (ii) the Services do not comply with any Laws of an applicable Governmental Authority or Regulatory Authority having jurisdiction over the Services and MD Anderson fails to cure such noncompliance within 30 days of written notice of such; (iii) upon the occurrence of a material breach of the Agreement by MD Anderson and MD Anderson fails to cure such breach within 30 days of written notice of such; or (iv) a Supply Failure that is not cured within sixty (60) days of written notice of such, or other timeframe as provided for in a JSC-approved action plan. In order for the termination to be effective, Bellicum shall send MD Anderson a Notice of Termination specifying the basis for termination and the Termination Date.
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6.4
|
Either Party may terminate a Work Order at any time and for any reason whatsoever upon thirty (30) days’ written notice to the other Party; provided, however, MD Anderson shall not be permitted to terminate any open Work Order related to the Initial Supply Commitment during the Initial Term except in accordance with Section 6.2 above. The Party terminating the Work Order will send the other Party a Notice of Termination which will specify the basis for termination and the effective date of the termination (“Work Order Termination Date”). Termination of a Work Order will not affect any other Work Order pursuant to this Agreement. Neither Party hereto shall by the termination of a Work Order be relieved of its respective obligation and liabilities in any way arising out of or related to the Services performed under such Work Order prior to the Work Order Termination Date, including the payment of all reasonable costs, fees and expenses incurred by a Party which are directly attributable to any termination for convenience by the other.
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6.5
|
Neither Party hereto shall by the expiration or termination of the Agreement be relieved of its respective obligations and liabilities in any way arising out of or related to the Services performed prior to the Termination Date, including but not limited to the payment by Bellicum to MD Anderson of all reasonable costs, fees and expenses incurred by MD Anderson related to such Services. In addition, in the event the Services are terminated by MD Anderson, Bellicum agrees to pay MD Anderson for all Services completed up through the Work Order Termination Date, any non-cancellable expenses (such as supplies or materials purchased based upon Bellicum’s Forecasts, or costs associated with the Expansion Option) and any costs which are directly attributable to any termination by Bellicum. Upon the receipt of a Notice of Termination from Bellicum, MD Anderson should immediately begin to orderly and efficiently wind down the Services to mitigate the fees and expenses paid by Bellicum for the wind down.
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6.6
|
The terms and provisions contained in the Agreement that by their sense and context are intended to survive the performance thereof by either or both Parties shall so survive the completion of performance and termination or expiration of the Agreement, including without limitation, the payment obligations, indemnity obligations, confidentiality provisions and limitations of liability set forth herein.
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Section 7.
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FEES, COSTS, EXPENSES, TAXES, CONSIDERATION AND INVOICING
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7.1
|
For each Patient Lot ordered within the Initial Supply Commitment, Bellicum shall pay MD Anderson the fees described in the applicable Work Order which shall, at a minimum, cover all actual costs to MD Anderson in performing the Services set forth in such Work Order, including but not limited to costs for supplies and consumables (other than the Materials), pass-through expenses, and labor costs. For the avoidance of doubt and unless otherwise specified herein or agreed upon by the Parties, MD Anderson shall not be required to incur any out-of-pocket expenses in performing the Services. For Patient Lots that exceed the Initial Supply Commitment, the Parties agree to negotiate in good faith pricing that appropriately compensates MD Anderson for its performance of such Services, which shall be stated in the applicable Work Order.
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7.2
|
MD Anderson will be compensated for the Services in accordance with the fee schedule set forth in each Work Order or as described herein. Within thirty (30) days from receipt of an invoice, Bellicum shall pay MD Anderson in immediately available funds by wire or electronic fund transfer for all undisputed amounts in each invoice. If Bellicum disputes, in good faith, all or a portion of the charges in an invoice, it shall notify MD Anderson that it disputes certain or all charges in the invoice within 30 days of receipt. For all disputed invoice amounts, the Parties shall seek to resolve the dispute pursuant to the process set forth in Section 11.10 of this Agreement. For any undisputed amounts not paid within 30 days, MD Anderson may charge interest on the past due and undisputed amount at a rate not in excess of the lesser of (a) the “Prime Rate” published in the Wall Street Journal, from time to time, plus one percent (1%), or (b) the maximum rate permitted by law, and Bellicum shall pay all reasonable attorney fees and costs of MD Anderson in enforcing collection of such undisputed amounts owing under the Agreement. All invoices shall be wired to the following account unless otherwise identified in writing by MD Anderson:
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SWIFT:
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CHASUS33 (used for international wires)
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ABA ROUTING NO.:
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021000021 (used for domestic wires)
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ABA ROUTING NO.:
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111000614 (used for domestic Automatic Clearing House)
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ACCOUNT NAME:
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The University of Texas M. D. Anderson Cancer Center
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ACCOUNT NO.:
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1586838979
|
REFERENCE:
|
Note: Please specify the contract or invoice number and the chartfield number, 710928-30-122140-46.
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7.3
|
Taxes. Bellicum shall be responsible for any taxes, duties and charges currently assessed or which may be assessed in the future, that are applicable to the Materials, whether stored at the Facility or otherwise.
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Section 8.
|
REPRESENTATIONS, WARRANTIES, LIABILITY AND INDEMNIFICATION
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8.1
|
Bellicum represents, warrants and covenants to MD Anderson that on and as of the date hereof:
|
8.1.A
|
It is duly formed, validly existing and in good standing under the laws of its state of jurisdiction or formation, with power and authority to carry on the business in which it is engaged and to perform its respective obligations under the Agreement.
|
8.1.B
|
The execution and delivery of the Agreement by it have been duly authorized and approved by all requisite corporate, limited liability company, partnership, or similar action.
|
8.1.C
|
It has all the requisite corporate, limited liability company, partnership, or similar power and authority to enter into the Agreement and perform its obligations hereunder.
|
8.1.D
|
The execution and delivery of the Agreement does not, and consummation of the transactions contemplated herein will not, violate any of the provisions of organizational documents, any agreements pursuant to which it or its property is bound, or, to its knowledge, any applicable laws.
|
8.1.E
|
The Agreement is valid, binding, and enforceable against it in accordance with its terms subject to bankruptcy, moratorium, insolvency, and other laws generally affecting creditors’ rights and general principles of equity (whether applied in a proceeding in a court of law or equity), and the Constitution and laws of the State of Texas;
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8.1.F
|
It is qualified to do business in the State of Texas;
|
8.1.G
|
The Materials delivered to MD Anderson pursuant to the Agreement will, at the time of such delivery, be free and clear of all liens;
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8.1.H
|
The Specifications are accurate and complete and includes all instructions and information necessary for MD Anderson to perform the Services; and
|
8.1.I
|
Any transportation provider or carrier of the Materials or Deliverable has represented and covenanted that it has Business Auto Liability Insurance covering all owned, non-owned or hired automobiles, with limits of not less than $1,000,000 single limit of liability per accident for Bodily Injury and Property Damage.
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8.2
|
MD Anderson represents, warrants and covenants to Bellicum that on and as of the date hereof:
|
8.2.A
|
MD Anderson has the full power and authority to execute and deliver this Agreement and to perform its obligations under this Agreement (not including the Expansion Option). The execution and delivery by MD Anderson of this Agreement to be executed and delivered by it, the performance by MD Anderson of its obligations hereunder and the consummation by MD Anderson of the transactions contemplated hereby have been duly and validly authorized. The Agreement is, when executed and delivered by the Parties thereto, the valid and binding obligation of MD Anderson, enforceable against MD Anderson in accordance with its terms;
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8.2.B
|
The execution, delivery and performance by MD Anderson of this Agreement, and the consummation of the transactions contemplated hereby, do not conflict with or result in a violation or breach of any provision of any Law or Governmental Order applicable to MD Anderson.
|
8.2.C
|
To MD Anderson’s knowledge, MD Anderson is not under investigation with respect to any violation of any Laws that prevent its performance of the Services.
|
8.2.D
|
To MD Anderson’s knowledge the performance of the Services by MD Anderson complies with all applicable Laws of a Governmental or Regulatory Authority having proper jurisdiction.
|
8.3
|
Bellicum warrants, represents, covenants, and agrees that it has all permits, licenses, and approvals required for it to request and receive the Services and has and will otherwise comply with all Laws of all Governmental Authorities and Regulatory Authorities that are now or may, in the future, become applicable to Bellicum, Bellicum’s business, equipment, and personnel engaged in Bellicum’s business, Bellicum’s receipt of the Services or its performance under the Agreement, or arising out of or incident to such performance. Bellicum will perform its obligations under the Agreement in compliance with applicable Laws. To Bellicum’s knowledge, Bellicum is not under investigation with respect to any violation of applicable Laws and there are no facts or circumstances that could form the basis for any such violation. Without limiting the generality of foregoing, no bribes, kickbacks, illegal payments, illegal political contributions, or other inappropriate payments, legal or illegal, have been made, directly or indirectly by or on behalf of Bellicum to obtain or retain business, and Bellicum is and has been in compliance with all legal requirements under local anti-corruption and bribery laws, in each case, in jurisdictions in which Bellicum is operating or conducting business (collectively, the “Anti-Bribery Laws”). Bellicum has not received any communication that alleges that Bellicum or any agent of Bellicum is not or may not be in compliance with, or has or may have any liability under, Anti-Bribery Laws. All reports, returns, statements, documents, registrations, filings, and submissions, which are required to be filed with any Governmental Authority relating to Bellicum and Bellicum’s business, have been duly and timely filed.
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8.4
|
Bellicum warrants, represents, covenants, and agrees that all information and Materials provided by Bellicum to MD Anderson in connection with the Services to be performed shall be de-identified and aggregated so as to conceal all Protected Health Information (“PHI”) as that term is defined in the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”).
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8.5
|
Bellicum warrants, represents, covenants, and agrees that the Materials, Specifications and any other processes or instructions provided to MD Anderson by or on behalf of Bellicum (“Covered Resources”) and MD Anderson’s use thereof (or access or exercise of any other rights granted under the Agreement with respect to such Covered Resources), and related to performance of the Services, and the MD Anderson’s receipt thereof, do not and shall not infringe or misappropriate the Intellectual Property rights of any Third Party, or otherwise conflict with the rights of any Third Party.
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8.6
|
Bellicum warrants, represents, covenants, and agrees that the licenses granted by Bellicum to MD Anderson in Section 9.6.B are the only licenses necessary for MD Anderson to use the Covered Resources in accordance with this Agreement.
|
8.7
|
Bellicum warrants, represents, covenants, and agrees that it has disclosed, and will continue to disclose, to MD Anderson, prior to tendering of any Materials to the Facility, any and all potential health, safety and/or environmental hazards that may be associated with transportation, storage or handling of the materials.
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8.8
|
Each Party warrants, represents, covenants, and agrees that: (i) it is not excluded from participation under any state or federal health care program , as defined in 42 U.S.C. §1320a-7b(f), or listed in the U.S. System for Award Management’s (“SAM”) List of Parties Excluded From Federal Procurement or Non-Procurement Programs, or the United States Office of Inspector General’s List of Excluded Individuals/Entities (“LEIE”); and (ii) no final adverse action, as such term is defined under 42 U.S.C. Section 1320a-7e(g), has occurred or is pending or threatened against it (collectively “Excluded/Adverse Actions”). Each Party shall notify the other Party of any Excluded/Adverse Actions or any basis therefore within two (2) days of the notifying Party learning of any such Excluded/Adverse Action or any basis therefore. If a Party is excluded from a state or federal health care program, the other Party may, in addition to any other remedies it may have, immediately terminate the Agreement.
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8.9
|
Each Party shall promptly notify the other Party, in writing, as soon as it becomes aware of any condition or circumstance which makes any of the representations or warranties set forth in the Agreement incomplete, incorrect or inaccurate in any material respect as of any date.
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8.10
|
MD ANDERSON HAS NOT MADE AND DOES NOT MAKE ANY WARRANTY OR REPRESENTATION WHATSOEVER, EITHER EXPRESS OR IMPLIED, AS TO THE FITNESS, CONDITION, MERCHANTABILITY, DESIGN, OR OPERATION OF THE SERVICES, THEIR FITNESS FOR ANY PARTICULAR PURPOSE, THE QUALITY OR CAPACITY OF THE SERVICES OR WORKMANSHIP IN THE SERVICES, NOR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER; BELLICUM ASSUMES ALL RISK AND LIABILITY RESULTING FROM THE USE OF THE SERVICES, INCLUDING RISKS OF DAMAGES, WHETHER USED SINGLY OR IN COMBINATION WITH OTHER PRODUCTS, MATERIALS, OR PERSONAL PROPERTY.
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8.11
|
EXCEPT AS PROVIDED FOR IN THE AGREEMENT, IN NO EVENT SHALL MD ANDERSON BE LIABLE FOR ANY LOSS, CLAIM, DAMAGE, OR LIABILITY, OF WHATSOEVER KIND OR NATURE, REGARDLESS OF THE LEGAL THEORY ASSERTED (INCLUDING, WITHOUT LIMITATION, BREACH OF CONTRACT, NEGLIGENCE, STRICT LIABILITY, OR ANY TORT CLAIM), WHICH MAY ARISE FROM OR IN CONNECTION WITH THE AGREEMENT, THE PRESENCE OF PIPS, OBSERVERS, AUDITORS OR OTHER PERSONS ON MD ANDERSON PREMISES OR THE USE, HANDLING OR STORAGE OF MATERIALS, DROP-SHIPPED MATERIALS OR THE SERVICES. NOTWITHSTANDING ANY OTHER PROVISION CONTAINED HEREIN, BELLICUM HEREBY RELEASES MD ANDERSON, SYSTEM, ITS REGENTS, AND THE OFFICERS, AGENTS, AND EMPLOYEES OF MD ANDERSON AND SYSTEM FROM ANY AND ALL LIABILITIES, LOSSES, CLAIMS, OR DAMAGES INCURRED IN CONNECTION WITH THE SERVICES AND THE AGREEMENT.
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8.12
|
Indemnification.
|
8.12.A
|
Indemnification by Bellicum. Subject to the other terms and conditions of this Section 8, Bellicum shall indemnify, defend and hold harmless each of MD Anderson, its Affiliates, and each of their respective Regents directors, managers, officers, employees, partners, contractors or agents (collectively, the “MD Anderson Indemnitees”) from and against all Losses incurred or sustained by, or imposed upon, any of the MD Anderson Indemnitees or that any of the MD Anderson Indemnitees may incur, as a result of, based upon, arising out of, with respect to, or by reason of, any one or more of the following: (a) any inaccuracy in, or breach of, any of the representations or warranties of Bellicum contained in the Agreement, or in any certificate or instrument delivered by or on behalf of Bellicum pursuant to the Agreement; (b) any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Bellicum pursuant to the Agreement, or any certificate or instrument delivered by or on behalf of Bellicum pursuant to the Agreement; (c) any fraud, willful misconduct or criminal acts of Bellicum, its Affiliates, or any of the respective Representatives of either, (d) any allegations that the Covered Resources, MD Anderson’s use thereof (or access or exercise of any other rights granted under the Agreement with respect to such Covered Resources), or the Services, infringe or violate the Intellectual Property rights of any Third Party, (e) MD Anderson’s performance of the Services in accordance with the Agreement; or (f) the presence of any Bellicum auditors, PIPs or any other Persons authorized or requested by Bellicum, at the Facility or at any other premises owned, leased or operated by MD Anderson; except to the extent any Losses described in (a) through (f) are directly attributable to the gross negligence or willful malfeasance of MD Anderson.
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8.12.B
|
Indemnification by MD Anderson. Subject to the Laws and Constitution of the State of Texas and subject to the statutory duties of the Texas State Attorney General, MD Anderson shall defend, indemnify, and hold harmless Bellicum and its Affiliates, and each of their respective their respective directors, managers,
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8.12.D
|
If Bellicum is the Indemnifying Party, it shall not be entitled to participate in the defense of any MD Anderson Indemnitee with respect to any Indemnification Claim, and will have no right to defend any MD Anderson Indemnitee against the Indemnification Claim. With respect to a Indemnification Claim arising under Section 8.12.A, the MD Anderson Indemnitees will, together with the Attorney General of the State of Texas, undertake the defense, compromise or settlement of each Indemnification Claim on behalf of and for the account and risk of Bellicum as the Indemnifying Party; provided, however, that no Indemnification Claim shall be compromised or settled without concurrent notice to the Indemnifying Party. Notwithstanding anything to the contrary in this Section 8.12, if the Indemnifying Party is a party to Indemnification Claim, the Indemnifying Party shall be entitled to conduct its own defense of such Indemnification Claim, but not the defense of any MD Anderson Indemnitee concerning such Indemnification Claim. No action taken by any MD Anderson Indemnitee in accordance with such defense and settlement shall relieve the Indemnifying Party of its indemnification obligations herein provided with respect to any damages resulting therefrom.
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8.12.E
|
The Indemnifying Party shall cooperate in all commercially reasonable respects with the Indemnified Party and the Attorney General of the State of Texas (as applicable) in the investigation, trial and defense of any Action that may be subject to this Section 8.12 and any appeal arising therefrom. The Parties shall cooperate with each other in any notifications to insurers. The Indemnifying Party shall assist and cooperate, at the cost of the Indemnifying Party, with the Indemnified Party in the making of settlements and the enforcement of any right of contribution to which any Indemnified Party may be entitled from any Person in connection with the subject matter of any litigation subject to indemnification hereunder.
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8.12.F
|
Bellicum and MD Anderson acknowledge and agree that the APA, including, but not limited to, its Section 2 and Section 7, provides an independent indemnification remedy and procedure that is in addition to, and not superseded by, that provided by this Section 8. Further, nothing in this Section 8 shall limit MD Anderson’s right to seek any equitable relief to which MD Anderson seeks hereunder or to seek any remedy on account of Bellicum’s criminal, intentional, fraudulent or willful misconduct.
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Section 9.
|
COVENANTS
|
9.1
|
Confidentiality: During the Term of the Agreement and for a period of two (2) years thereafter, neither Party will at any time, except as required to perform the Services or as authorized in writing by the Party disclosing information (“Disclosing Party”), supply, disclose, use, or otherwise permit access to any information, in whole or in part, that the other Party (“Receiving Party”) may acquire by reason of its performance under the Agreement and that concerns or in any way relates to the Disclosing Party, its Affiliates, and their respective regents, directors, officers, employees, or agents, including, without limitation, any information, data, or records pertaining to MD Anderson’s faculty, staff, patients, business, or financial affairs, the Services, and MD Anderson’s manufacturing processes (“Confidential Information”). The obligations in this Section 9.1 shall not apply to any Confidential Information that (i) is rightfully already in the Receiving Party’s possession at the time of disclosure by Disclosing Party, (ii) is or later becomes part of the public domain through no fault of Receiving Party, (iii) is received from a Third Party having no obligations
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9.2
|
Public Information: The Agreement and related information may be subject to public disclosure under Chapter 552, Texas Government Code. Bellicum shall be deemed to have knowledge of this law and the means of protecting Bellicum’s legitimate interests. Bellicum represents, warrants and agrees that the Agreement can be terminated if Bellicum knowingly or intentionally fails to comply with a requirement of Subchapter J, Chapter 552, Texas Government Code. MD Anderson strictly adheres to all statutes, court decisions and the opinions of the Texas Attorney General with respect to disclosure of public information under the Texas Public Information Act (TPIA), Chapter 552, Texas Government Code. In accordance with §§552.002 and 2252.907, Texas Government Code, and at no additional charge to MD Anderson, Bellicum will make any information created or exchanged with MD Anderson pursuant to the Agreement (and not otherwise exempt from disclosure under TPIA) available in a format reasonably requested by MD Anderson that is accessible by the public.
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9.3
|
Publicity: Unless otherwise required by applicable Law or the rules and regulations of any national stock exchange on which the securities of Bellicum are listed, no Party shall make any public announcements in respect of the Agreement or the transactions contemplated hereby or otherwise communicate with any news media without the prior written consent of the other Party, provided that Buyer strictly adheres to all statutes, court decisions and the opinions of the Texas Attorney General with respect to disclosure of public information under the Texas Public Information Act, Chapter 552, Texas Government Code, and that the press statement set forth on Exhibit I to the APA is otherwise hereby preapproved for dissemination. Further, Bellicum will not state or imply that MD Anderson endorses any of Bellicum’s products or services. All materials utilizing the name, trademarks, service marks, or symbols of MD Anderson or The University of Texas for any purpose, including, but not limited to, the use in advertising, marketing, and sales promotion materials or any other materials or mediums (such as the internet, domain names, or URL addresses), must be submitted to MD Anderson’s Chief Legal Officer for prior written approval at the following address:
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9.4
|
Compliance with Laws, Regulations and Policies: MD Anderson and Bellicum will cooperate fully in meeting any obligations imposed upon MD Anderson or Bellicum by any Governmental Authority with respect to the Services performed under the terms of the Agreement. This obligation will specifically include, but not be limited to, compliance with the Health Insurance Portability and Accountability Act. Bellicum (and its representatives, agents,
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9.5
|
Insurance:
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9.5.A
|
During the Term of the Agreement, Bellicum will carry at least the following insurance, with companies authorized to conduct the business of insurance in the State of Texas having an A.M. Best Rating of A-VII or better, and in amounts not less than the following minimum limits of coverage:
|
(i)
|
Workers’ compensation insurance, with statutory limits as required by the various laws applicable to Bellicum’s employees and subcontractors;
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(ii)
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Commercial General Liability Insurance with limits of not less than:
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(a)
|
Each Occurrence Limit $1,000,000
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(b)
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Personal & Advertising Injury $1,000,000
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(c)
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General Aggregate $2,000,000
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(d)
|
Products - Completed Operations Aggregate $2,000,000
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(iii)
|
MD Anderson is governed by the Texas Tort Claims Act, which sets forth certain limitations and restrictions on the types of liability and the types of insurance coverage that can be required of MD Anderson.
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9.5.B
|
Bellicum will deliver to MD Anderson evidence of insurance on a Texas Department of Insurance approved certificate form verifying the existence and actual limits of all required insurance policies after the execution and delivery of this Agreement. Additional evidence of insurance will be provided verifying the continued existence of all required insurance no later than thirty (30) days after each annual insurance policy renewal. All insurance policies will be endorsed and name MD Anderson and The Board of Regents of the University of Texas System (the “Board”) as Additional Insureds for liability caused in whole or in part by Bellicum’s acts or omissions with respect to its on-going and completed operations up to the actual liability limits of the required insurance policies maintained by Bellicum. Commercial General Liability will provide Additional Insured endorsement including ongoing and completed operations coverage will be submitted with the Certificates of Insurance. Commercial General Liability will be endorsed to provide primary and non-contributory coverage. Bellicum hereby waives all rights of subrogation against MD Anderson. All insurance policies will be endorsed to provide a waiver of subrogation in favor of MD Anderson. No policy will be canceled until after thirty (30) days' unconditional written notice to MD Anderson. All insurance policies will be endorsed to require the insurance carrier providing coverage to send notice to MD Anderson thirty (30) days prior to any cancellation, material change, or non-renewal relating to any insurance policy required in this Section 9.5. Bellicum will pay any deductible for any loss. All deductibles will be shown on the Certificates of Insurance. Bellicum’s insurance will be primary and non-contributory to any insurance carried or self-insurance program established by MD Anderson or System. Bellicum’s insurance will be kept in force until during the Term and for a period of one year thereafter.
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9.6
|
INTELLECTUAL PROPERTY
|
9.6.A
|
All deliverables, results and data generated by MD Anderson, whether patentable or not, in the course of performing the Services hereunder (including, without limitation, all Intellectual Property therein) shall be owned by Bellicum.
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9.6.B
|
Bellicum retains all right, title, and interest in and to any Bellicum Intellectual Property. Nothing in the Agreement shall be construed to grant MD Anderson any right or license to any Bellicum Intellectual Property except as expressly set forth herein. During the Term, Bellicum hereby grants to MD Anderson a fully paid, non-exclusive license under any and all Bellicum Intellectual Property and Bellicum Arising IP that is necessary for the sole and limited purpose of MD Anderson’s performance of its obligations under the Agreement, including the Services and the Manufacture of Patient Lots.
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9.6.C
|
MD Anderson retains all right, title, and interest in and to any MD Anderson Intellectual Property. Any Intellectual Property created or developed solely or jointly by MD Anderson in the course of performing the Services that relates generally to the Development or Manufacture of substances or drug products, including any process, protocol, technology, Know-How or the like that applies generally to the conduct by MD Anderson of laboratory and manufacturing operations and activities, and does not incorporate or utilize Bellicum Confidential Information or Bellicum Intellectual Property, shall be “MD Anderson Arising IP” and MD Anderson shall own all right, title and interest therein. MD Anderson hereby grants to Bellicum a fully paid, non-exclusive license, to use MD Anderson Arising IP for the sole and limited purposes of the Development, Manufacturing and Commercialization, by or on behalf of Bellicum or a Bellicum sublicensee, of Bellicum the cell therapy products that are the subject of one or more Work Order hereunder.
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9.6.D
|
All Intellectual Property created or developed by Bellicum or solely or jointly by MD Anderson in the course of performing the Services that incorporates or utilizes Bellicum Confidential Information or Bellicum Intellectual Property, shall be “Bellicum Arising IP” and the exclusive property of Bellicum. As such, if any such Bellicum Arising IP is created or developed solely by MD Anderson, MD Anderson shall provide written notice to Bellicum of any such Bellicum Arising IP, as soon as possible. MD Anderson hereby assigns to Bellicum all right, title, and interest in and to all such Bellicum Arising IP, and shall take any actions, including but not limited to the execution of documents, reasonably requested by Bellicum and at Bellicum’s expense, to effect the purposes of the foregoing.
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9.7
|
Referrals: It is understood and agreed by the Parties that: (i) there is no agreement hereunder that either Party refer business to the other Party or any of its Affiliates; (ii) no part of the Services provided or payments made hereunder are intended or should be construed to be in exchange for referrals or arranging referrals; and (iii) payments hereunder represent fair market value determined by the Parties through good faith, arms-length bargaining.
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9.8
|
Ethics Matters; No Financial Interest: Bellicum and its employees, agents, and representatives have read and understood the following prior to the commencement of Services under the Agreement: MD Anderson’s Ethics Policy, Conflicts of Interest Policy, and Standards of Conduct Guide available at http://www.mdanderson.org/about-us/doing-business/vendors-and-suppliers/index.html and at https://www.mdanderson.org/about-md-anderson/business-legal/conflict-of-interest.html, and applicable state ethics laws and rules available at www.utsystem.edu/ogc/ethics. Neither Bellicum nor its employees, agents, or representatives will assist or cause MD Anderson employees to violate MD Anderson’s Ethics Policy, Conflicts of Interest Policy, Standards of Conduct Guide, or applicable state ethics laws or rules. Bellicum represents and warrants that no member of the Board has a direct or indirect financial interest in the transaction that is the subject of the Agreement.
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Section 10.
|
GOVERNANCE
|
10.1
|
Joint Steering Committee: The Parties have formed a Joint Steering Committee (the “JSC”), in which each Party has appointed the following two (2) executive employees as such Party’s members of the JSC (the “Members”), all of whom shall be familiar with and have responsibility for oversight of the activities under the Agreement:
|
MD Anderson:
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Houman Mesghali
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Bellicum:
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Alan Smith
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10.2
|
Steering Committee Meetings: The JSC shall meet, in person or via teleconference or video-conference, on a reasonably regular basis, as planned and agreed by the JSC Members, and in any event within fourteen (14) calendar days after receipt of a written request for such a meeting by one Party to the other Party. The request shall describe the matters or issues to be discussed, including any matter in dispute, and the solution which the requesting Party proposes to be decided. Each Party may invite other employees to attend the JSC meeting from particular departments/areas of expertise as may be necessary to discuss the agenda topics or matters or issues in dispute. Any action or decision by the JSC shall be taken by unanimous consent of the JSC, with the Members of each Party collectively having a single vote, or by a written resolution signed by all of the Members. If the JSC is unable to reach unanimous consent on a particular matter or issue being discussed by the JSC, then the matter or issues will be referred by each Party to a responsible member of senior management to be designated by each Party, who will use good faith efforts to resolve such matter or issue.
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Section 11.
|
GENERAL PROVISIONS
|
11.1
|
Entire Agreement: The Agreement, read together with the specific provisions of the APA referred to in the Agreement, constitute the entire and complete agreement between the Parties with respect to the subject matter contemplated herein. The Agreement supersedes any prior agreements or understandings, whether written or oral, between the Parties with respect to the Services. To the extent that any provision of the Agreement conflicts with or is inconsistent with the terms of the APA, the APA shall govern.
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11.2
|
Amendment: No modification, alteration, waiver, or supplement of the Agreement will be effective unless it is set forth in a written instrument that is signed by both Parties to the Agreement.
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11.3
|
Independent Contractor: MD Anderson is an independent contractor with respect to the performance of all Services, and neither MD Anderson nor anyone employed by MD Anderson will be deemed for any purpose to be the employee, agent, servant, or representative of Bellicum in the performance of any Service or any part thereof in any manner dealt with herein. Bellicum will have no direction or control of MD Anderson or its employees and agents. Bellicum will not represent itself to be an agent or representative of MD Anderson or System or the State of Texas. MD Anderson shall never be liable for Bellicum’s federal or state income taxes, franchise taxes, or taxes on Bellicum’s personnel, including personal income tax and social security taxes associated therewith. Bellicum will cooperate with, and provide reasonable assistance to, MD Anderson in obtaining any tax exemptions to which MD Anderson is entitled.
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11.4
|
Non-Exclusive Agreement: Nothing in the Agreement is intended to prevent, or should be construed as preventing, MD Anderson from contracting with any Third Party for the provision of goods or services the same as or similar to the Services. MD Anderson may, notwithstanding anything contained herein to the contrary, engage in whatever activities MD Anderson chooses, in MD Anderson’s sole and absolute discretion, whether the same are competitive with Bellicum or otherwise. Bellicum acknowledges and agrees that this Section 11.4 is a material part of the consideration for MD Anderson to enter into this Agreement and to provide the Services.
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11.5
|
Assignment: No rights and privileges granted to any Party under the Agreement may be transferred or assigned without obtaining the prior written consent of the other Party. The foregoing prohibition will also apply to any change in control of Bellicum. Any attempt to transfer or assign any rights or privileges under the Agreement without having first obtained written consent from the other Party will be null and void and will entitle the other Party to immediately terminate the Agreement. Notwithstanding anything to the contrary herein, any assignment of the Agreement shall not relieve the assigning Party of its obligations hereunder.
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11.6
|
Severability: If any provision of the Agreement is held by a court of competent jurisdiction to be unenforceable, the Agreement shall be deemed to be amended to the extent necessary to make such provision enforceable, or, if necessary, the Agreement shall be deemed to be amended to delete the unenforceable provision or portion thereof. In the event any provision is deleted or amended, the remaining provisions shall remain in full force and effect.
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11.7
|
Non-Waiver of Defaults: Failure of any Party to declare any default by any other Party immediately upon occurrence thereof, or delay by any Party in taking any action in connection therewith, will not waive such default or a potential remedy for such default.
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11.8
|
Force Majeure: Except for the duty to make payments when due and any indemnification provisions under the Agreement, neither Party will be liable or responsible to the other for any loss or damage or for any delays or failure to perform due to causes beyond its reasonable control, including, but not limited to, acts of God, employee strikes, epidemics, war, riots, flood, fire, sabotage, or any other circumstances of like character.
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11.9
|
Notices: Any notice required or permitted to be sent under the Agreement will be delivered by hand, mailed by a nationally recognized overnight courier service (delivery receipt requested) with charges paid by the dispatching Party, or mailed by registered or certified mail, return receipt requested, to Bellicum or to MD Anderson, as the case may be, at the respective notice addresses identified in this Section 11.9. Notice so mailed will be deemed effective (A) upon hand delivery, (B) on the scheduled date of delivery by a nationally recognized overnight courier service, or (C) on the third (3rd) day following the date of deposit into the United States mail.
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11.10
|
Dispute Resolution: To the extent that Chapter 2260, Texas Government Code, as it may be amended from time to time (“Chapter 2260”), is applicable to the Agreement and is not preempted by other applicable law, the dispute resolution process provided for in Chapter 2260 will be used by MD Anderson and Bellicum to attempt to resolve any claim for breach of contract that cannot be resolved in the ordinary course of business. The chief business officer of MD Anderson will examine Bellicum’s claim and any counterclaim and negotiate in an effort to resolve the claims. The Parties specifically agree (i) neither execution of this Agreement by MD Anderson nor any other conduct, action or inaction of any representative of MD Anderson relating to the Agreement constitutes or is intended to constitute
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11.11
|
Counterparts; Facsimile Signature: The Agreement may be executed in any number of counterparts, each of which will for all purposes be deemed an original of the Agreement, but all of which together will constitute one and the same document. The Agreement also may be evidenced by facsimile signature or by e-mail delivery of a “.pdf” format data file, and facsimile or “.pdf” signature page will be deemed to be an original signature and is to be considered to have the same binding effect as the delivery of an original signature on an original contract.
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11.12
|
Survival: Expiration or termination of the Agreement will not affect any right or obligation that either Party may have accrued prior to such expiration or termination. In particular, all indemnity provisions of the Agreement will survive the expiration or termination of the Agreement.
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11.13
|
Governing Law and Venue: The Agreement will be construed under and in accordance with the laws of the State of Texas without reference to its conflicts of law provisions, and all obligations of the Parties created under the Agreement are performable in Harris County, Texas. Subject to the sovereign immunity of the State of Texas, any lawsuit brought against MD Anderson under the Agreement may only be filed in the State District Court in Harris County, Texas.
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11.14
|
Loss of Funding: Performance by MD Anderson under the Agreement may be dependent upon the appropriation and allotment of funds by the Texas State Legislature (the “Legislature”) and/or allocation of funds by the Board. If the Legislature fails to appropriate or allot the necessary funds, or the Board fails to allocate the necessary funds, then MD Anderson will issue written notice to Bellicum and MD Anderson may terminate the Agreement without further duty or obligation under the Agreement. Bellicum acknowledges that appropriation, allotment, and allocation of funds are beyond the control of MD Anderson.
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11.15
|
Certification regarding Boycotting Israel: Pursuant to Chapter 2270, Texas Government Code, Bellicum certifies that it (1) does not currently boycott Israel, and (b) will not boycott Israel during the Term. Bellicum acknowledges the Agreement may be terminated if this certification is inaccurate or becomes inaccurate at any time during the Term.
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11.16
|
Certification regarding Business with Certain Countries and Organizations: Pursuant to Chapter 2252, Texas Government Code, Bellicum certifies that it is not engaged in business with Iran, Sudan, or a foreign terrorist organization. Bellicum acknowledges the Agreement may be terminated if this certification is inaccurate or becomes inaccurate at any time during the Term.
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11.17
|
Construction. The Agreement shall not be construed either more favorably for or strongly against either of the Parties based upon which Party drafted it. Every covenant, term, and provision of the Agreement shall be construed simply according to its fair meaning.
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11.18
|
Headings. The headings used in the Agreement are used for reference purposes only and do not constitute substantive matters to be considered in construing the terms of the Agreement.
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11.19
|
State Auditor's Office. The State Auditor's Office may conduct an audit or investigation in connection with procurements made by MD Anderson as set out in Sections 51.9335(c), 73.115(c) and 74.008(c) of the Texas Education Code. This provision is included in contracts to (1) notify Bellicum that the State Auditor may require Bellicum to provide records related to the procurement; and (2) to be sure Bellicum notifies any subcontractors about this information.
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11.20
|
Texas Family Code Child Support Certification. Pursuant to Section 231.006, Texas Family Code, Bellicum represents and warrants that it is not ineligible to receive the award of or payments under the Agreement and acknowledges and agrees that the Agreement may be terminated and payment withheld if this certification is inaccurate.
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11.21
|
Texas State Agency:
|
11.21.A
|
MD Anderson is an agency of the State of Texas and under the Constitution and laws of the State of Texas possesses certain rights and privileges, is subject to certain limitations and restrictions, and only has such authority as is granted to it under the Constitution and laws of the State of Texas. Nothing in the Agreement is intended to be, or will be construed as, a waiver of the sovereign immunity of the State of Texas or a prospective waiver or restriction of any of the rights, remedies, claims, and privileges of the State of Texas.
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11.21.B
|
Any provision of any applicable law, rule, or regulation that invalidates any provision of the Agreement or would cause one or both of the Parties hereto to be in violation of law will be deemed to have superseded the terms of the Agreement. The Parties, however, will use reasonable efforts to accommodate the terms and intent of the Agreement to the greatest extent possible consistent with the requirements of the law and negotiate in good faith toward amendment of the Agreement in such respect.
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11.22
|
Rules of Construction. Interpretation of the Agreement shall be governed by the following rules of construction: (a) words in the singular shall be held to include the plural and vice versa and words of one gender shall be held to include the other gender as the context requires, (b) the word “including” and words of similar import shall mean “including, without limitation,” (c) provisions shall apply, when appropriate, to successive events and transactions, (d) the headings contained herein are for reference purposes only and shall not affect in any way the meaning or interpretation of the Agreement, (e) the words “herein,” “hereto,” “hereinafter” and words of similar import refer to the Agreement as a whole, (f) ”may” is permissive and “may not” is mandatory, (g) ”will” and “shall” are mandatory, not merely expressions of future intent or expectation, (h) items omitted from non-exclusive lists or examples shall not be deemed to be a purposeful omission of other items in such non-exclusive lists or examples, even if such items were originally included in such lists or examples or discussed between the Parties during the negotiation of the Agreement, and (i) the Agreement was drafted with the joint participation of both Parties and shall be construed neither against nor in favor of either, but rather in accordance with the fair meaning hereof.
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THE UNIVERSITY OF TEXAS
M. D. ANDERSON CANCER CENTER:
|
|
BELLICUM:
|
|
|
|
By:___________________________
|
|
By:___________________________
|
Name:________________________
|
|
Name:________________________
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Its:___________________________
|
|
Its:___________________________
|
|
|
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Read and Approved:
|
|
|
|
|
|
By:___________________________
|
|
|
Name: Jason B. Bock, PhD_______
|
|
|
Its: VP and Head of Biologics Development and Therapeutics Discovery
|
|
|
Optionholder:
|
|
Date of Grant:
|
|
Vesting Commencement Date:
|
|
Number of Shares Subject to Option:
|
|
Exercise Price (Per Share):
|
|
Total Exercise Price:
|
|
Expiration Date:
|
|
Vesting Schedule:
|
[One-fourth (1/4th) of the shares vest one year after the later of the (i) Vesting Commencement Date and (ii) Date of Grant; the balance of the shares vest in a series of thirty-six (36) successive equal monthly installments measured from the first anniversary of the Vesting Commencement Date, subject to Optionholder’s Continuous Service as of each such date]
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BELLICUM PHARMACEUTICALS, INC.
By:_________________________________________
Signature
Title:________________________________________
Date:________________________________________
|
OPTIONHOLDER:
____________________________________________
Signature
Date:________________________________________
|
Type of option (check one):
|
Incentive o
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Nonstatutory o
|
Stock option dated:
|
_______________
|
_______________
|
Number of Shares as
to which option is
exercised:
|
_______________
|
_______________
|
Certificates to be
issued in name of:
|
_______________
|
_______________
|
Total exercise price:
|
$______________
|
$______________
|
Cash payment delivered
herewith:
|
$______________
|
$______________
|
[Value of ________ Shares delivered herewith:
|
$______________
|
$______________]
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[Value of ________ Shares pursuant to net exercise:
|
$______________
|
$______________]
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[Regulation T Program (cashless exercise):
|
$______________
|
$______________]
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Optionholder:
|
|
Date of Grant:
|
|
Number of Shares Subject to Option:
|
|
Exercise Price (Per Share):
|
|
Total Exercise Price:
|
|
Expiration Date:
|
|
Vesting Schedule:
|
[For initial grants: The shares shall vest with respect to one-third of the shares on the one-year anniversary of the Date of Grant, and with respect to the remaining two-thirds of the shares in a series of twenty-four (24) successive equal monthly installments over the two-year period following such one-year anniversary of the Date of Grant, subject to Optionholder’s Continuous Service as of each such date and the potential acceleration provisions set forth in Section 9 of the Option Agreement] [For annual grants: The shares shall vest in full on the one-year anniversary of the Date of Grant, subject to Optionholder’s Continuous Service as of each such date and the potential acceleration provisions set forth in Section 9 of the Option Agreement]
|
Payment:
|
By one or a combination of the following items (described in the Option Agreement):
|
BELLICUM PHARMACEUTICALS, INC.
By:______________________________________
Signature
Title:_____________________________________
Date:_____________________________________
|
OPTIONHOLDER:
__________________________________________
Signature
Date:______________________________________
|
Type of option (check one):
|
Nonstatutory x
|
Stock option dated:
|
_______________
|
Number of Shares as
to which option is
exercised:
|
_______________
|
Certificates to be
issued in name of:
|
_______________
|
Total exercise price:
|
$______________
|
Cash payment delivered
herewith:
|
$______________
|
[Value of ________ Shares delivered herewith:
|
$______________]
|
[Value of ________ Shares pursuant to net exercise2:
|
$______________]
|
[Regulation T Program (cashless exercise3):
|
$______________]
|
Optionholder:
|
|
Date of Grant:
|
|
Vesting Commencement Date:
|
|
Number of Shares Subject to Option:
|
|
Exercise Price (Per Share):
|
|
Total Exercise Price:
|
|
Expiration Date:
|
|
Vesting Schedule:
|
[One-fourth (1/4th) of the shares vest one year after the later of the (i) Vesting Commencement Date and (ii) Date of Grant; the balance of the shares vest in a series of thirty-six (36) successive equal monthly installments measured from the first anniversary of the Vesting Commencement Date, subject to Optionholder’s Continuous Service as of each such date and the potential acceleration provisions set forth in Section 11 of the Option Agreement]
|
BELLICUM PHARMACEUTICALS, INC.
By:______________________________________
Signature
Title:_____________________________________
Date:_____________________________________
|
OPTIONHOLDER:
_________________________________________
Signature
Date:_____________________________________
|
Type of option (check one):
|
Incentive o
|
Nonstatutory o
|
Stock option dated:
|
_______________
|
_______________
|
Number of Shares as
to which option is
exercised:
|
_______________
|
_______________
|
Certificates to be
issued in name of:
|
_______________
|
_______________
|
Total exercise price:
|
$______________
|
$______________
|
Cash payment delivered
herewith:
|
$______________
|
$______________
|
[Value of ________ Shares delivered herewith:
|
$______________
|
$______________]
|
[Value of ________ Shares pursuant to net exercise2:
|
$______________
|
$______________]
|
[Regulation T Program (cashless exercise3):
|
$______________
|
$______________]
|
Vesting Schedule:
|
[25% of the Restricted Stock Units will vest on the one year anniversary of the earlier of the (i) Date of Grant and (ii) Vesting Commencement Date and 25% of the Restricted Stock Units will vest on each of the two, three and four year anniversaries of the Vesting Commencement Date, subject to the Participant’s Continuous Service through each such vesting date]
|
Issuance Schedule:
|
Subject to any Capitalization Adjustment, one share of Common Stock (or its cash equivalent, at the discretion of the Company) will be issued for each Restricted Stock Unit that vests at the time set forth in Section 6 of the Award Agreement.
|
BELLICUM PHARMACEUTICALS, INC.
By:______________________________________
Signature Title:_____________________________________
Date:_____________________________________
|
PARTICIPANT
_________________________________________
Signature
Date:_____________________________________
|
ATTACHMENTS:
|
Award Agreement and 2019 Equity Incentive Plan
|
(1)
|
Registration Statements (Form S-3 Nos. 333-219020, 333-226652, and 333-232771) of Bellicum Pharmaceuticals, Inc., and
|
(2)
|
Registration Statements (Form S-8 Nos. 333-201036, 333-216656, 333-218772, 333-220170, 333-223636, 333-225554, 333-231272, 333-232304, 333-232774, and 333-236149) pertaining to the 2006 Stock Option Plan, 2011 Stock Option Plan, 2014 Equity Incentive Plan, as amended, 2014 Employee Stock Purchase Plan, and 2019 Equity Incentive Plan of Bellicum Pharmaceuticals, Inc.
|
Date: March 12, 2020
|
/s/Richard A. Fair
|
|
Richard A. Fair
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
Date: March 12, 2020
|
/s/ Atabak Mokari
|
|
Atabak Mokari
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|
(1)
|
this Annual Report on Form 10-K of the Registrant, to which this certification is attached as an exhibit (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
|
Date: March 12, 2020
|
/s/ Richard A. Fair
|
|
Richard A. Fair
|
|
President and Chief Executive Officer
|
(1)
|
this Annual Report on Form 10-K of the Registrant, to which this certification is attached as an exhibit (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
|
Date: March 12, 2020
|
/s/ Atabak Mokari
|
|
Atabak Mokari
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|