Item 1.01 Entry into a Material Definitive Agreement.
On April 8, 2021, KemPharm, Inc. (the "Company") entered into Amendment No. 1
(the "Amendment") to that certain Collaboration and License Agreement, dated
September 3, 2019, by and between the Company and Commave Therapeutics SA
(formerly known as Boston Pharmaceuticals Holdings SA) ("Commave") (as amended,
the "License Agreement"). As previously disclosed, under the License Agreement,
the Company has granted to Commave an exclusive, worldwide license to develop,
manufacture and commercialize its product candidates containing SDX
and d-MPH, including AZSTARYS™ and KP484.
Pursuant to the Amendment, the parties agreed to modify the compensation terms
of the License Agreement. Commave has previously paid the Company an upfront
payment of $10 million upon entry into the original License Agreement and $5
million upon the FDA acceptance of the NDA submission for AZSTARYS. Pursuant to
the Amendment, Commave has agreed to pay the Company $10.0 million within five
calendar days of the effective date of the Amendment as a result of the
regulatory approval of AZSTARYS in the United States. Commave will also pay the
Company $10 million within thirty calendar days following receipt of the
scheduling determination of the compound serdexmethylphenidate, or SDX, by the
U.S. Drug Enforcement Administration. SDX is the prodrug component of
AZSTARYS. In addition, the Amendment increases the total remaining future
regulatory and sales milestone payments related to AZSTARYS to up to an
aggregate of $590 million in payments upon the occurrence of specified
regulatory milestones related to AZSTARYS and upon the achievement of specified
U.S. net sales milestones. Further, Commave has agreed to pay the Company
quarterly, tiered royalty payments ranging from a percentage in the high single
digits to the mid-twenties of Net Sales (as defined in the KP415 License
Agreement) in the United States and a percentage in the low to mid-single digits
of Net Sales in each country outside the United States, in each case subject to
specified reductions under certain conditions, including with respect to the
final approval label, as described in the License Agreement. Commave is
obligated to make such royalty payments on a product-by-product basis until
expiration of the Royalty Term (as defined in the License Agreement) for the
applicable product.
Pursuant to the Amendment, the parties also agreed to modify Commave's right of
first refusal such that KemPharm's product candidate, KP922, is no longer
subject to Commave' right of first refusal to acquire, license or commercialize
any Additional Product Candidate. Commave's right of first refusal shall only
apply to any Additional Product Candidate which contains SDX, with such right of
first refusal expiring upon the acceptance of a new drug application for such
Additional Product Candidate containing SDX.
Except as modified by the Amendment, all terms and conditions of the License
Agreement remain in full force and effect.
The foregoing is a summary description of certain terms of the Amendment, is not
complete and is qualified in its entirety by reference to the text of the
Amendment, which the Company expects to file as an exhibit to the Company's
Quarterly Report on Form 10-Q for the quarter ending June 30, 2021.
Item 7.01 Regulation FD Disclosure.
On April 8, 2021, the Company issued a press release to announce the entry into
the Amendment, as well as information regarding a conference call and live audio
webcast with a slide presentation related thereto. A copy of the press release
and presentation are furnished as Exhibits 99.1 and 99.2, respectively, to this
Current Report on Form 8-K.
The information contained in this Item 7.01, and the press release and
presentation furnished as Exhibits 99.1 and 99.2, respectively, shall not be
deemed "filed" for purposes of Section 18 of the Exchange Act and are not
incorporated by reference into any of the Company's filings under the Securities
Act, whether made before or after the date hereof, except as shall be expressly
set forth by specific reference in any such filing.
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Caution Concerning Forward Looking Statements:
This Current Report on Form 8-K may contain forward-looking statements made in
reliance upon the safe harbor provisions of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward-looking statements include all statements that do not relate
solely to historical or current facts, including the Company's potential receipt
of milestone and royalty payments pursuant to the License Agreement, and can be
identified by the use of words such as "may," "will," "expect," "project,"
"estimate," "anticipate," "plan," "believe," "potential," "should," "continue"
or the negative versions of those words or other comparable words.
Forward-looking statements are not guarantees of future actions or performance.
These forward-looking statements are based on information currently available to
the Company and its current plans or expectations and are subject to a number of
uncertainties and risks that could significantly affect current plans. Risks
concerning the Company's business are described in detail in the "Risk Factors"
section of the Company's Annual Report on Form 10-K for the year ended December
31, 2020, and the Company's other filings with the Securities and Exchange
Commission. The Company is under no obligation to, and expressly disclaims any
such obligation to, update or alter its forward-looking statements, whether as a
result of new information, future events or otherwise.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
99.1 Press Release, dated April 8, 2021.
99.2 Management Presentation, dated April 8, 2021.
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