PROTAGONIST THERAPEUTICS, INC. Item 1.01 Entry into a Material Definitive Agreement.
On
The Restated Agreement relates to the development, manufacture and commercialization of oral Interleukin ("IL")-23 receptor antagonist drug candidates. The candidates currently in development pursuant to the Restated Agreement include PTG-200, PN-232 and PN-235. PTG-200 is an oral Interleukin ("IL")-23 receptor antagonist in Phase 2a development for the treatment of Crohn's disease ("CD"). PN-235 and PN-232 are second-generation oral IL-23 receptor antagonist candidates currently in Phase 1 studies. Janssen is primarily responsible for the conduct of the PTG-200 trial and the Company is primarily responsible for the conduct of the PN-232 and PN-235 Phase 1 studies.
General. Pursuant to the Restated Agreement, the parties have:
(a) amended development milestones to reflect Janssen's expected development of
collaboration compounds for multiple indications in the IL-23 pathway;
(b) limited the Company's further development and related expense obligations
under the Restated Agreement to the ongoing PTG-200 Phase 2a study, and the
ongoing Phase 1 studies in PN-232 and PN-235 described in the preceding
paragraph; Janssen is responsible for all other future development and
related expenses under the Restated Agreement;
(c) concluded the parties' two-year research collaboration, while enabling
Janssen to continue conducting additional research through July 2024 on
compounds developed pursuant to the Original Agreement.
Development Plan. The Restated Agreement enables Janssen to develop collaboration compounds for multiple indications. Janssen's current development plan contemplates parallel development of multiple collaboration compounds against multiple indications in the IL-23 pathway. Under the Restated Agreement, Janssen is required to use commercially reasonable efforts to develop at least one collaboration compound for at least two indications.
Development Expenses. Pursuant to the Original Agreement, the Company was
responsible for up to
The Company's development cost obligations in the Original Agreement for the
period following the effective date of the Original Agreement were as follows:
(a) up to
The Company's continuing development expense obligations under the Restated
Agreement are as follows: (a) the Company will continue to fund 20% of the costs
related to the ongoing Phase 2a study evaluating PTG-200 for the treatment of CD
(subject to the
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Certain of the Company's previous development expense obligations under the
Original Agreement have been limited or eliminated as follows: (a) the Company's
previous
Development Milestone Payments. The various milestone payment amounts in the Restated Agreement remain substantially the same as in the Original Agreement. Development milestones under the Original Agreement generally corresponded to development milestones for: (a) CD; (b) UC; and (c) any other indication (i.e., any indication other than CD and UC). To reflect parallel development of multiple indications in the IL-23 pathway, milestones under the Restated Agreement generally now correspond to the achievement of specified milestones in: (a) any initial indication (rather than CD, as in the Original Agreement); (b) any second indication (rather than UC, as in the Original Agreement); and (c) any third indication. With respect to Second Generation Products, milestone payments for second and third indications may be triggered by any Second Generation Product (i.e., not necessarily the Second Generation Product that triggered the initial payment for any indication, or the payment for a second indication). In addition, the opt-in payments contemplated by the Original Agreement related to the scope of Janssen's license rights have been converted into development milestones in the Restated Agreement.
Upcoming potential development milestones for Second Generation Products include:
(a)$7.5 million for completion of the first Phase 1 clinical trial of a Second Generation Product; (b)$25 million for dosing of the 3rd patient in the first Phase 2 clinical trial for any Second Generation Product for any indication; (c) $10 million for dosing of the 3rd patient in the first Phase 2 clinical trial for any Second Generation Product for a second indication (i.e., an indication different than the indication which triggered the$25 million milestone described in (b) immediately above); (d)$50 million for dosing of the 3rd patient in a Phase 3 clinical trial for a Second Generation Product for any indication; (e)$15 million for dosing of the 3rd patient in a Phase 3 clinical trial for a Second Generation Product for a second indication; and (f)$115 million for a Phase 3 clinical trial for a Second Generation Product for any indication meeting its primary clinical endpoint.
Potential development milestones for PTG-200 are unchanged, except that milestone achievement is generally no longer indication-specific, as described above.
Royalties; Sales Milestones. The mid-single digit to ten percent tiered royalty rates payable pursuant to the Original Agreement remain the same in the Restated Agreement. The sales milestone payments in the Original Agreement also remain the same in the Restated Agreement.
Development; Research; Other. Following completion of the ongoing Phase 2a study for PTG-200 and the ongoing Phase 1 studies for PN-232 and PN-235, the Company has no further collaborative development obligations under the Restated Agreement. Any further research and development will be conducted by Janssen.
Janssen retains exclusive, worldwide rights to develop and commercialize PTG-200 and any second-generation compounds derived from the research collaboration conducted under the Original Agreement, or Janssen's further research under the Restated Agreement.
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The Company will have the right to co-detail (for UC and CD indications) up to two of PTG-200 and any Second Generation Products in the U.S. market.
The description of the terms and conditions of the Restated Agreement set forth
herein is not complete and is qualified in its entirety by reference to the text
of the Restated Agreement, which the Company intends to file as an exhibit to
its Quarterly Report on Form 10-Q for the fiscal quarter ending
Cautionary Note on Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements for purposes
of the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Forward-looking statements include statements regarding the Company's
intentions or current expectations concerning, among other things, the
development of PTG-200, PN-232 and PN-235, and the Company's anticipated future
development expenses. In some cases, you can identify these statements by
forward-looking words such as "anticipate," "believe," "may," "will," "expect,"
or the negative or plural of these words or similar expressions. Forward-looking
statements are not guarantees of future performance and are subject to risks and
uncertainties that could cause actual results and events to differ materially
from those anticipated, including, but not limited to, the Company's ability to
earn milestone payments under its collaboration agreements, the impact of the
current COVID-19 pandemic on discovery and development efforts, and the
Company's ability to obtain and adequately protect intellectual property rights
for its product candidates. Additional information concerning these and other
risk factors affecting the Company's business can be found in its periodic
filings with the
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