On June 2, 2021 Royalty Pharma plc (Nasdaq: RPRX) and MorphoSys AG (FSE: MOR; Nasdaq: MOR) reported a $2.025 billion strategic funding partnership as part of MorphoSys’ $1.7 billion acquisition of Constellation Pharmaceuticals (Nasdaq: CNST) (Press release, Royalty Pharma , JUN 2, 2021, View Source [SID1234583883]). This partnership is expected to fuel the expansion of the combined company’s capabilities to help enable the development and potential approvals of important cancer treatments.

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This funding partnership is anchored by Royalty Pharma’s acquisition of MorphoSys’ rights to receive future royalties on Janssen’s Tremfya (guselkumab). Tremfya is an anti interleukin (IL)-23, approved for the treatment of adults living with moderate to severe plaque psoriasis, and for adults with active psoriatic arthritis and is also in clinical development for ulcerative colitis and Crohn’s disease. In 2020, Tremfya generated sales of $1.347 billion.

Royalty Pharma will also acquire the rights to receive royalties and certain milestone payments on four attractive development-stage therapies:

Gantenerumab, an anti-amyloid-beta monoclonal antibody, in Phase 3 development for Alzheimer’s disease by Roche. Royalty Pharma will purchase the rights to receive 60% of MorphoSys’ future royalties on gantenerumab.
Otilimab, a fully human monoclonal antibody that inhibits granulocyte-macrophage colony-stimulating factor (GMCSF), in Phase 3 development for rheumatoid arthritis by GlaxoSmithKline. Royalty Pharma will purchase the rights to receive 80% of MorphoSys’ future royalties and 100% of its future milestones on otilimab.
Pelabresib, a bromodomain and extra-terminal (BET) inhibitor for myelofibrosis, in Phase 3 development by Constellation. Royalty Pharma will purchase the rights to receive 3% of future net sales of pelabresib.
CPI-0209, a second-generation enhancer of zeste homolog 2 (EZH2) inhibitor, in Phase 2 development for hematological malignancies and solid tumors by Constellation. Royalty Pharma will purchase the rights to receive 3% of future net sales of CPI-0209.
Strategic Funding Partnership

The long-term strategic funding partnership agreement is comprised of the following terms:

$1.425 billion upfront payment: In exchange for the rights to receive 100% of MorphoSys’ future royalties on Tremfya, 80% of MorphoSys’ future royalties and 100% of MorphoSys’ future milestone payments on otilimab, 60% of MorphoSys’ future royalties on gantenerumab, and 3% of future net sales of Constellation’s clinical stage assets (pelabresib and CPI-0209), Royalty Pharma will make a $1.425 billion upfront payment to MorphoSys, supporting its growth strategy. The proceeds will be used to support the financing of the Constellation transaction and the development of the combined pipeline.
Milestone payments: Royalty Pharma will make additional payments to MorphoSys of up to $150 million upon reaching certain milestones for otilimab, gantenerumab and pelabresib.
$350 million Development Funding Bonds: Royalty Pharma will provide MorphoSys with access to up to $350 million in Development Funding Bonds, with the flexibility to draw over a one year period, with a minimum draw of $150 million.
Equity Investment: After completion of the transaction, Royalty Pharma will purchase $100 million of ordinary shares of MorphoSys based on the average trading price of the shares over a period preceding the closing of the transaction. The investment will be subject to the required resolutions by the management board (Vorstand) and the supervisory board (Aufsichtsrat) of MorphoSys, and will constitute a cash capital increase of MorphoSys under an authorization to exclude subscription rights of existing shareholders. The new shares will be listed on the Frankfurt Stock Exchange.
"We are excited to partner with MorphoSys on this important transaction, which demonstrates the breadth of our funding capabilities and the unique role Royalty Pharma can play in M&A," said Pablo Legorreta, founder and Chief Executive Officer of Royalty Pharma. "By partnering on this important transaction, MorphoSys and Royalty Pharma have created a true win-win situation with the potential to improve the lives of cancer patients worldwide. In addition, this transaction adds one blockbuster drug and four attractive development-stage therapies to our pipeline, further diversifies our portfolio and significantly enhances our long-term expected growth."

"This transformational acquisition of Constellation represents a major step forward for MorphoSys as we bolster our position in hematology-oncology," said Jean-Paul Kress, M.D., Chief Executive Officer of MorphoSys "We are thrilled to announce this partnership with Royalty Pharma, which is providing more than $2 billion to fuel our proprietary drug development and commercialization. We are confident they will be a strong financial partner for years to come, enabling us to fund our growth and – with the addition of Constellation’s innovative pipeline – bring our attractive new candidates to patients."

Royalty Pharma Financial Guidance

This strategic funding partnership with MorphoSys is expected to further diversify Royalty Pharma’s portfolio with long-duration and innovative therapies. Royalty Pharma expects this transaction to add at least $150 million to Adjusted Cash Receipts by 2025 from only the Tremfya royalty and the minimum $150 million draw from the Development Funding Bonds with significant upside potential from the development-stage therapies.

Royalty Pharma expects to fund this transaction with existing cash on the balance sheet and to maintain significant financial capacity to deploy capital on additional value-creating opportunities. The transaction is contingent on the closing of MorphoSys’ acquisition of Constellation, which is expected in the third quarter of 2021.

Royalty Details

Therapy Therapeutic Area Estimated Royalty Expiration Royalty Rate
Tremfya Immunology 2031-2032 Tiered mid-single digit royalty
Gantenerumab Alzheimer’s disease 2033-2035 Tiered between 5.5% and 7.0%; Royalty Pharma will be entitled to 60% of total royalties
Otilimab Rheumatoid arthritis, COVID 2031-2035 Tiered double-digit royalty; Royalty Pharma will be entitled to 80% of total royalties
Pelabresib Cancer Not disclosed 3% of worldwide net sales
CPI-0209 Cancer Not disclosed 3% of worldwide net sales
Conference Call Information

Royalty Pharma will host a conference call and simultaneous webcast to discuss the transaction today, Wednesday, June 2 at 8:45 a.m. Eastern Time. A live webcast may be accessed from the "Events" page of the company’s website at View Source Please allow at least five minutes to register and access the presentation. A replay of the conference call and webcast will be archived on the company’s website for at least 30 days. To ask a question during the live broadcast or listen without internet access, please dial in at least 15 minutes in advance to ensure a timely connection to the call. The conference call can be accessed live over the phone by dialing +1 (833) 519-1253, or for international callers by dialing +1 (914) 800-3826. The passcode to access the conference call is 6878797.

Advisors

Goodwin Procter, Dechert and Maiwald acted as legal advisors to Royalty Pharma. Goldman Sachs Bank Europe SE acted as financial advisor to MorphoSys and Skadden, Arps, Slate, Meagher & Flom LLP acted as its legal advisor. Centerview Partners LLC and PJT Partners acted as financial advisors to Constellation and Wachtell, Lipton, Rosen & Katz acted as its legal advisor.

On June 2, 2021 Illumina reported that multibillion-dollar deal for cancer blood test developer Grail was already under an antitrust microscope in the U.S. and Europe. Now, the watchdogs have raised a new threat (Press release, Illumina, JUN 2, 2021, View Source [SID1234583608]).

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A federal court allowed U.S. regulators to potentially postpone their action to block the deal, pending legal outcomes across the pond—all while the deal runs up against a deadline set to expire before the end of this year.

Illumina CEO Francis deSouza described the Federal Trade Commission’s latest move as "time-wasting maneuverings" in a report from the Financial Times, after the agency asked a San Diego federal judge to drop the challenge it originally b
Under the watchful eye of regulators, the CMC team, medical affairs specialists, and ongoing gap analyses keep businesses in a constant state of refinement — driving better purity, yield, and scale-up.

The FTC originally intervened by claiming Illumina’s ownership of a proprietary cancer diagnostic could harm similar development efforts by other test makers, which almost assuredly rely on the company’s DNA sequencing hardware, with Illumina’s instruments and consumables making up about 75% of the global market.

Though court proceedings on a potential injunction against the buyout had been scheduled for early August, the FTC said moving forward would not be appropriate while European regulators are also holding up the deal, according to The Wall Street Journal.

The court granted the FTC’s withdrawal request but left the door open for the agency to pick up the case again internally later this year. The deal’s terms state the $8 billion transaction must close by December 20 at the latest.

RELATED: Illumina sues European Commission to stop investigation of $8B Grail acquisition

"The biggest challenge is getting the FTC to move with the appropriate sense of urgency and getting the FTC to stop the time-wasting maneuverings and just focus on the case and get this case to trial," deSouza told the FT.

Meanwhile, in Brussels, Illumina is mounting a separate legal challenge to an antitrust crackdown, saying the E.U. has no jurisdiction because Grail does no business in Europe. The commission’s directorate-general for competition took up the case after receiving requests from six countries: Belgium, France, Greece, Iceland, the Netherlands and Norway.

First announced last September, Illumina’s quest to buy back its own former spinout would give it a strong footprint in clinical testing, with Grail planning to launch its Galleri cancer screening blood test in the U.S. this year.

Designed to detect and trace the locations of as many as 50 different tumors from DNA found in a single blood draw, the Galleri test could reach 50 million people after its initial launch and before a full FDA submission slated for 2023, Ilumina has said, as the DNA sequencing giant plans to throw its manufacturing and marketing weight behind the effort.

RELATED: Illumina to pay $8B to reacquire cancer blood test maker Grail, with all eyes on 2021

Since it struck out on its own from Illumina in 2016, Grail has grown to more than 430 employees and raised nearly $2 billion in venture capital money, including investments from Bill Gates, Jeff Bezos and others, to support a clinical testing program spanning 115,000 participants with and without cancer.

And after regulators raised their concerns, Illumina pledged new standard contracts and guarantees to sequencing access for its oncology customers, alongside a commitment to lower prices by more than 40% over the next four years.

The contracts include 12 years’ supply of sequencing instruments and consumables with no price increases, and a promise not to discontinue the sale of any product as long as it’s being purchased by a cancer test developer.

On June 2, 2021 Lyra Therapeutics, Inc. (Nasdaq: LYRA), a clinical-stage therapeutics company leveraging its proprietary XTreo platform to enable precise, sustained, and local delivery of medications to ear, nose and throat (ENT) passages and other diseased tissues, and LianBio, a biotechnology company dedicated to bringing paradigm-shifting medicines to patients in China and other major Asian markets, reported a strategic partnership and exclusive license agreement for the development and commercialization of LYR-210 in Greater China (mainland China, Hong Kong, Taiwan, and Macau), South Korea, Singapore and Thailand (Press release, LianBio, JUN 2, 2021, View Source [SID1234583510]). LYR-210 is an anti-inflammatory, intra-nasal drug matrix in late-stage development that is designed to treat chronic rhinosinusitis (CRS), a debilitating inflammatory disease of the nasal passages.

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Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

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Under the terms of the agreement, Lyra will receive an upfront payment of $12 million and is eligible to receive up to $135 million in future payments based upon the achievement of specified development, regulatory and commercialization milestones. Upon commercialization on a region-by-region basis, Lyra also will be entitled to receive low double-digit royalties based on net sales of LYR-210 in the licensed territories. LianBio will be responsible for the clinical development and commercialization of LYR-210 in the licensed territories, and Lyra will retain all rights to LYR-210 in all other geographies. As part of the agreement, LianBio will also have the first right to obtain development and commercial rights in the licensed territories to Lyra’s LYR-220, an anti-inflammatory, intra-nasal, drug matrix in development for the treatment of CRS patients who have undergone a prior sinus surgery but continue to have persistent disease.

"We are delighted to enter into this strategic alliance with LianBio to expand the global reach of LYR-210 for millions of CRS patients who need new and innovative treatment alternatives to surgery," said Maria Palasis, Ph.D., CEO of Lyra. "The LianBio team has deep expertise in drug development and is well positioned to successfully commercialize LYR-210 in these Asian territories. The introduction of our novel, integrated ENT drug and delivery solution to the large patient populations in Asian markets supports our planned global commercialization strategy."

"CRS patients who have failed medical management are currently left with limited and invasive options to manage their disease," said Yizhe Wang, Ph.D., Chief Executive Officer of LianBio. "In clinical studies conducted to date, LYR-210 has demonstrated six months of clinically meaningful symptom improvement following a single administration in patients with and without polyps. With an estimated 88 million adult CRS patients in China alone, we believe LYR-210 has the potential to address a significant unmet medical need and meaningfully improve the standard of care for patients in Asia."

About LYR-210

LYR-210 is an investigational product candidate that utilizes Lyra’s proprietary XTreo platform to enable six months of local anti-inflammatory therapy from a single treatment for chronic rhinosinusitis (CRS). LYR-210 is designed as a non-invasive alternative to sinus surgery for the millions of CRS patients who have failed medical management. In the LANTERN Phase 2 clinical trial, LYR-210 (7500mcg) demonstrated rapid, clinically meaningful and durable symptom improvement in symptom scores over six months.

On June 2, 2021 Cytokinetics, Incorporated (Nasdaq: CYTK) reported that Robert I. Blum, President and Chief Executive Officer, is scheduled to participate in three virtual fireside chats at the following investor conferences (Press release, Cytokinetics, JUN 2, 2021, View Source [SID1234583461]):

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42nd Annual Goldman Sachs Healthcare Conference on Wednesday, June 9, 2021 at 3:00 PM EDT
JMP Securities Life Sciences Conference on Wednesday, June 16, 2021 at 4:00 PM EDT
Raymond James Human Health Innovation Conference on Monday, June 21, 2021 at 2:00 PM EDT
Interested parties may access the live webcasts of each presentation by visiting the Investors & Media section of the Cytokinetics website at www.cytokinetics.com. The replay of each presentation will be archived on the Presentations page within the Investors & Media section of Cytokinetics’ website for 90 days following the conclusion of the event.

On June 2, 2021 Bavarian Nordic A/S (OMX: BAVA, OTC: BVNRY) reported that the share buy-back program, which was announced and initiated on May 27, 2021, has now been terminated, as the intended number of shares under the program has been repurchased (Press release, Bavarian Nordic, JUN 2, 2021, View Source [SID1234583460]). The program was executed in accordance with the provisions of Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse and supplementing Regulation (EU) 2016/1052 of 8 March 2016, which together constitute the Safe Harbour Regulation. The purpose of the program was to meet the Company’s obligations arising from the share-based incentive program for the Board of Directors and Executive Management.

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Under the program Bavarian Nordic A/S has bought back 31,747 shares, cf. the table below:

Transaction date Number of shares Average purchase price, DKK Transaction Value, DKK

The details for each transaction made under the share repurchase program have been attached to this announcement.

With the transactions stated above, Bavarian Nordic A/S owns a total of 117,627 own shares, corresponding to 0.18% of the share capital. The total amount of shares in the company is 63,736,804 including treasury shares.