(Filing, 10-Q, Amgen, AUG 5, 2015, View Source [SID:1234507013])

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On August 6, 2015 Corcept Therapeutics Incorporated (NASDAQ: CORT), a pharmaceutical company engaged in the discovery, development and commercialization of drugs for the treatment of severe metabolic, oncologic and psychiatric disorders, reported its financial results for the quarter ended June 30, 2015 and provided a corporate update (Press release, Corcept Therapeutics, AUG 5, 2015, http://www.corcept.com/news_events/view/pr_1438807699 [SID:1234507046]).

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Corcept recorded net revenue of $12.0 million in the second quarter of 2015, compared to $5.9 million for the same period in 2014, an increase of 104 percent. The company has revised its 2015 revenue guidance from $47 – $53 million to $49 – $53 million.

At June 30, 2015, the company held cash and cash equivalents of $37.0 million, compared to $38.0 million at the end of the prior quarter. Based on its current plans, the company expects to reach cash-flow breakeven without needing to raise additional funds.

"More patients are receiving Korlym’s benefits and we’re confident that Korlym’s sales growth will continue. We fully expect that our newly-hired clinical specialists will make an increasing contribution to our revenue over the course of the year," said Joseph K. Belanoff, M.D., Corcept’s Chief Executive Officer. "We are proud of our second quarter results. As we have said before, our efficient cost structure and revenue growth are allowing us to fund our planned development programs."

Triple-Negative Breast Cancer Program

Corcept continues to dose patients in the efficacy portion of its Phase 1/2 open label trial of Korlym in combination with eribulin (Halaven) to treat GR-positive TNBC. Efficacy results are expected by the end of 2015. If the trial’s outcome is positive, the company plans to begin a Phase 3 study in early 2016.

Advancement of Selective GR Modulator CORT125134

Unblinded data from its Phase 1 study confirms that CORT125134, the lead compound in Corcept’s portfolio of next-generation selective GR modulators, is well-tolerated and shares Korlym’s ability to potently reverse the effect of excess cortisol activity, an important quality in treating metabolic disorders such as Cushing’s syndrome. CORT125134 is inactive at the progesterone receptor. In addition, studies in transgenic mice have shown CORT125134 to be even more potent than Korlym in treating certain solid tumor cancers. Corcept plans to advance the compound to Phase 2 as a potential treatment for Cushing’s syndrome and an oncology indication in early 2016.

"Our development program has grown in both depth and breadth," said Dr. Belanoff. "We are studying our approved product, Korlym, as a treatment for a severe form of breast cancer and are preparing to advance one of our next-generation selective GR modulators to Phase 2 as a potential treatment for both metabolic and oncologic diseases. Cortisol modulation is a critical medical platform and we are the leader in advancing it."

Financial Discussion

Corcept recorded a net loss of $1.9 million in the second quarter of 2015, compared to $7.6 million in the second quarter of 2014, including non-cash expenses of $2.3 million and $2.2 million in the second quarter of 2015 and 2014, respectively. Excluding these non-cash expenses, Corcept generated net income on a non-GAAP basis of $369,000 in the second quarter of 2015, compared to a non-GAAP net loss of $5.4 million in the second quarter of 2014.

Corcept’s cash balance at June 30, 2015 was $37.0 million, compared to $24.2 million at December 31, 2014.

Operating expenses for the second quarter were $13.1 million, compared to $12.4 million for the second quarter of 2014.

Selling, general and administrative expenses in the second quarter of 2015 were $9.3 million, compared to $8.0 million for the same period in 2014, due to higher staffing costs.

Research and development expenses in the second quarter of 2015 were $3.3 million, compared to $4.3 million for the second quarter of 2014. The decrease was primarily due to discontinuation of the company’s Phase 3 study in psychotic depression, offset by increased spending on its Phase 1/2 study of Korlym for the treatment of GR-positive TNBC and development of next-generation GR modulators.

Net loss for the second quarter of 2015 and 2014 included accreted interest expense for Corcept’s capped royalty financing obligation of $737,000 and $935,000, respectively.

On August 5, 2015 Sangamo BioSciences, Inc. (NASDAQ: SGMO) reported its second quarter 2015 financial results and accomplishments (Press release, Sangamo BioSciences, AUG 5, 2015, View Source [SID:1234507043]).

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For the second quarter ended June 30, 2015, Sangamo reported a consolidated net loss of $12.1 million, or $0.17 per share, compared to a net loss of $7.0 million, or $0.10 per share, for the same period in 2014. As of June 30, 2015, the Company had cash, cash equivalents, marketable securities and interest receivable of $218.6 million.

Revenues for the second quarter of 2015 were $8.4 million, compared to $10.4 million for the same period in 2014. Second quarter 2015 revenues were generated from the Company’s collaboration agreements with Shire International GmbH (Shire), Biogen Inc. (Biogen), enabling technology agreements and research grants. The revenues recognized for the second quarter of 2015 consisted of $7.8 million in collaboration agreements and $0.6 million in research grants, compared to $9.7 million and $0.7 million, respectively, for the same period in 2014.

The decrease in collaboration agreement revenues was primarily due to a decrease in revenues under the Company’s collaboration and license agreement with Shire, partially offset by an increase in revenues from the collaboration and licensing agreement with Biogen. In the second quarter of 2015, Sangamo recognized $3.9 million of revenues related to research services performed under the collaboration agreement with Shire, and $1.7 million of revenues related to research services performed under the collaboration agreement with Biogen. In addition, pursuant to the agreements entered into with Shire in January 2012 and Biogen in January 2014, Sangamo received upfront payments of $13.0 million and $20.0 million, respectively. These payments are being recognized on a straight-line basis over the initial six-year research term for Shire and approximately 40 months for Biogen. The Company recognized $0.5 million of the Shire upfront payment and $1.5 million of the Biogen upfront payment as revenue for the second quarter of 2015.

Research and development expenses were $15.6 million for the second quarter of 2015, compared to $13.5 million for the same period in 2014. The increase in research and development expenses was primarily due to the expansion of the technical operations group in order to manage third-party manufacturing relationships, improve internal process development and enhance the Company’s overall manufacturing capabilities. This expansion resulted in increased personnel expenses, including stock-based compensation, due to increased headcount as well as higher facilities and lab supply expenses to support operations.

General and administrative expenses were $5.0 million for the second quarter of 2015, compared to $4.0 million for the same period in 2014. The increase was primarily due to increases in professional services expenses and personnel-related expenses, including stock-based compensation.

Total operating expenses for the second quarter of 2015 were $20.6 million, compared to $17.4 million for the same period in 2014.

Six Months Results
For the six months ended June 30, 2015, the consolidated net loss was $17.4 million, or $0.25 per share, compared to a consolidated net loss of $14.6 million, or $0.22 per share, for the six months ended June 30, 2014. Revenues were $21.8 million for the first half of 2015, compared to $18.5 million for the same period in 2014. Total operating expenses were $40.3 million for the first half of 2015, compared to $33.2 million for the first half of 2014.

Recent Events

Consolidation of ZFP Therapeutic Strategy for Hemoglobinopathies Program in Beta-Thalassemia and Sickle Cell Disease. In May 2015 Sangamo announced the consolidation of development paths for its zinc finger nuclease (ZFN)-mediated genome editing programs targeting beta-thalassemia and sickle cell disease (SCD), which are being developed under the agreement with Biogen. This decision, made by the Biogen-Sangamo Joint Steering Committee, was based on preclinical data that support the development of a second generation approach (BCL11A Enhancer strategy) to increase levels of fetal globin as a potentially curative strategy for these diseases. We expect to file new Investigational New Drug (IND) applications for these programs in 2016.

Presentation of Data at the 2015 Annual Meeting of the American Society of Gene and Cell Therapy (ASGCT) (Free ASGCT Whitepaper). Sangamo presented eighteen abstracts, including featured presentations in the Presidential Symposium and Clinical Trial Spotlight session, at the 18TH Annual ASGCT (Free ASGCT Whitepaper) Meeting held in May 2015. The presentations included data from Sangamo’s therapeutic and research programs in HIV/AIDS, hemoglobinopathies, lysosomal storage disorders (LSDs) and other monogenic diseases, cancer immunotherapy, and advancements in the Company’s delivery technology.

Updated data were presented from subjects treated in Cohort 3* of Sangamo’s SB-728-1101 clinical trial, who received a T-cell product containing both CCR5-modified CD4 and CD8 T-cells. Two of the three subjects have demonstrated significant control of viral load during a treatment interruption (TI) from antiretroviral therapy (ART), one to levels that are quantifiable but considered to render the subject non-infectious and one who demonstrated a one log drop from peak viral load after a delayed onset of viremia. Both subjects remain off ART and on TI.

Sangamo scientists also presented new preclinical data from the hemoglobinopathies program, partnered with Biogen, demonstrating the effectiveness of knocking out the BCL11A Enhancer in hematopoietic stem and progenitor cells (HSPCs) to increase fetal globin levels specifically in red blood cell precursors.

Additionally, data from the Company’s proprietary ZFP Therapeutic programs in LSDs provided proof of concept for Sangamo’s In Vivo Protein Replacement Platform (IVPRP). The data demonstrated durable expression of functional enzyme sufficient to correct biomarkers of disease in mouse models of MPS I (Hurler syndrome) and MPS II (Hunter syndrome).

Internal Organization. Sangamo promoted Michael Holmes, Ph.D., to Vice President of Research from Vice President of Research-Genome Editing. Dr. Holmes, who has been with the company for fourteen years, is a co-developer of Sangamo’s ZFN genome editing platform and currently directs the Company’s IVPRP programs. In addition, Curt Herberts has been promoted to Vice President of Corporate Development from Senior Director of Corporate Development and Strategy. Mr. Herberts has responsibility for implementation of Sangamo’s corporate development strategy including in-licensing of complementary technologies and negotiating therapeutic collaborations and partnerships.

Financial Guidance for 2015

The Company reiterates its earlier guidance as follows:

Cash and Investments: Sangamo expects that its cash, cash equivalents and marketable securities will be at least $180 million at the end of 2015, inclusive of research funding from Biogen and research funding and certain milestone payments from Shire, but exclusive of funds arising or received from any additional new collaborations or partnerships, equity financings or other new sources.
Revenues: Sangamo expects that revenues will be in the range of $60 million to $70 million in 2015, inclusive of research funding from Biogen and research funding and certain milestone payments from Shire.
Operating Expenses: Sangamo expects that operating expenses will be in the range of $100 million to $110 million for 2015.

On August 5, 2015 OPKO Health, Inc. (NYSE:OPK), a multi-national biopharmaceutical and diagnostics company, reported operating and financial results for its second quarter ended June 30, 2015 (Filing, 8-K, Opko Health, AUG 5, 2015, View Source [SID:1234507042]).

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Business Highlights

• OPKO to Acquire Bio-Reference Laboratories: OPKO and Bio-Reference Laboratories signed a definitive merger agreement on June 3, 2015 under which OPKO will acquire Bio-Reference Laboratories. Bio-Reference Laboratories is the third largest full service clinical laboratory in the United States and is known for its innovative technological solutions and pioneering leadership in the areas of genomics and genetic sequencing. Through GeneDx, Bio-Reference Laboratories’ genetic sequencing laboratory, and GenPath Diagnostics, its Oncology and Women’s Health business units, Bio-Reference Laboratories has accumulated a vast array of genetic and genomics data that OPKO will make available to industry and academic scientists to enhance their drug discovery and clinical trial programs. Under the terms of the agreement, holders of Bio-Reference Laboratories common stock will receive 2.75 shares of OPKO common stock for each share of Bio-Reference Laboratories common stock. Closing of the transaction is subject to approval of Bio-Reference Laboratories’ shareholders, and other customary conditions. OPKO intends to leverage the national marketing, sales, and distribution resources of Bio-Reference Laboratories to enhance sales of OPKO’s 4Kscore test, a blood test that provides a man’s specific personalized risk score for aggressive prostate cancer, and other OPKO diagnostic products under development.

• Acquired EirGen Pharma; A Growing, Profitable Specialty Pharmaceutical Developer and Manufacturer: OPKO acquired EirGen Pharma, Ltd., a growing, profitable, cash flow positive specialty pharmaceutical company focused on the development, manufacturing, and commercial supply of high potency, high barrier to entry pharmaceutical products for sale in the U.S., Canada, Japan, Australia, Europe, and in other countries around the world. The company, situated in a state of the art, high containment research and development and manufacturing facility, is approved by the FDA, EMEA (European Health Authorities) and the PMDA (Japanese Health Authorities). To date, EirGen and its commercial partners have filed 10 product applications with the FDA and 5 each in Europe and Japan. EirGen has a strong research and development portfolio of over 20 niche, high barrier to entry drugs. EirGen will rapidly expand its drug portfolio with access to additional capital from OPKO, together with the generous benefits of Irish government programs encouraging research and development in Ireland. Eirgen also offers significant synergies and benefits to OPKO through is ability to manufacture OPKO’s current and future products which will contribute to a more favorable tax rate in the future.

• Rayaldee NDA Submission Accepted by FDA; Expected PDUFA date of March 29, 2016: OPKO previously announced successful top-line results from both of its pivotal Phase 3 trials with Rayaldee in late 2014. These trials were identical randomized, double-blind, placebo-controlled, multi-site studies intended to establish the safety and efficacy of Rayaldee as a new treatment for secondary hyperparathyroidism (SHPT) in patients with stage 3 or 4 chronic kidney disease (CKD) and vitamin D insufficiency.

• Completed the Enrollment in its ongoing Phase 3 Trial in Growth Hormone Deficient Adults: The trial is designed to evaluate the safety and efficacy of hGH-CTP with a primary endpoint of superiority compared to placebo in decreasing fat mass in adults with GHD. The trial is a randomized, double-blind, placebo-controlled, multi-center, global study in adults with GHD. The study is divided into two treatment periods: a 26-week, double-blind, placebo-controlled part, followed by a 26-week, open-label extension. The study is expected to end toward the second half of 2016; regulatory submission will follow study completion.

• IND for Long Acting Factor VIIa-CTP for Hemophilia Filed and Accepted: In March 2015, the FDA accepted OPKO’s IND application to Initiate a Phase 2a Trial for its Long-Acting Coagulation Factor VIIa-CTP to Treat Hemophilia. Clinical Trials are expected to commence during Q3 2015.

• Clinical Studies for Long Acting Oxyntomodulin for Obesity and Diabetes Expected to Begin During 2015: OPKO expects to commence studies for its long acting Oxyntomodulin for diabetes and obesity in the second half of 2015.

• OPKO’s 4Kscore Recommended in National Comprehensive Cancer Network Guidelines for Prostate Cancer Early Detection: The National Comprehensive Cancer Network (NCCN) included 4Kscore as a recommended test in the 2015 NCCN Guidelines for Prostate Cancer Early Detection. The panel concluded that the 4Kscore, as a blood test with greater specificity over the PSA test, is indicated for use prior to a first prostate biopsy or after a negative biopsy to assist patients and physicians in further defining the probability of high-grade cancer.

•
Rolapitant PDUFA Date is September 5, 2015: OPKO’s partner, TESARO, submitted a NDA to the FDA for approval of oral rolapitant, an investigational neurokinin-1 (NK-1) receptor antagonist in development for the prevention of chemotherapy-induced nausea and vomiting (CINV). The NDA is supported by data from four controlled studies covering a spectrum of patients receiving chemotherapy that commonly causes nausea and vomiting. The top-line results of three of the Phase 3 studies were previously announced by TESARO. Upon approval and following commercialization, OPKO will receive up to $110 Million in additional milestones and tiered, double digit royalties.

"The first half of 2015 was transformational for OPKO," said Phillip Frost, M.D., Chairman and CEO. "We believe that the closing of the Pfizer transaction, the acquisition of EirGen and our pending transaction with Bio-Reference will result in OPKO having significant revenue opportunities and an expanded commercial presence to broadly sell and market our products and services. The submission and acceptance of our NDA filing for Rayaldee were also important parts of bringing to market a new therapeutic option for patients with stage 3 or 4 chronic kidney disease and vitamin D insufficiency. We expect the initiation of our important clinical development programs for Factor VIIa-CTP and oxyntomodulin, products with great commercial potential, during the second half of the year," continued Dr. Frost. "The 4Kscore Test’s addition to the NCCN guideline represents a major step towards its becoming the standard of care for early detection of aggressive prostate cancer as well as obtaining reimbursement from the healthcare providers."

Financial Highlights

• Cash, cash equivalents and marketable securities were $221.2 million as of June 30, 2015.

¡ Reflects receipt of Pfizer upfront payments of $295.0 million, partially offset by a $94.7 million cash payment for the acquisition of EirGen (net of cash on hand of EirGen) and a one-time $25.9 million payment to the Office of the Chief Scientist in Israel related to the Pfizer transaction.

• Consolidated revenues increased to $42.4 and $72.5 million during the three and six months ended June 30, 2015 from $23.5 and $45.8 million in the comparable periods of 2014. Revenue for the three and six months ended June 30, 2015 included $17.7 and $30.2 million of revenue resulting from OPKO’s collaboration agreement with Pfizer. OPKO is recording revenue in connection with the Pfizer transaction on a straight-line basis over the expected development period.

• Net loss for the three and six months ended June 30, 2015 was $42.8 million and $159.9 million and included increased operating expenses including increased research and development expense of $13.3 million and $17.8 million, respectively, in comparison to the 2014 periods. Further, the three and six month periods included significant non-recurring and or non-cash charges, such as:

¡ $25.9 million of non-recurring operating expense related to the repayment of a grant to the Office of the Chief Scientist in Israel related to the Pfizer transaction; and

¡ $16.6 million and $66.3 million in non-cash charges related to the change in value of embedded derivatives during the three and six months of 2015, which are part of our January 2013 convertible senior notes due in 2033 (the "2033 Senior Notes"). This non-cash charge is principally a result of the increased market price of our common stock since December 31, 2014.

On August 5, 2015 PDL BioPharma, Inc. (PDL) (NASDAQ: PDLI) reported financial results for the second quarter and six months ended June 30, 2015 (Press release, PDL BioPharma, AUG 5, 2015, View Source [SID:1234507040]).

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Total revenues were $138.1 million for the three months ended June 30, 2015, compared to $162.8 million for the same period of 2014, and $287.8 million for the six months ended June 30, 2015, compared to $299.6 million for the six months ended June 30, 2014. During the three and six months ended June 30, 2015 and 2014, our Queen et al. royalty revenues consisted of royalties and maintenance fees earned on sales of products under license agreements associated with our Queen et al. patents. During the three and six months ended June 30, 2015 and 2014, royalty rights – change in fair value consisted of revenues associated with the change in fair value of our royalty right assets, primarily Depomed, Inc., The Regents of the University of Michigan , and Viscogliosi Brothers, LLC. Revenues for the quarter ended June 30, 2015 included $116.9 million in royalty and license payments from PDL’s licensees to the Queen et al. patents, $12.2 million in net royalty payments from acquired royalty rights and a change in fair value of the royalty rights assets, which included approximately $1.2 million in net cash royalty rights payments, and $9.0 million in interest revenue from notes receivable debt financings to late-stage healthcare companies. Revenues for the six months ended June 30, 2015 included $244.7 million in royalty and license payments from PDL’s licensees to the Queen et al. patents, $23.6 million in net royalty payments from acquired royalty rights and a change in fair value of the royalty rights assets, which included approximately $2.1 million in net cash royalty rights payments, and $19.5 million in interest revenue from notes receivable debt financings to late-state healthcare companies.

Total revenues decreased by 15% and 4%, respectively, for the three and six months ended June 30, 2015, when compared to the same periods in 2014. The decrease is primarily driven by the decrease in the Depomed royalty rights cash proceeds related to the Salix Pharmaceuticals, Ltd (recently acquired by Valeant Pharmaceuticals International, Inc.) excess supply of Glumetza at the wholesaler inventory levels, decreased interest revenues due to the early payoff of the AxoGen and Durata notes receivables, and decreased Actemra royalties as a result of the conclusion of the Actemra license agreement, partially offset by increased royalties from sales of Perjeta, Xolair, Kadcyla, Herceptin, and Tysabri.

Operating expenses in the second quarter of 2015 were $7.4 million, compared with $6.9 million in the second quarter of 2014. The increase in operating expenses for the three months ended June 30, 2015, as compared to the same period in 2014, was a result of an increase in general and administrative expenses of $1.0 million for professional service expenses mostly related to the asset management of Wellstat Diagnostics, partially offset by a decrease of $0.3 million for share-based compensation and a decrease of $0.2 million for legal services.

Operating expenses for the six months ended June 30, 2015 were $15.1 million, compared with $11.5 million in the first six months of 2014. The increase in operating expenses for the six months ended June 30, 2015, as compared to the same period in 2014, was a result of an increase in general and administrative expenses of $2.8 million for professional service expenses primarily related to the asset management of Wellstat Diagnostics and an increase of $0.9 million in share-based compensation.

Net income in the second quarter of 2015 was $78.3 million, or $0.47 per diluted share as compared with net income in the second quarter of 2014 of $92.1 million, or $0.52 per diluted share. Net income in the six months ended June 30, 2015 was $162.8 million, or $0.97 per diluted share as compared with net income in the first six months of 2014 of $164.9 million, or $0.94 per diluted share. The decrease in net income for the six months ended June 30, 2015, compared to the same period in 2014, is primarily driven by the decrease in the Depomed royalty rights cash proceeds.

Net cash provided by operating activities in the first six months of 2015 was $155.9 million, compared with $146.2 million in the same period in 2014. At June 30, 2015, PDL had cash, cash equivalents and short-term investments of $294.1 million, compared with $293.7 million at December 31, 2014. The change and slight increase in the cash balance at June 30, 2015 was primarily attributable to net cash provided by the proceeds from the March 2015 Term Loan of $100.0 million, proceeds from royalty rights of $2.1 million, and cash provided by operating activities of $155.9 million, offset in part by retirement of the Series 2012 Notes and May 2015 Notes for $177.4 million, payment of dividends of $49.1 million, repayment of a portion of the March 2015 Term Loan for $25.0 million, additional note receivable purchases of $5.2 million, and the payment of $0.6 million for debt issuance costs related to the March 2015 Term Loan.

Recent Developments

ARIAD Revenue Interest Assignment
On July 28, 2015, the Company entered into a revenue interest assignment agreement (the "Agreement") in which it agreed to provide ARIAD Pharmaceuticals, Inc. ("ARIAD") with up to $200 million in cash in exchange for royalties on the net revenues of Iclusig (ponatinib). Funding of the first $100 million will be made in two tranches of $50 million each, with the initial amount having already been funded on the closing date of the Agreement and an additional $50 million to be funded on the 12-month anniversary of the closing date. In addition, ARIAD has an option to draw up to an additional $100 million at any time between the six and twelve month anniversaries of the closing date.

PDL will initially receive 2.5% of the worldwide net revenues of Iclusig until the 12-month anniversary of the closing date, at which time the royalty increases to 5.0% of the worldwide net revenues of Iclusig and remains until December 31, 2018. Beginning January 1, 2019 and thereafter, the royalty rate will increase to 6.5%, subject to an additional increase to 7.5% if PDL’s funding exceeds $150 million. If PDL does not receive payments equal to or greater than the total amount funded on or before the fifth anniversary of each of the respective fundings, ARIAD will pay PDL make-whole payments calculated as the difference between the amounts funded by PDL and the amounts paid to PDL to such date.

PDL has a put option based upon certain events and ARIAD has a call option to repurchase the revenue interest at any time. Both the put and call prices have been pre-determined.