On January 9, 2024 Precision BioSciences, Inc. (Nasdaq: DTIL), an advanced gene editing company utilizing its novel proprietary ARCUS platform to develop in vivo gene editing therapies for sophisticated gene edits, including gene elimination, insertion, and excision, reported completion of a strategic transaction with TG Therapeutics, Inc. (Nasdaq: TGTX) for an exclusive license to develop Azercabtagene Zapreleucel (azer-cel) for autoimmune diseases, and other indications outside of cancer (Press release, Precision Biosciences, JAN 9, 2024, View Source [SID1234639165]).
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"We are excited to extend the utility of our allogeneic CAR T assets into immunology by collaborating with TG Therapeutics as they advance novel treatments for B-cell diseases. Key factors in our decision to partner with the TG team include their recent development, regulatory and commercial successes in the multiple sclerosis space, which we believe are strong indicators of the commitment and expertise they will bring to the development of azer-cel in autoimmune diseases," said Michael Amoroso, President and Chief Executive Officer at Precision BioSciences. "As TG Therapeutics assumes development of azer-cel for immunology, Precision will remain focused on capitalizing on the utility of ARCUS for gene elimination and gene insertion, beginning with our wholly owned PBGENE-HBV program for chronic hepatitis B and PBGENE-PMM for primary mitochondrial myopathy."
"After an extensive review of the CAR T products available for development in immunology, we are excited to bring azer-cel into our portfolio as we look to expand our offerings for patients suffering from autoimmune diseases," said Michael S. Weiss, Chairman and Chief Executive Officer of TG Therapeutics. "We are pleased to partner with Precision BioSciences for azer-cel, and the equity investment we are making is indicative of our optimism in the near- and long-term opportunities for ARCUS for in vivo gene editing."
In exchange for global rights to azer-cel for autoimmune diseases and indications outside of cancer, Precision will receive upfront and potential near-term economics valued at $17.5 million. The upfront payment of $7.5 million will consist of cash and the purchase of 2,920,816 shares of Precision common stock by TG Therapeutics at a price of $0.77 per share, a 100% premium to the 30-day volume-weighted average price (VWAP) prior to purchase. Precision will also receive $2.5 million within 12 months, as an equity investment in Precision’s common stock at 100% premium to the then 30-day VWAP prior to purchase. Upon the achievement of certain near-term clinical milestones, Precision will receive an additional $7.5 million payment in cash and the purchase of Precision common stock by TG Therapeutics at a 100% premium to the then current 30-day VWAP. Precision is eligible to receive up to $288 million in additional milestone payments based on the achievement of certain clinical, regulatory, and commercial milestones, in addition to high-single-digit to low-double-digit royalties on net sales.
"With this deal and the Imugene oncology collaboration for azer-cel announced in August 2023, Precision has now completed two cell therapy collaborations to realize value from our allogeneic CAR T platform while enabling development of azer-cel for patients in diseases with high unmet need. These transactions are expected to extend our runway and will fund continued development of our wholly owned in vivo gene editing programs. As a result of these two accretive partnerships, Precision has received or is eligible to receive $47 million in upfront and potential near-term payments and has the potential to receive more than $900 million in development, regulatory and commercial milestone payments," added Mr. Amoroso.
Although it has not finalized its full financial results for the year ended December 31, 2023, Precision expects to report that it had approximately $116 million in cash and cash equivalents as of December 31, 2023. Upfront and potential near-term cash from azer-cel transactions, along with existing cash and cash equivalents, expected operational receipts, continued fiscal and operating discipline, availability of Precision’s at-the-market (ATM) facility, and available credit are expected to extend Precision’s cash runway into the first half of 2026 and through clinical phase 1 readouts for its wholly owned HBV and PMM programs.
Precision will continue to evaluate potential partners for other assets from its allogeneic CAR T platform that are no longer being developed internally, including PBCAR19B stealth cell and BCMA targeting CAR T assets for multiple myeloma.