UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The

Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): December 3, 2014 (November 26, 2014)

 

Array BioPharma Inc.

(Exact name of registrant as specified in its charter)

 

Delaware

(State or other jurisdiction
of incorporation)

 

001-16633

 

23-2908305

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

 

3200 Walnut Street, Boulder, Colorado

 

80301

(Address of principal executive offices)

 

(Zip Code)

 

303-381-6600

(Registrant’s telephone number, including area code)

 

 

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

 

o

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

 

o

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

 

o

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 



 

In this report, “Array BioPharma,” “Array,” “we,” “us” and “our” refer to Array BioPharma Inc., unless the context otherwise provides.

 

Item 1.01 Entry into a Material Definitive Agreement.

 

On December 3, 2014, Array BioPharma announced that it entered into a Termination and Asset Transfer Agreement dated November 26, 2014 (the “Novartis Agreement”) with Novartis Pharma AG (“Novartis”) and Novartis International Pharmaceutical Ltd. (“NIP”). Under the Novartis Agreement, Array, Novartis and NIP agreed to the terms pursuant to which Array will regain all development and commercialization rights to binimetinib, a MEK oncology program that Array had previously licensed to NIP under a License Agreement dated April 19, 2010 (the “Existing License Agreement”). When the transactions contemplated by the Novartis Agreement become effective, the Existing License Agreement will terminate.

 

Novartis’s divestiture of the binimetinib assets to Array and the termination of the Existing License Agreement pursuant to the Novartis Agreement is contingent upon, and shall automatically become effective as of (the “Effective Date”), the closing of the transactions announced by Novartis AG and GlaxoSmithKline PLC (“GSK Transactions”) on 22 April 2014.

 

The Novartis Agreement requires that Novartis, at its expense, transfer or exclusively license to Array all assets, including intellectual property, regulatory filings, technology, inventory and contract rights, owned by Novartis or its affiliates that relate to binimetinib worldwide. Array will receive an up-front payment of up to $85 million within 30 days of the Effective Date.  Following the Effective Date, Array will have full rights to develop, manufacture and commercialize binimetinib and will not be required to pay its portion of accrued co-development costs, including a $15 million payment for fiscal year 2014, as a result of the termination of the Existing License Agreement.

 

In addition to the Novartis Agreement, Array and Novartis will enter into certain ancillary agreements on the Effective Date relating to the transfer of the binimetinib assets, including (1) a Transition Agreement pursuant to which Novartis and its affiliates will provide certain regulatory assistance, development technology transfer, companion diagnostic assistance and other transition services, and financial support to Array; (2) certain clinical trial agreements to address the parties’ rights and obligations with respect to clinical trials involving binimetinib; (3) a Supply Agreement pursuant to which Novartis and its affiliates will manufacture and supply to Array binimetinib for use in clinical trials and provide manufacturing technology transfer services to Array and/or its contract manufacturing organizations; and (4) certain license agreements relating to the use by the parties of certain intellectual property that is currently used both on the binimetinib program and on other Novartis programs to enable Novartis to use such intellectual property on programs other than binimetinib and to enable Array to use such intellectual property on the binimetinib program after the Effective Date. The parties will also form a transition team comprised of representatives of Array and Novartis to facilitate the transition of the binimetinib assets and the ongoing clinical trials.

 

Novartis will be responsible for continued conduct and funding of the COLUMBUS trial. This obligation will transfer to any future owner of LGX818 (encorafenib).

 

All other clinical trials involving binimetinib, including the NEMO trial and MILO trial, will continue to be conducted as currently contemplated, with Novartis providing substantial financial support in the form of reimbursement to Array for all associated out-of-pocket costs and for one half of Array’s fully-burdened FTE costs based on an annual FTE rate. At designated points for each trial, Novartis will transition responsibility and provide this continuing financial support to Array for completing the trials.

 

·                  NEMO trial: Novartis will conduct and solely fund the Phase 3 NRAS melanoma clinical trial (NEMO) through June 30, 2016.  For all NEMO activities required following that date, Array would be responsible for conducting the trial and Novartis would provide the financial support to Array described above.

·                  MILO trial: Array will continue conduct and complete the Phase 3 low grade serous ovarian cancer trial (MILO) and Novartis will provide financial support to Array as described above.

 

1



 

·                  Novartis will conduct and fund, and transfer at designated times all other Novartis sponsored trials, including a series of planned clinical pharmacology and pediatric trials, through December 31, 2015. For all activities required following that date, Array will be responsible for conducting those trials and Novartis would provide financial support to Array as described above.

·                  On the Effective Date, Novartis will transfer at designated times, and Array will oversee the conduct and completion of, all ongoing and planned investigator sponsored clinical trials.  Novartis will provide financial support to Array as described above.

 

Novartis will remain responsible for conducting and funding development of the NRAS melanoma companion diagnostic until Premarket Approval is received from the U.S. Food and Drug Administration.  Following approval, Novartis will transfer the product and Premarket Approval to a diagnostic vendor of Array’s designation.

 

Novartis also retains binimetinib supply obligations for all clinical and commercial needs for up to 30 months after closing and will also assist Array in the technology and manufacturing transfer of binimetinib.  Novartis will also provide Array continued clinical supply of several Novartis pipeline compounds including, but not limited to, LEE011 (CDK 4/6 inhibitor) and BYL719 (α-PI3K inhibitor), for use in currently ongoing combination studies, and possible future studies, including Phase 3 trials, with binimetinib.

 

Each party has also agreed to indemnify and hold the other party and its affiliates harmless from and against certain liabilities identified in the Novartis Agreement and to a general release of claims relating to the Existing License Agreement. The Novartis Agreement may be terminated only upon the mutual agreement of Novartis and Array or by either Novartis or Array if the GSK Transactions are terminated without the consummation thereof.

 

Array issued a press release on December 3, 2014 announcing the Novartis Agreement and return of rights to binimetinib, a copy of which is attached to this Form 8-K as Exhibit 99.1.

 

Item 1.02                                           Termination of a Material Definitive Agreement

 

As described under Item 1.01 above, the Novartis Agreement provides for the termination of the Existing License Agreement upon the Effective Date and that all rights, licenses and obligations under the Existing License Agreement will be terminated, discharged and superseded by the Novartis Agreement. The disclosure in Item 1.01 above is hereby incorporated by reference in this Item 1.02.

 

The Existing License Agreement granted NIP the exclusive worldwide right to co-develop and commercialize binimetinib, as well as other specified MEK inhibitors. Under the agreement, NIP was responsible for all ongoing development activities and for the commercialization of products under the agreement, subject to Array’s right to conduct certain clinical studies and option to co-detail approved drugs in the U.S. In consideration for the rights granted to NIP under the agreement, Array received $45 million, comprising an up-front and milestone payment, in the fourth quarter of fiscal 2010 and subsequently received an aggregate of $15 million in clinical milestone payments. Up to approximately $407.5 million in aggregate milestone payments were payable by NIP if all remaining clinical, regulatory and commercial milestones specified in the agreement were achieved. NIP had also agreed to pay Array royalties on worldwide sales of any approved drugs with a higher rate applicable to U.S. sales so long as Array continued to fund its share of co-development costs under the program.

 

Item 9.01                                                  Financial Statements and Exhibits.

 

(d) Exhibits

 

Exhibit
No.

 

Description

 

 

 

99.1

 

Press Release Announcing Array to Regain Rights to Binimetinib

 

2



 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: December 3, 2014

Array BioPharma Inc.

 

 

 

 

 

By:

/s/ R. Michael Carruthers

 

 

R. Michael Carruthers

 

 

Chief Financial Officer

 

3



 

EXHIBIT INDEX

 

Exhibit
No.

 

Description

 

 

 

99.1

 

Press Release Announcing Array to Regain Rights to Binimetinib

 

4




Exhibit 99.1

 

 

Press Release

 

CONTACT:                               Tricia Haugeto

(303) 386-1193

thaugeto@arraybiopharma.com

 

ARRAY TO REGAIN WORLDWIDE RIGHTS TO BINIMETINIB

 

- Array to receive up to $85 million upfront payment from Novartis -

- Novartis to conduct and/or substantially fund all ongoing and several planned clinical studies, including COLUMBUS, NEMO and MILO -

- Agreement subject to Novartis-GSK transaction close -

- Conference call to discuss transaction on Thursday, December 4, 2014 at 9:00 a.m. Eastern Time -

 

Boulder, Colo., (December 3, 2014) - Array BioPharma Inc. (NASDAQ: ARRY) today announced that it has reached a definitive agreement with Novartis International Pharmaceutical Ltd. to regain full worldwide rights to binimetinib, a MEK inhibitor in three Phase 3 trials.  This agreement is conditional on the closing of transactions announced by Novartis and GlaxoSmithKline PLC (GSK) on April 22, 2014, which are expected in the first half of 2015, and remain subject to regulatory approval. Array had previously granted Novartis worldwide exclusive rights to develop and commercialize binimetinib under a 2010 License Agreement, which will terminate and be superseded by a new set of agreements between the parties.

 

“Regaining full worldwide rights to binimetinib, an innovative late-stage oncology product, represents a tremendous opportunity for Array,” said Ron Squarer, Chief Executive Officer, Array BioPharma.  “Binimetinib is currently advancing in three Phase 3 clinical trials and, we expect to file for our first regulatory approval during the first half of 2016.  With this agreement, we are in a strong position to successfully develop and commercialize binimetinib to the benefit of cancer patients.”

 

Novartis stated, “Binimetinib has demonstrated promising results for cancer patients across several different clinical trials.  We are committed to supporting a successful transition to Array.”

 

Terms of the Agreement

 

Upon deal close, Array will receive up to $85 million and Novartis’ global, exclusive license to binimetinib will terminate with all rights reverting to Array.  Novartis has agreed to provide transitional regulatory, clinical development and manufacturing services as specified below and will assign to Array patent and other intellectual property rights it owns to the extent relating to binimetinib.  All clinical trials involving binimetinib, including the COLUMBUS, NEMO and MILO pivotal trials, will continue to be conducted as currently contemplated.

 

Novartis will be responsible for continued conduct and funding of the COLUMBUS trial.  This obligation will transfer to any future owner of LGX818 (encorafenib).  Following deal close, Novartis will reimburse Array for all remaining out-of-pocket expenses and half of all remaining fully-burdened full time equivalent (FTE) costs associated with MILO, which Array will continue to conduct.  For NEMO and all other ongoing and planned clinical trials, Novartis will conduct and solely fund each trial, until a mutually agreed-upon transition date to Array.  Following this transition, Novartis will reimburse Array for all remaining out-of-pocket expenses and half of all remaining fully-burdened FTE costs required to complete these studies.

 



 

Novartis will remain responsible for conducting and funding development of the NRAS melanoma companion diagnostic until Premarket Approval is received from the U.S. Food and Drug Administration.  Following approval, Novartis will transfer the product and Premarket Approval to a diagnostic vendor of Array’s designation.

 

Novartis also retains binimetinib supply obligations for all clinical and commercial needs for up to 30 months after closing and will also assist Array in the technology and manufacturing transfer of binimetinib.  Novartis will also provide Array continued access to several Novartis pipeline compounds including, but not limited to, LEE011 (CDK 4/6 inhibitor) and BYL719 (α-PI3K inhibitor), for use in currently ongoing combination studies, and possible future studies, including Phase 3 trials, with binimetinib.

 

Conference Call Information

 

Array will hold a conference call on Thursday, December 4, 2014 at 9:00 a.m. Eastern Time to discuss this announcement.  Ron Squarer, Chief Executive Officer, will lead the call.

 

Date:

Thursday, December 4, 2014

Time:

9:00 a.m. Eastern Time

Toll-Free:

(800) 708-4540

Toll:

(847) 619-6397

Pass Code:

38529167

Webcast, including Replay and Conference Call Slides: 

http://investor.arraybiopharma.com/phoenix.zhtml?c=123810&p=irol-EventDetails&EventId=5176145

 

About MEK and Binimetinib

 

MEK is a key protein kinase in the RAS/RAF/MEK/ERK pathway, which regulates several key cellular activities including proliferation, differentiation, migration, survival and angiogenesis. Inappropriate activation of this pathway has been shown to occur in many cancers, in particular through mutations in BRAF, KRAS and NRAS.  Binimetinib is a small-molecule MEK inhibitor that targets a key enzyme in this pathway.  Three Phase 3 trials with binimetinib in advanced cancer patients continue to enroll: NRAS-mutant melanoma (NEMO), low-grade serous ovarian cancer (MILO) and BRAF-mutant melanoma (COLUMBUS).  NRAS-mutant melanoma represents the first potential indication for binimetinib, with a projected regulatory filing estimated in the first half of 2016.

 

About Array BioPharma

 

Array BioPharma Inc. is a biopharmaceutical company focused on the discovery, development and commercialization of targeted small molecule drugs to treat patients afflicted with cancer.  Six Phase 3 studies on Array invented drugs, binimetinib (partnered with Novartis) and selumetinib (partnered with AstraZeneca), are currently enrolling patients with cancer. For more information on Array, please go to www.arraybiopharma.com.

 

Forward-Looking Statement

 

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about the closing of the transaction with Novartis, the timing of the completion or initiation of further development of binimetinib, expectations that the return of rights to binimetinib to Array and other events will occur that will result in greater value for Array, the potential for the results of ongoing preclinical and clinical trials to support regulatory approval or the marketing success of a drug candidate, future plans to progress and develop binimetinib, and our plans to build a commercial-stage biopharmaceutical company. These statements involve significant risks and uncertainties, including those discussed in our most recent annual report filed on Form 10-K, in our quarterly reports filed on Form 10-Q, and in other reports filed by Array with the Securities and Exchange

 



 

Commission. Because these statements reflect our current expectations concerning future events, our actual results could differ materially from those anticipated in these forward-looking statements as a result of many factors. These factors include, but are not limited to, our ability to continue to fund and successfully progress our proprietary drugs; our ability to effectively and timely conduct clinical trials in light of increasing costs and difficulties in locating appropriate trial sites and in enrolling patients who meet the criteria for certain clinical trials; risks associated with our dependence on third-party service providers to successfully conduct clinical trials within and outside the United States; our ability to achieve and maintain profitability and maintain sufficient cash resources; and our ability to attract and retain experienced scientists and management. We are providing this information as of December 3, 2014. We undertake no duty to update any forward-looking statements to reflect the occurrence of events or circumstances after the date of such statements or of anticipated or unanticipated events that alter any assumptions underlying such statements.

 

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