Precision BioSciences Completes License Deal with TG Therapeutics for Cell Therapy Azer-Cel in Treatment of Autoimmune Diseases
- Strategic transaction with TG Therapeutics, Inc. to develop Azercabtagene Zapreleucel for autoimmune diseases
- Upfront and near-term payments of $17.5 million, with potential for up to $288 million in other development milestone payments
- Expected extension of cash runway into the first half of 2026
- None.
Insights
The agreement between Precision BioSciences and TG Therapeutics represents a strategic licensing transaction with significant financial implications. The upfront payment of $17.5 million, combined with the potential for up to $288 million in milestone payments, offers a substantial infusion of capital into Precision. This capital injection is expected to extend Precision's cash runway into the first half of 2026, which is crucial for a biotech firm as it allows for sustained R&D without the immediate need for additional fundraising.
Investors should note the premium price of $0.77 per share for the purchase of Precision common stock by TG Therapeutics, which is double the 30-day VWAP. This premium indicates TG Therapeutics' confidence in Precision's technology and future prospects. Additionally, the deal structure, which includes equity investment and milestone payments, aligns the interests of both companies towards the successful development and commercialization of the therapies.
From a financial perspective, the royalties on net sales, ranging from high-single-digit to low-double-digit percentages, provide a long-term revenue stream contingent on the commercial success of the therapies. This deal not only bolsters Precision's immediate financial position but also potentially adds long-term value for shareholders.
The licensing of Azercabtagene Zapreleucel (azer-cel) for autoimmune diseases to TG Therapeutics is a strategic move by Precision BioSciences to leverage its ARCUS platform outside of its core focus on oncology. By partnering with a company that has demonstrated success in the multiple sclerosis space, Precision is tapping into the growing field of immunology and expanding the potential applications of its allogeneic CAR T assets.
The biotech industry often sees high valuations for innovative therapies that address unmet medical needs. The potential for azer-cel in autoimmune diseases, a market with significant demand, could represent a considerable opportunity. The strategic shift to focus on in vivo gene editing, specifically the PBGENE-HBV and PBGENE-PMM programs, aligns with industry trends towards precision medicine and could position Precision as a leader in this space if clinical outcomes are favorable.
It is also noteworthy that Precision is actively seeking partners for other non-core assets, which could lead to additional collaborations or licensing agreements. This business model of externalizing non-core assets while focusing on proprietary technology development is common in the biotech industry and can be an effective way to manage R&D costs and mitigate risk.
The deal between Precision BioSciences and TG Therapeutics includes complex legal arrangements that encompass licensing, equity investment and milestone payments. These arrangements are typical in the biotechnology sector, where collaboration agreements often involve a mix of immediate financial compensation and future payments tied to clinical, regulatory and commercial successes. The structure of such deals is critical to ensure that both parties have legally enforceable rights and obligations that align with their business interests and protect their intellectual property.
The licensing of azer-cel for autoimmune diseases involves granting TG Therapeutics exclusive rights to develop and commercialize the therapy outside of cancer. This necessitates a thorough understanding of patent law, as the underlying technology must be adequately protected across different jurisdictions. Furthermore, the agreement likely contains provisions related to regulatory compliance, as drug development is heavily regulated by entities like the FDA and any missteps could lead to significant legal and financial repercussions.
Lastly, the equity investment aspect of the deal, where TG Therapeutics is purchasing Precision common stock at a premium, requires adherence to securities regulations. This ensures that all disclosures and transactions are conducted in accordance with the law, protecting both companies and their shareholders.
- Precision to Receive
- Upfront Cash and Near-Term Payments Expected to Extend Precision’s Cash Runway into the First Half of 2026 and Fund Precision’s Wholly-Owned In Vivo Gene Editing Programs Through PBGENE-HBV and PBGENE-PMM Phase I Clinical Data
“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
“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
Although it has not finalized its full financial results for the year ended December 31, 2023, Precision expects to report that it had approximately
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.
About Precision BioSciences, Inc.
Precision BioSciences, Inc. is an advanced gene editing company dedicated to improving life (DTIL) with its novel and proprietary ARCUS® genome editing platform that differs from other technologies in the way it cuts, its smaller size, and its simpler structure. Key capabilities and differentiating characteristics may enable ARCUS nucleases to drive more intended, defined therapeutic outcomes. Using ARCUS, the Company’s pipeline is comprised of in vivo gene editing candidates designed to deliver lasting cures for the broadest range of genetic and infectious diseases where no adequate treatments exist. For more information about Precision BioSciences, please visit www.precisionbiosciences.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements regarding the clinical development and expected safety, efficacy and benefit of our product candidates (including azer-cel) and gene editing approaches including editing efficiency and differentiating aspects; the suitability of azer-cel for oncology indications and non-oncology indications including immunological diseases; the suitability of ARCUS nucleases for gene insertion, large gene deletion, and other gene editing approaches; the expected timing of regulatory processes; expectations about our operational initiatives and business strategy; expectations around partnership opportunities; our expected cash runway; expectations about achievement of key milestones and receipt of any milestone, royalty, or other payments; expectations regarding our liquidity and capital resources; and anticipated timing of initial clinical data. In some cases, you can identify forward-looking statements by terms such as “aim,” “anticipate,” “approach,” “believe,” “contemplate,” “could,” “estimate,” “expect,” “goal,” “intend,” “look,” “may,” “mission,” “plan,” “possible,” “potential,” “predict,” “project,” “pursue,” “should,” “target,” “will,” “would,” or the negative thereof and similar words and expressions.
Forward-looking statements are based on management’s current expectations, beliefs and assumptions and on information currently available to us. These statements are neither promises nor guarantees, and involve a number of known and unknown risks, uncertainties and assumptions, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various important factors, including, but not limited to, our ability to become profitable; our ability to procure sufficient funding to advance our programs; risks associated with our capital requirements, anticipated cash runway, requirements under our current debt instruments and effects of restrictions thereunder, including our ability to raise additional capital due to market conditions and/or our market capitalization; our operating expenses and our ability to predict what those expenses will be; our limited operating history; the progression and success of our programs and product candidates in which we expend our resources; our limited ability or inability to assess the safety and efficacy of our product candidates; the risk that other genome-editing technologies may provide significant advantages over our ARCUS technology; our dependence on our ARCUS technology; the initiation, cost, timing, progress, achievement of milestones and results of research and development activities and preclinical and clinical studies, including clinical trial and investigational new drug applications; public perception about genome editing technology and its applications; competition in the genome editing, biopharmaceutical, and biotechnology fields; our or our collaborators’ or other licensees’ ability to identify, develop and commercialize product candidates; pending and potential product liability lawsuits and penalties against us or our collaborators or other licensees related to our technology and our product candidates; the
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Investor and Media Contact:
Mei Burris
Senior Director of Finance and Controller
Mei.Burris@precisionbiosciences.com
Source: Precision BioSciences, Inc.
FAQ
What is the strategic transaction that Precision BioSciences, Inc. completed with TG Therapeutics, Inc.?
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