| Item 1.01. | Entry into a Material Definitive Agreement. |
On September 10, 2021, REGENXBIO Inc. (the “Company”) entered into a Collaboration and License Agreement with AbbVie Global Enterprises Ltd. (the “Partner”), a subsidiary of AbbVie Inc., to develop and commercialize RGX-314, a potential one-time gene therapy for the treatment of wet age-related macular degeneration (“wet AMD”), diabetic retinopathy (“DR”) and other chronic retinal diseases (the “Collaboration and License Agreement”). The Collaboration and License Agreement will become effective upon the satisfaction of customary closing conditions, including the expiration or termination of the applicable waiting or suspension period under the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended, and any other applicable competition laws.
Pursuant to the Collaboration and License Agreement, the parties will conduct certain activities for the development of products containing RGX-314 (“Licensed Products”) under a development plan determined in accordance with the Collaboration and License Agreement. In the United States, the parties are required to use commercially reasonable efforts to develop one Licensed Product for the treatment of each of (a) wet AMD utilizing suprachoroidal delivery, (b) wet AMD utilizing subretinal delivery and (c) DR and, (d) following the achievement of specified milestone events, one Licensed Product for the treatment of an additional indication. In specified markets outside the United States, the Partner is required to use commercially reasonable efforts to develop one Licensed Product for each such indication. Through December 31, 2022, the Company will be responsible for development expenses for certain ongoing trials of RGX-314 and the parties will share additional development expenses related to RGX-314. Beginning on January 1, 2023, the Partner will be responsible for the majority of all development expenses.
The Company will lead the manufacturing of RGX-314 for clinical development and U.S. commercial supply, and the Partner will lead manufacturing of RGX-314 for commercial supply outside the United States. Manufacturing expenses will be allocated between the parties in accordance with the terms of the Collaboration and License Agreement and mutually agreed supply agreements. In the United States, the Company shall participate in commercialization of Licensed Products to the extent set forth in a commercialization plan to be determined in accordance with the Collaboration and License Agreement, and the parties will equally share net profits and net losses associated with commercialization of the Licensed Products in the United States. Outside the United States, the Partner will be responsible, at its sole cost, for the commercialization of Licensed Products.
The Company will receive an upfront payment of $370.0 million from the Partner. Additionally, the Company will be eligible to receive up to $1.38 billion in development, regulatory and commercial milestone payments, in the aggregate, for the achievement of specified milestones for Licensed Products, of which $782.5 million are based on development and regulatory milestones, with the remainder based on commercial milestones. The Company will also be eligible to receive tiered royalties on net sales by the Partner of Licensed Products outside the United States at percentages in the mid-teens to low twenties, subject to specified offsets and reductions. Royalties will be payable on a product-by-product and country-by-country basis outside the United States commencing on the date of first commercial sale of each Licensed Product, and ending on the later of (a) expiration of all valid claims of specified licensed patents in such country, (b) expiration of regulatory exclusivity in such country and (c)(x) if such country is in the European Union, 12 years following first commercial sale of such product in such country, or (y) if such country is outside the European Union, 10 years following the first commercial sale of such product in such country (the “Royalty Term”).
The Collaboration and License Agreement will remain in effect, unless earlier terminated, on a country-by-country basis until (a) in the case of the United States, the later of (i) the 120th day after any quarter in which no Licensed Product is being developed or commercialized under such agreement, and (ii) the date that specified licensed patents for a Licensed Product expire in the United States, and (b) in the case of any country outside the United States, the date the Royalty Term for a Licensed Product expires in such country.
The Collaboration and License Agreement contains provisions for termination by (a) the Company upon a challenge of certain licensed patents specified in the Collaboration and License Agreement by the Partner, (b) either party for an uncured material breach of such agreement, (c) the Partner for convenience, (d) the Partner for safety reasons, and (e) either party upon the insolvency of the other party. Additionally, the Collaboration and License Agreement contains, among other provisions, customary representation and warranties, indemnification obligations and confidentiality and intellectual property provisions.
The foregoing description of the terms of the Collaboration and License Agreement does not purport to be complete and is qualified in its entirety by the full text of such agreement. The Company intends to file a copy of the Collaboration and License Agreement with its Quarterly Report on Form 10-Q for the quarter ending September 30, 2021.
| Item 7.01. | Regulation FD Disclosure. |
The Company and AbbVie Inc. issued a joint press release on September 13, 2021, announcing the entry into the Collaboration and License Agreement, which is attached hereto as Exhibit 99.1 and incorporated herein by reference.
