Item 1.01 Entry into a Material Definitive Agreement.
On May 28, 2021, Zai Lab Limited (the “Company”) and Mirati Therapeutics, Inc. (“Mirati”) entered into a collaboration and license agreement (the “Agreement”), pursuant to which Zai Lab (Hong Kong) Limited, a wholly-owned subsidiary of the Company (“Zai HK”), and Mirati agreed to collaboratively develop MRTX849 (adagrasib) in China, Macau, Hong Kong and Taiwan (the “Licensed Territory”). Under the Agreement, Zai HK received from Mirati the right to research, develop, manufacture and exclusively commercialize adagrasib in all indications in the Licensed Territory, with Mirati retaining exclusive rights for the development, manufacturing and commercialization of adagrasib outside the Licensed Territory and certain co-commercialization, manufacture, and development rights in the Licensed Territory.
Pursuant to the terms of the Agreement, Zai HK will pay to Mirati an upfront fee of $65.0 million plus milestone payments of up to an aggregate of $273.0 million upon the achievement of specified clinical, regulatory and sales milestones. Mirati will also be eligible to receive certain royalties at tiered percentage rates ranging from the high teens to low twenties percent on annual net sales of licensed products in the Licensed Territory, subject to reduction under specified circumstances.
The Agreement will terminate on a licensed product-by-licensed product basis and on a region-by-region basis in the Licensed Territory, upon the later to occur of (i) the date of expiration of the last valid claim covering such licensed product in such region, (ii) the date that is 10 years after the date of the first commercial sale in such region and (iii) the expiration date of any regulatory exclusivity for such licensed product in such region, or for a co-commercialized product on the date the parties agree to terminate such co-commercialization, or in its entirety upon the expiration of all payment obligations under this Agreement. Zai HK may terminate the Agreement at any time by providing 12 months’ prior notice to Mirati. Either party may terminate the Agreement upon a material breach by the other party that remains uncured or upon certain bankruptcy events. In addition, Mirati may terminate the Agreement if Zai HK challenges the licensed patent rights.
The foregoing description of the terms of the Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Agreement, which the Company intends to file as an exhibit to a subsequent periodic report or on an amendment to this Current Report on Form 8-K.
Item 7.01 Regulation FD Disclosure.
On June 1, 2021 (U.S. time), the Company issued a press release announcing the above-described transactions. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such filing or this Current Report.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
