UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO |
Commission File Number
(Exact name of Registrant as specified in its Charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
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Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐
Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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☐ |
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Accelerated filer |
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☐ |
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☒ |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b) ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of June 30, 2022, the aggregate market value of the registrant's common stock held by non-affiliates of the registrant was $
The number of shares of Registrant’s Common Stock outstanding as of March 22, 2023 was
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant’s definitive proxy statement for the annual stockholder meeting to be held in 2023 are incorporated by reference into Part III of this Annual Report on Form 10-K as noted herein. The registrant intends to file its proxy statement within 120 days after its fiscal year end.
Table of Contents
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Page |
PART I |
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Item 1. |
3 |
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Item 1A. |
40 |
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Item 1B. |
79 |
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Item 2. |
79 |
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Item 3. |
79 |
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Item 4. |
79 |
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PART II |
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Item 5. |
80 |
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Item 6. |
80 |
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Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
81 |
Item 7A. |
87 |
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Item 8. |
87 |
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Item 9. |
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure |
87 |
Item 9A. |
87 |
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Item 9B. |
88 |
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Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
88 |
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PART III |
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Item 10. |
89 |
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Item 11. |
89 |
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Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
90 |
Item 13. |
Certain Relationships and Related Transactions, and Director Independence |
90 |
Item 14. |
90 |
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PART IV |
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Item 15. |
91 |
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Item 16 |
91 |
i
Special Note Regarding Forward-Looking Statements
This Annual Report on Form 10-K contains forward-looking statements. All statements other than statements of historical facts contained in this report, including statements regarding our future results of operations and financial position, business strategy, product candidates, planned preclinical studies and clinical trials, research and development costs, regulatory approvals, timing and likelihood of success, as well as plans and objectives of management for future operations, are forward-looking statements. In some cases, forward-looking statements may be identified by words such as "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "could," "would," "expect," "objective," "plan," "potential," "seek," "grow," "target," "if," and similar expressions intended to identify forward-looking statements.
We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy short-term and long-term business operations and objectives and financial needs. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions, including risks described in the section titled “Risk Factors” set forth in Part I, Item 1A of this Annual Report on Form 10-K and in our other filings with the Securities and Exchange Commission (the "SEC"). It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this Annual Report on Form 10-K may not occur, and actual results may differ materially and adversely from those anticipated or implied in the forward-looking statements. Forward-looking statements contained in this Annual Report on Form 10-K include, but are not limited to, statements about:
We caution you that the foregoing list may not contain all of the forward-looking statements made in this Annual Report on Form 10‑K. You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as
1
required by law, we do not intend to update any of these forward-looking statements after the date of this Annual Report on Form 10-K or to conform these statements to actual results or revised expectations.
Because some of these risks and uncertainties cannot be predicted or quantified and may be beyond our control, you should read this Annual Report on Form 10-K with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect.
This Annual Report on Form 10-K contains estimates, projections and other information concerning our industry, our business and the markets for our product candidates. We obtained the industry, market and similar data set forth in this report from our own internal estimates and research and from academic and industry research, publications, surveys and studies conducted by third parties, including governmental agencies. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. While we believe that the data we use from third parties are reliable, we have not separately verified these data. Further, while we believe our internal research is reliable, such research has not been verified by any third party. You are cautioned not to give undue weight to any such information, projections and estimates.
2
PART I
Item 1. Business.
Our Company
We were incorporated in Delaware in August 2018 as a clinical-stage biopharmaceutical company developing targeted immunotherapies for cancer. THIO, our lead asset, is an investigational dual mechanism of action drug candidate incorporating telomere targeting and immunogenicity. We completed our selection process for the clinical sites for our Phase 2 study in Australia and Europe and our application to start the Phase 2 study in Australia has been approved on March 1, 2022, by the Australian Regulatory Agency - Bellberry Human Research Ethics Committee. In July 2022, the first patient was administered with THIO in our Phase 2 human trial (THIO-101) in Australia. In December 2022, regulatory authorities in three European countries, Hungary, Poland, and Bulgaria, approved the implementation of THIO-101, Phase 2 clinical trial evaluating THIO in patients with NSCLC. Patients with advanced Non-Small Cell Lung Cancer (NSCLC) will be treated first with THIO followed a few days later by the immune checkpoint inhibitor Libtayo® (cemiplimab) manufactured and commercialized by Regeneron. Cemiplimab is a fully human monoclonal antibody targeting the immune checkpoint receptor PD-1 on T-cells. Cemiplimab has been approved in the United States and the rest of the world for multiple cancer indications, including NSCLC. In February 2021, we signed a clinical supply agreement with Regeneron to receive cemiplimab at no cost, which represents a significant cost-savings for the study. In return, we have granted Regeneron exclusive development rights in combination with PD-1 inhibitors for NSCLC for the study period. Based on the clinical data we aim to generate by the THIO-101 trial, in late 2024 we plan to seek an accelerated approval of THIO in the United States for the treatment of patients with advanced NSCLC. Even if granted, accelerated approval status does not guarantee an accelerated review or marketing approval by the FDA. In addition, in the Fourth Quarter of 2023, we plan to initiate a Phase 2 clinical trial in multiple solid tumor indications of THIO administered in sequence with Anti-PD-1 or Anti-PD-L1.
We completed an initial public offering on August 1, 2022 and our shares of common stock commenced trading on NYSE
American under the ticker symbol "MAIA” on July 28, 2022. We sold 2,000,000 shares of common stock at $5 per share for
gross proceeds of $10,000,000 in the initial public offering. On August 3, 2022, we sold an additional 300,000 shares of common
stock at $5 per share for gross proceeds of $1,500,000 upon the full exercise of the underwriter’s overallotment option. After
deducting $2,406,170 for cash issuance costs, net proceeds from the initial public offering, including the overallotment, were
$9,093,830.
Our Lead Product Candidate
THIO (6-thio-dG or 6-thio-2’-deoxyguanosine) is a telomere-targeting agent currently in clinical development to evaluate its activity in NSCLC. Telomeres, along with the enzyme telomerase, play a fundamental role in the survival of cancer cells and their resistance to current therapies. THIO is being developed as a second- or later line of treatment for NSCLC for patients that have progressed beyond the standard-of-care regimen of existing checkpoint inhibitors.
In 2019, our research team discovered that THIO produced telomere modifications and disruption, which ultimately induced cancer-specific innate and adaptive immune responses against immunologically “cold” tumors or tumor types that were unresponsive to immune checkpoint inhibitors. This hypothesis was tested and demonstrated in syngeneic and humanized mouse models. THIO administered to mice in low doses and followed by an immune-checkpoint inhibiting agent, such as an anti-PD-1 or anti-PD-L1 compound, induced complete tumor regression with no tumor recurrence during the 14 weeks of observation. Further, no toxicities were reported in the tumor-free mice. These new findings were published in the highly reputable, peer-reviewed research scientific journal, Cancer Cell in July 2020. Based on these recent discoveries, a new therapeutic approach has been designed to advance THIO into a Phase 2 clinical trial (THIO-101) in patients with advanced NSCLC.
Our regulatory strategy includes a planned filing of an Investigational New Drug application (IND) with the U.S. FDA in the near future. This would allow U.S. sites to participate in the THIO-101 NSCLC trial. The human safety data generated in Australia and Europe would constitute the basis of the IND application. Although we plan to rely solely on the safety and efficacy data we generate in our own clinical trials in support of our planned NDA filing, we take added confidence in the potential tolerability of THIO in light of the fact that the THIO doses we plan to test represent a range of 4 to 40 times lower than the maximum tolerated dose tested in the earlier clinical trials sponsored by the National Cancer Institute in the 1970s. The planned THIO-101 phase 2 trial is intended to be a proof-of-concept study that may be modified depending on interim results to include both primary and secondary endpoints and be consistent with previously approved cancer treatments. In September 2022, we submitted a pre-IND meeting request to FDA to discuss, among other elements, the existing non-clinical and clinical data to support the conduct of our planned THIO-101 phase 2 trial under an IND to include patients from the United States. MAIA received feedback in-line with the proposed plans from the FDA regarding its manufacturing, preclinical and clinical development plan. MAIA also obtained guidance from the FDA on the assessment of its safety and efficacy in the THIO-101 Phase 2 trial that will be incorporated in the U.S. IND application. MAIA plans to file its U.S. IND in the first half of 2023 and commence enrolling patients in the U.S. in the second half of 2023. Based on the clinical data we aim to generate in the THIO-101 study and assuming THIO achieves its intended clinical effect with a manageable
3
safety profile at one of the doses tested in the study, we expect to seek early FDA guidance and agreement for using this clinical trial as basis for requesting an accelerated approval. The FDA instituted its Accelerated Approval Program to allow for earlier approval of drugs that treat serious conditions, and that fill an unmet medical need based on a surrogate endpoint. A surrogate endpoint is a marker, such as a laboratory measurement, radiographic image, physical sign or other measure that is thought to predict clinical benefit, but is not itself a measure of clinical benefit. The use of a surrogate endpoint can considerably shorten the time required prior to receiving FDA approval.
MAIA Biotechnology will still be required to conduct studies to confirm the anticipated clinical benefit. These studies are known as confirmatory trials. If the confirmatory trial shows that the drug actually provides a clinical benefit, then the FDA grants traditional approval for the drug. If the confirmatory trial does not show that the drug provides clinical benefit, FDA has regulatory procedures in place that could lead to removing the drug from the market. The FDA’s accelerated approval pathway, even if initially granted, does not guarantee an accelerated review or marketing approval by the FDA. The THIO-101 study protocol may need to be amended to increase the number of patients enrolled, undergo modification of the statistical analysis or change in the trial design and/or primary endpoints.
Our Science--Driven Telomere Targeting Approach
Telomeres are regions of repetitive DNA nucleotide sequences that are associated with specialized proteins at the ends of linear chromosomes in cells. THIO’s mechanism of action comprises telomere targeting and induction of anti-cancer immunogenicity. The enzyme telomerase recognizes THIO’s metabolite formed in situ and incorporates it into the structure of the cancer cell’s telomeres, creating a faulty structure, which breaks apart the telomere spatial structure. As a result, the THIO-modified telomeric structure unwinds, recognized as DNA damage, and the cancer cells die. We believe THIO transforms “cold” tumors into “hot” tumors rendering them responsive to immunotherapy (checkpoint inhibitors) and this process takes place promptly within 24 to 72 hours. We also believe we can improve the immunotherapy efficacy and we can restore the immunotherapy efficacy in patients who have progressed or developed resistance to prior immunotherapy.
Telomere maintenance is a fundamental biologic process for cell proliferation and resilience in cancer cells, and thus represents one of the key therapeutic targets for cancer treatment. Telomerase is an enzyme that is present in a majority of human cancer cells (over 85% in the aggregate), across various tumor types. In contrast, its activity is detected in less than 1% of normal cells. THIO has only been shown to be active in cancer cells that are telomerase positive (TERT+) and actively dividing. Cancer cells are constantly telomerase positive due to an uncontrolled division process, while a relatively small number of normal cells are telomerase positive only transiently. Therefore, THIO activity is expected to be highly specific to cancer cells versus normal cells. Cancer-specific disturbance of telomeric structure, mediated by telomerase, is likely to lead to disruption in the cell cycle, followed by a very rapid and telomere-length independent cell death. THIO was observed in preliminary in vitro and in vivo studies to induce cancer-specific telomere disruption, by using the enzyme telomerase which differentiates THIO from all other available cancer therapies currently in clinical use. We are also currently developing potential next-generation small molecule telomere modifying agents with the goal of identifying additional proprietary drug candidates, across multiple cancer types.
Our Second Generation Molecule Candidates
Our THIO program drives our development pipeline of second-generation telomere targeting agents. We have initiated an early-stage research and discovery program aimed at identifying new compounds capable of acting through similar mechanisms of activity as THIO, such as the targeting and modifying telomeric structures of cancer cells through cancer-cell intrinsic telomerase activity. The main objective for this program is to discover new compounds with potentially improved specificity towards cancer cells relative to normal cells and with increased anticancer activity. This program may also allow us to strengthen our patent portfolio. Our current 2nd-generation pipeline of potential telomere-targeting agents includes seven compounds that have successfully undergone in vitroinhibitory testing in five cancer models. The data from those studies showed a significantly lower 50% inhibitory concentration (IC50) for those compounds compared to THIO, as reflected in the following figure:
IC50, µM Cell Lines |
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Compound ID |
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MC38 |
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LLC |
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Hep55- 1C |
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H2081 |
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HEK293 |
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THIO(6 thio dG) |
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1.5 |
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1.6 |
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5.0 |
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0.92 |
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-* |
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Compound #5 |
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0.35 |
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0.34 |
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0.35 |
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0.34 |
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0.02 |
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Compound #6 |
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0.35 |
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0.35 |
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0.34 |
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0.34 |
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0.01 |
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Compound #11 |
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0.36 |
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0.80 |
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0.44 |
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0.35 |
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0.63 |
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Compound #12 |
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0.84 |
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0.50 |
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0.77 |
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0.35 |
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0.61 |
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IC50 is the half maximal inhibitory concentration, and it is a measure of the potency of a substance in inhibiting a specific biological or biochemical function, such as cell proliferation. Cell lines: MC38, LLC, Hep55-1C, H2081,
4
and HEK293 are Non-Small Cell Lung Carcinoma, Colorectal, Hepatocellular carcinoma, Small Cell Lung Carcinoma, and Immortalized Human Kidney cell line, respectively. *- Data unavailable
The figures below represent dose-response curves from which IC50 values were derived for second generation compounds #5 (X97848), and #12 (X97855) in HEK293 cells:
The graph below demonstrates the dose response curves for our number five next generation compound, designated as 6S-dG-dimer, in ovarian cancer-derived cell line CoC1/DDP, in comparison with cisplatin (current standard of care in this setting). The corresponding IC50 values are shown next to the plot.
In mid-January 2023, MAIA nominated one lead new molecular entity candidate (designated as MAIA-2021-20) and one back-up new molecular entity candidate (MAIA-2022-12) for further advancement into preclinical GLP-toxicity and other studies, and may advance one of these candidates into human clinical trials upon completion of the required preclinical evaluations. MAIA also has filed a broad provisional patent application covering the composition of matter for the new telomere-targeting molecules in the fourth quarter of 2022.
Although the program is in early stages and we may not be able to identify suitable compounds, we believe we will be able to create a second generation of THIO-like compounds.
OUR PIPELINE
Our pipeline includes several potential targeted immuno-oncology candidates for relapsed and refractory cancers.
5
Pipeline products are under investigation and have not been proven to be safe or effective. There is no guarantee any product will be approved in the sought-after indication or will meet the developmental milestones set forth above.
Our Strategy
Our goal is to be the leader in the discovery, development and commercialization of cancer telomere targeting agents and other similar small molecules. Our initial focus is to efficiently advance our Phase 2 clinical program with THIO in sequential combination with cemiplimab. Ultimately, our goal would be to position THIO as a patient anticancer immunity priming treatment for all immune-activating agents used in the treatment of cancer. To date, THIO has never been tested in clinical trials in combination with any check-point inhibitor. The key elements of our strategy are to:
We will face certain challenges in implementing our business strategy including, among others, the fact that earlier development of THIO was not commercially pursued. Even if THIO successfully advances through clinical studies and towards approval for use, we may face early competition from generic alternatives to THIO after expiration of any applicable regulatory exclusivities.
6
THIO Market Opportunity and Unmet Medical Need
Most cancer cells are telomerase positive (TERT+), including 73% to 100% of primary human cancers dependent upon tumor type, indicating a significant potential therapeutic utilization for THIO across most of the tumor types. We believe successful targeting of telomeres in TERT+ cancers may represent a significant potential for broad therapeutic utilization.
Tumor Type |
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TERT(+) |
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Tumor Type |
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TERT(+) |
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Non-Small Cell Lung Cancer (NSCLC) |
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78% |
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Pancreatic Cancer |
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95% |
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Colorectal (CRC) |
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82-89% |
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Small Cell Lung Cancer (SCLC) |
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100% |
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Hepatocellular Carcinoma (HCC) |
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79-86% |
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Ovarian Cancer |
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91% |
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Breast Cancer |
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88% |
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Renal Cell Carcinoma (RCC) |
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83% |
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Prostate Cancer |
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90% |
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Glioblastoma Multiforme (GBM) |
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75% |
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Bladder Cancer |
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92% |
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Neuroblastoma |
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94% |
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head & Neck Squamous Cell Carcinoma (HNSCC) |
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`86% |
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Lymphoma (high grade) |
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100% |
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Gastric Cancer |
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85% |
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Chronic Myeloid Leukemia (CML) |
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71% |
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Melanoma |
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83-86% |
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Chronic Lymphocytic Leukemia (CLL) |
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`57% |
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Cervical Cancer |
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100% |
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Acute Myeloid Leukemia (AML) |
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73% |
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Sources: A Survey of Telomerase Activity in Human Cancer – JW Shay, S Bacchetti – European Journal of Cancer, 33,5,787-791, 1997. Telomerase Active in Human Liver Tissues; H Tahara, et al; Cancer Research 55, 2734-2736 1995; Highly /aggressive Metastatic Melanoma Cell Unable to Maintain Telomere Length; N Viceconte et al; Cell Reports 2017; and Clinical Relevance of Telomerase Status and Telomerase Activity in Colorectal Cancer; T Femandez et al; PLOS one 2016
Our initial development program will focus on Non-Small Cell Lung Cancer (NSCLC), Colorectal Cancer (CRC), Hepatocellular Carcinoma (HCC) and Small Cell Lung Cancer (SCLC) in areas of clear unmet need and/or areas with deficient immunotherapy effect within each tumor type. Each tumor type and area of unmet or undermet needs represent significant clinical and commercial opportunity. We believe that THIO offers a desirable profile with significant commercial potential.
Tumor Type |
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Incidence 2020 (M) |
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Prevalence 2020 (M) |
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Mortality 2020 (M) |
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Annual Sales 2020 ($B) |
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Annual Sales 2028 ($B) |
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Non-Small Cell Lung Cancer |
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1.9 |
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2.3 |
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1.5 |
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21.0 |
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32.7 |
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Breast |
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2.3 |
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7.8 |
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0.7 |
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12.0 |
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15.0 |
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Prostate |
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1.4 |
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5.0 |
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0.4 |
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8.5 |
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12.8 |
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Colorectal |
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1.9 |
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5.2 |
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0.9 |
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8.0 |
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10.7 |
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Liver |
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0.9 |
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1.0 |
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0.8 |
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1.0 |
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5.0 |
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Small Cell Lung Cancer |
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0.3 |
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0.3 |
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0.3 |
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0.9 |
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2.3 |
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Sources: WHO; Global Data
The table below reflects the current market for check-point inhibitors because there is no current market for THIO-like molecules. The years in the indication columns on the table below signify the timing of FDA approval in the US for the clinical indications of interest. Because the key element of our strategy is to develop THIO to work in combination with check-point inhibitors, if THIO is eventually approved by the FDA for use in conjunction with check-point inhibitors, this table provides a high-level understanding of the potential market for THIO in that combination. There is no assurance, however, that any potential market for THIO would follow the current landscape for checkpoint inhibitor franchises.
Current Landscape of Checkpoint Inhibitor Franchises
Drug |
Company |
2021 Sales ($B) |
|
Indications (tumor types) |
|
NSCLC |
SCLC |
CRC |
HCC |
Year of FDA Approval |
7
KEYTRUDA(pembrolizumab) |
Merck |
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17.2 |
|
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18 |
|
2015 |
2019 |
2017 |
2018 |
OPDIVO(nivolumab) |
BMS / Ono |
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8.6 |
|
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10 |
|
2015 |
2018 |
2017 |
2017 |
TECENTRIQ(atezolizumab) |
Genentech / Roche |
|
3.5 |
|
|
5 |
|
2016 |
2019 |
|
2020 |
IMFINZI(durvalumab) |
AstraZeneca |
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2.5 |
|
|
2 |
|
2018 |
2020 |
|
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TYVYT(sintilimab) |
Eli Lilly / Innovent |
|
0.9 |
|
|
4 |
|
|
|
|
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LIBTAYO(cemiplimab) |
Regeneron |
|
0.5 |
|
|
3 |
|
2021 |
|
|
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BAVENCIO(avelumab) |
Pfizer / Merck AG |
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0.4 |
|
|
3 |
|
|
|
|
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TBD (tislelizumab) |
Novartis / BeiGene |
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0.3 |
|
|
2 |
|
|
|
|
|
JEMPERLI (dostarlimab) |
GSK |
|
0.1 |
|
|
1 |
|
|
|
|
|
TOTAL |
|
|
33.9 |
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|
|
|
|
|
|
|
Source: BioMed Tracker 2022
Intellectual Property
Our goal is to obtain, maintain and enforce patent protection wherever appropriate for our product candidates, formulations, processes, methods and any other proprietary technologies, and operate without infringing on the proprietary rights of other parties, both in the United States and in other countries. Our practice is to actively seek to obtain, where appropriate, intellectual property protection for our current product candidates and any future product candidates, proprietary information, and proprietary technology through a combination of patents, protection of proprietary know-how and trade secrets, and contractual arrangements, both in the United States and abroad. However, full patent protection may not provide us with complete protection against competitors who may seek to circumvent our intellectual property. Our success will depend on the skills, knowledge, experience and know-how of our management research and development personnel, as well as that of our advisors, consultants, and other contractors. To help protect our proprietary know-how that is not patentable, we seek to put in place appropriate internal policies for the management of confidential information requiring all our employees, consultants, advisors, and other contractors to enter into confidentiality agreements that prohibit the disclosure of confidential information, and which will require disclosure and assignment to us of the ideas, developments, discoveries, and inventions important to our business. See “Risk Factors – Risks Related to our Intellectual Property” for additional information.
We file for patents, both directly and in collaboration with our licensing partners, in the United States with counterparts in certain countries in Europe and certain key market countries in the rest of the world, thereby covering the major pharmaceutical markets.
On December 8, 2020, we entered into an amended and restated agreement (of our prior November 29, 2018 agreement) with The Board of Regents of The University of Texas System on behalf of The University of Texas Southwestern Medical Center (collectively, UTSW). Pursuant to the amended and restated agreement, which we refer to as the UTSW1 Agreement, we obtained (1) an exclusive, worldwide license to develop and commercialize the following patent families, which are generally directed to methods of using THIO and are owned and/or controlled by UTSW:
Title / PCT Application Number |
Telomerase Mediated Telomere Altering Compounds / PCT/US2014/33330 (WO2014/168947), issued in the US, MX, NZ and RU (all method of use) pending in BR, CA, CN, EP, HK and SG. |
6-Thio-2'-Deoxyguanosine (6-Thio-dG) Results in Telomerase Dependent Telomere Dysfunction and Cell Death in Various Models of Therapy-Resistant Cancer Cells / |
Use of 6-thio-dG to Treat Therapy-Resistant Telomerase positive Pediatric Brain Tumors / |
Treatment of Drug Resistant Proliferative Diseases with Telomerase Mediated Telomere Altering Compounds / PCT/US2017/023858 (WO/2017/165675), pending in the US (method of use) |
and (2) a non-exclusive worldwide license to develop and commercialize related technology rights. The UTSW1 Agreement includes an exclusive license to US patent no. 10,463,685 (expires April 8, 2034), and pending US patent application nos. 16/450,430 (having an earliest expiration of March 23, 2037, if a patent is granted), 16/304,538 (having an earliest expiration of May 26, 2037, if a patent is granted), and 16/982,979 (having an earliest expiration of March 22, 2039, if a patent is granted). All patents are method of use.
On December 23, 2020, we entered into a second agreement with UTSW, which set forth the agreement between the parties pursuant to the Company exercising its option rights in the UTSW1 Agreement and obtaining additional license rights. Pursuant this second
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license with UTSW, which we refer to as the UTSW2 Agreement, we obtained (1) an exclusive, worldwide license to develop and commercialize the following UTSW patent family:
Title / PCT Application Number |
Sequential Treatment of Cancers Using 6-Thio-dG and Checkpoint Inhibitors / PCT/US2021/022090, pending in the US and PCT (method of use) |
and (2) a non-exclusive worldwide license to develop and commercialize related technology rights. The UTSW2 Agreement includes an exclusive license to pending US patent application no. 17/200,539 (having an earliest expiration of March 12, 2041, if a patent is granted). This patent is generally directed to methods of using THIO in combination with immune checkpoint inhibitors.
We continually assess and refine our intellectual property strategy as we develop new technologies and therapeutic candidates. As our business evolves, we may, among other activities, file additional patent applications in pursuit of our intellectual property acquisition and protection strategy, to adapt to competition or to seize potential opportunities.
Our Team
We have assembled an experienced management team with deep research, development, and commercialization experience in the areas of telomere-related science, immunotherapy, and across a vast array of oncology indications.
Key Team highlights:
We have engaged the following advisors, who are leading, internationally recognized experts in oncology, telomeres and telomerase research, to be a part of our Scientific Advisory Board (“SAB”), which provides independent non-binding scientific advice to our management team in the roles detailed below under each member’s name:
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Our SAB is primarily compensated by way of the grant of stock options as determined by the Company as appropriate in recognition of the specific services or areas of expertise of each member.
We are also supported by a seasoned board of directors, whose members have significant entrepreneurial skills in company building and corporate financing as well as decades of collective leadership and board experience.
Our Programs
Telomere Targeting Program
Targeting Telomeres via Telomerase Leads to Cancer Cell Death
Telomeres are regions of repetitive nucleotide sequences that are associated with specialized proteins at the ends of linear chromosomes, that represent a critical key therapeutic target for cancer. Telomeres are often depicted in imagery like the end of a shoelace. • Maintenance of telomeres is essential for unlimited cellular proliferation and confers immortality in cancer cells. Telomeres in human cells consist of double-stranded and single-stranded repeats of the sequence TTAGGG, which terminate in a single-stranded 3´- extension overhang of the G-rich strand. Their major function is to cap and protect the ends of chromosomes and thus to provide genetic stability. This capping function is mediated by a special architecture in which the 3´- overhang participates with telomere-binding proteins in a large loop structure called T-loop. The image on the right reflects the general location of telomeres as the end-cap of the chromosomes, which are located in the nucleus of the cell. |
|
Adapted from Transcendental Meditation and lifestyle modification increase telomerase, December 6, 2015.
|
The most successful anti-cancer drugs in the market today typically interfere with only one of the specific capabilities or “hallmarks” cancer cells use for tumor growth and progression. In contrast, our lead drug candidate, THIO, targets two major hallmark pathways:
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The chart below reflects the many different methods by which successful anti-cancer drugs might prevent tumor growth and where THIO stands in relation to the other approaches.
ch Pipeline - PLANNED STUDIES 2022 2023 2024 2025 THIOLung Cancer Colorectal Cancer Other Solid Tumors Ph 2 THIO-101 NSCLC-2L+US Accelerated approval (projected) Ph 3 TERT+ NSCLC-2L+ Ph 3 NSCLC-1LPh 2 THIO-102 TERT+ CRC-3L+ Pivotal. Ph 2 Ph 3 MSS CRC-1LPh 2 Basket TERT+ Tumors L3+Ph 3 Pivotal TBDSCLC HCC GBM Melanoma Pancreatic Ovarian Breast Prostate Ph 3 Pivotal TBD Preclinical US Potential IND
Adapted from Cell 2011, Volume 144, Issue 5, Pages 646-674 (DOI:10.1016/j.cell.2011.02.013)
Role of the Enzyme Telomerase
Telomerase is a ribonucleoprotein enzyme (reverse transcriptase) that synthesizes telomere repeats from the beginning, or de novo. In human cells, the telomerase holoenzyme consists of a high-molecular-weight complex with a template region-containing RNA subunit, hTR, and a protein component, the catalytic subunit human telomerase reverse transcriptase (hTERT). In most normal somatic cells, telomerase activity is absent and telomere repeats are lost with cell division and with aging. Telomerase is especially important in fetal tissues, reproductive cells and other tissues where extensive cell proliferation is necessary. However, most adult normal tissues are telomerase silent. Telomere attrition, beyond a certain threshold, results in the uncapping of chromosome ends, which subsequently induces DNA damage and onset of replicative senescence. In contrast, about 73% to 100% of all cancer cells in most tumor types have detectable telomerase activity, which leads to the stabilization of telomeres and allows for unlimited growth potential along with disease progression. Successful targeting of telomerase positive (TERT+) cancers represents a significant potential for therapeutic utilization in almost all tumor types.
Since most cancer cells are reliant on telomerase for their survival, and telomerase is undetectable or only transiently present at low levels in normal cells, telomeres of cancer cells and telomerase are attractive targets for the development of new cancer therapeutics. “Proof of Principle” for validation of telomere structural integrity-targeting as a therapeutic concept was demonstrated in vitro in human tumor cells using dominant negative mutant forms of hTERT. In these experiments, telomerase activity was abolished, which was associated with continuous telomere shortening, subsequently leading to the cancer cells death. Research has also indicated that cancer cell specific anti-telomeres and anti-telomerase therapies may have fewer side effects than more traditional treatments, such as chemotherapy or radiotherapy. This has made anti-cancer therapies based on telomerase inhibition an area of interest in medicine. However, attempts to directly target telomerase in clinical trials have not yet produced an approved drug, as these efforts have encountered material limitations primarily due to increased toxicities that may result from the long lag period between initiation of anti-telomerase treatment and its therapeutic effects.
Differentiated Activity of THIO, a Telomere-Targeting Agent
THIO (6-thio-2’-deoxyguanosine or 6-thio-dG) is a small molecule telomere targeting agent that uses the enzyme telomerase for DNA integration predominantly in the telomeric structure. Based on pre-clinical studies, THIO’s telomere targeting activity is believed to be primarily cancer-specific in tumor cells with active telomerase, but not in normal cells. Based on our extensive review of publicly-available information, to our knowledge THIO’s direct telomere targeting action utilizing telomerase is different from other commercially available cancer therapies and those currently in publicly disclosed clinical trials. Telomeres, along with the enzyme
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telomerase, play a fundamental role in the survival of cancer cells and their resistance to current therapies. The statements above are not intended to give any indication that THIO has been proven effective or that it will receive regulatory approval.
In non-clinical studies, published initially in 2014 along with subsequent studies, THIO was found to be converted, in cells, into the substrate recognized by telomerase, and then incorporated into telomeres of the cancer cells. Once incorporated, THIO compromised the cancer cell’s telomere structure and function, leading to “uncapping” of the telomeres, induction of DNA damage responses, and rapid cancer cell death. These profound structural modifications of cancer cell telomeres were irreparable. In both in vitro and in vivo studies, THIO showed a very prompt effect, causing telomere uncapping and leading to cancer cell death, independent of the initial tumor telomere length.
The above graphic represents an established method of action from previously conducted research in rodents that forms the scientific rationale for further clinical studies, but has not yet been tested in humans.
In 2019, further non-clinical research in syngeneic and humanized mouse models of telomerase-expressing cancers uncovered previously unknown telomere targeting activity of THIO specifically resulting from its breakdown of cancer cells. The THIO-containing DNA fragments, resulting from THIO telomere disruption, are packed into micronuclei and are released from the treated cancer cell into the blood stream, which enhances immune responses. An immune response was observed, attributed to stimulation of the cGAS/STING pathways in the host APCs (Dendritic Cells, pDCs), as well as activation of NK cells and CD 8+ and CD 4+ lymphocytes in vivo. At the same time as the T-cells activation, THIO treatment reduced levels of myeloid-derived suppressor cells (MDSCs) in the tumor micro-environment (TME), which is considered important for an anticancer immune response. While THIO activated CD8+ T cells, it also increased the total number of CD8+ T cells and upregulated PD-1 expression in the CD8+ T cells on per cell basis in the mouse model. This research demonstrated how the THIO-produced telomere stress may have the potential to increase innate sensing and adaptive anti-tumor immunity. In short, this immune system stimulation and TME remodeling proceeded in a specific antigen-dependent manner and induced adaptive immune responses that eradicated remaining cancer cells in vivo.
The above noted recent studies in a humanized mouse model also supported the hypothesis that sequential administration of THIO followed by an anti-PD-L1type of checkpoint inhibitor may overcome resistance to checkpoint blockade in advanced cancer models, suggesting that the combination therapy could benefit PD-L1-resistant patients.
Administration of low doses of THIO, aimed to activate the immune system via THIO-induced telomeric DNA modification, followed by checkpoint inhibitor therapy (anti-PD-L1 or anti-PD1), eliminated advanced tumors in preclinical models with confirmation of cancer cell type specific immune memory. This potential for THIO to induce immune memory, if confirmed in human clinical trials, would be a distinct feature of THIO’s mechanism of action, offering the possibility that the immune system may continue to be active against the cancer cells over extended periods of time, potentially reducing the need for additional treatment.
These pre-clinical results provided the basis for our new clinical therapeutic strategy for sequentially administering THIO as a telomere-targeted agent first, to activate the immune system against the specific cancer, followed by immunotherapy or other immune-activating therapy.
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Limitations of Other Therapeutic Approaches
In contrast to THIO, which targets telomeres, a challenge for the potential clinical application of pharmaceutically useful telomerase inhibitors (e.g., Imetelstat), is the therapeutic window (the range of dosage of a drug or of its concentration in a bodily system that provides safe effective therapy) and the often-observed delay between initiation of treatment and phenotypic response (called the “lag period”). Since the antiproliferative effect of any direct telomerase inhibitor is dependent on the telomere length of any given tumor cell, clinical response will be delayed until the telomeres become critically short, and thus can no longer protect the chromosomes, and as a result, the cancer cell dies. This requires a significant number of cell divisions to become apparent, and treatment may have to be given continuously for weeks to months, potentially in conjunction with other treatment modalities, to achieve an appropriate level of efficacy.
THIO: A Telomere Targeting Agent
Background
THIO (6-thio-2’-deoxyguanosine) is a synthetically-modified small molecule nucleoside that was originally designed to be an improved chemotherapy drug developed to work around purine analog resistance, which was standard-of-care therapy in the 1970s. Sponsored by the National Cancer Institute, THIO was extensively investigated in at least 19 clinical trials with over 600 cancer patient subjects (adult and pediatric) treated, both as monotherapy or in combination with other commonly used standard agents of the time. See “THIO Clinical Trials” below for more information about these trials. A traditional treatment strategy was used where patients were treated to maximum tolerated dose (MTD), a common approach for cancer therapy drug development. Although study results were promising, development was abandoned in favor of other therapies.
The previous human experience presents significant limitations as it dates to the 1970s and early 1980s when the implementation of ICH Good Clinical Practices was not yet in effect. The published studies did not disclose certain data points in line with the current ICH Good Clinical Practices, such as efficacy endpoints and serious adverse events, whether those endpoints were reached, whether the data was found to be statistically significant and serious adverse events. Further, we do not know whether those prior studies were powered for statistical significance in the way our planned studies will be powered, based generally on the results of these prior human studies, we believe that THIO has a well-established safety profile, which we intend to independently demonstrate through our own clinical studies. Moreover, all prior studies were conducted primarily in heavily pre-treated, refractory patients.
Further detailed analysis of the body of prior THIO research indicates researchers were not aware of three key factors, which if they had been known at the time, may have impacted the decision to cease development. These factors have only been discovered since 2014 (with the most recent in 2019), as illustrated in the following graphic:
Telomeres are vital DNA-structures discovered by Jack Szostak’s laboratory, for which he received the Nobel Prize in 2009, which are present at the ends of each chromosome which protect the genome from degradation, unnecessary recombination, repair, and interchromosomal fusion. Telomeres, along with the enzyme telomerase, are both crucial for the survival of cancer cells. Telomerase was discovered by Elizabeth Blackburn and Carol Greider, who shared the Nobel Prize with Jack Szostak in 2009.
THIO is believed to selectively target telomerase positive (TERT+) cancer cells, where the enzyme is activated, versus normal cells. 73% to 100% of primary human cancers are TERT+ dependent upon tumor type, indicating a significant potential therapeutic utilization for THIO in almost all tumor types. THIO’s cancer-specific disturbance of telomeric structure by telomerase leads to disruption in the cell cycle, followed by rapid cell death. Based on extensive review of publicly-available information, THIO’s direct telomere targeting action utilizing telomerase is different from other commercially available cancer therapies and those currently in publicly disclosed clinical trials.
In 2019, the MAIA research team showed that in mouse models THIO-produced telomere modification and disruption induced cancer-specific innate and adaptive immune response against immunologically “cold” or unresponsive tumor types. When THIO was administered at low doses, in syngeneic and humanized mouse models of telomerase-expressing cancers, followed by a break to allow for the activation of the immune system against the specific cancer, then followed by a standard-of-care immunotherapy agent like a check point inhibitor (CPI), either PD-1 or PD-L1, complete tumor regression was observed, with no observed toxicities. These effects have been replicated in multiple preclinical models, utilizing all leading checkpoint inhibitors or radiation therapy.
Based on these studies, we hypothesized that THIO, administered in advance of immune-activating therapies (e.g., checkpoint inhibitors, radiation therapy, etc.), at dose levels significantly lower than the levels evaluated in previous clinical trials, will “prime”
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the tumor environment and initiate an overall anti-tumor immune response. This represents an entirely new therapeutic approach for THIO and forms the basis for the new clinical strategy for planned future trials.
THIO Preclinical Development
The following summarizes the relevant preclinical studies. Extensive preclinical studies have been performed to validate THIO’s primary mechanism of action: targeting telomeres directly and causing cancer cell death via telomerase-mediated DNA damage.
To our knowledge, THIO alone has shown significant telomere targeting activity in numerous non-small cell lung cancer (NSCLC) and multiple other cancer-based cell lines in vitro and in vivo, including but not limited to small cell lung cancer (SCLC), melanoma, colorectal cancer (CRC), glioblastoma multiforme (GBM), diffuse intrinsic pontine glioma (DIPG), neuroblastoma, pancreatic, hepatocellular carcinoma (HCC), as well as head and neck cancer, breast cancer and prostate cancer.
In vitro: in summary, EC50 values (the concentrations at which half of the total number of cancer cells are dead) were approximately 0.4 µM to 1.5 µM. THIO was not cytotoxic in normal, untransformed telomerase-negative cells at concentrations up to 100 µM.
In vivo: in summary, the doses that resulted in cancer cell death were in the range of 2.5 - 5.0 mg/kg, depending on the tumor type and the schedule of the drug administration ranging from 1 to 3 days per cycle.
In March 2022, the U.S. Food and Drug Administration (FDA) granted Orphan Drug Designation (ODD) to THIO for the treatment of hepatocellular carcinoma, and in May 2022, the FDA granted ODD to THIO for the treatment of small cell lung cancer. The FDA’s Office of Orphan Products Development may grant orphan designation status to drugs and biologics that are intended for the treatment, diagnosis or prevention of rare diseases, or conditions that affect fewer than 200,000 people in the U.S. Orphan Drug Designation provides certain benefits, including financial incentives, to support clinical development and the potential for up to seven years of market exclusivity for the drug for the designated orphan indication in the U.S. if the drug is ultimately approved for its designated indication.
THIO in Sequential Administration in Advance of Checkpoint Inhibitors (CPIs) Therapy
In vivo, THIO, at 3 mg/kg/dose, (which corresponds to a 20 mg/patient/day low-dose), administered followed by a one-day break, followed by an immune checkpoint inhibitor (either anti-programmed cell death protein 1 (PD-1) or anti-programmed death ligand 1 (PD-L1) products), resulted in complete tumor regression in NSCLC and CRC syngeneic mouse tumor models.
At this low dose, THIO was able to transform immunologically “cold’ tumors, (tumors that do not respond to the CPI treatment), into immunologically “hot” tumors, which then responded well to the following sequential treatment with a CPI. These potent anti-tumor phenotypic effects were also accompanied by the efficient induction of the tumor-specific CD8+ cells, as well as CD4+, and natural killer (NK)-cells (Mender, 2020b).
These responses were achieved through telomerase-dependent and cancer cell specific activation of a) DNA damage responses, and b) cGAS/STING pathways by THIO. This body of research represents the basis for the new immune-activation treatment strategy.
The following represents key highlights from THIO preclinical research:
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Mender I. et al., Cancer Discovery (2015)
*TIF – telomere damages induced foci
*TRF2 – protein associated with telomeres
* Gamma-H2AX – protein associated with induction of DNA damage
*CRC – colorectal cancer
*hTERT – protein components of telomerase enzyme
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*i.p. – intraperitoneal injection
*IL-2 – cytokine interleukin 2
*IFN-a – interferon alfa
*TIF – telomere damage induced foci
*MB004 – brain cancer cell line
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Moreover, due to the cGAS/STING activation caused by THIO, telomere targeting activity was observed in numerous preclinical tumor models when THIO was administered followed by immune activating therapy such as immune checkpoint inhibitors (anti-PD-L1 or anti-PD-1 antibody). A summary of the pharmacological aspects of the investigational product and, where appropriate, its significant metabolites studied in animals, should be included. Such a summary should incorporate studies that assess potential therapeutic activity (e.g. efficacy models, receptor binding, and specificity) as well as those that assess safety (e.g., special studies to assess pharmacological actions other than the intended therapeutic effect(s)). The results of all relevant nonclinical pharmacology, toxicology, pharmacokinetic, and investigational product metabolism studies should be provided in summary form. This summary should address the methodology used, the results, and a discussion of the relevance of the findings to the investigated therapeutic and the possible unfavourable and unintended effects in humans.
It is therefore hypothesized that THIO, administered in advance of immune-activating therapies (e.g., checkpoint inhibitors, radiation therapy, etc.), at dose levels significantly lower than the levels evaluated in previous clinical trials, will “prime” the tumor
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environment and initiate an overall anti-tumor immune response. If confirmed through additional clinical studies, this could represent an entirely new therapeutic approach for THIO and form the basis for the new clinical strategy for planned future trials.
THIO Clinical Trials
We plan to rely solely upon our self-generated clinical safety and efficacy data, if favorable, in support of our anticipated NDA filing for THIO. However, THIO, as a compound, was the subject of investigation in numerous clinical trials in the 1970s to the early-80s in a variety of solid tumors and hematological malignancies. The compound was evaluated in at least nineteen (19) Phase 1 to Phase 3 clinical trials with over 600 patients treated by major cancer institutions and cancer cooperative groups. THIO was studied in combination with common agents in use at the time, including methyl-CCNU or mitomycin, two widely used alkylating agents to treat a variety of cancers and leukemias. Studies utilizing THIO as a single agent have been published in peer-reviewed journals. As part of the existing data base of clinical experience with the drug, we expect to reference the older NCI studies in the public domain as well as reference NCI’s original IND filing in support of an IND filing, pursuant to FDA regulations.
The following tables summarize the THIO single agent peer-reviewed published data available from the previous clinical trials.
Phase 1
Study |
Tumor Type |
Regimen/Dose Schedule |
Evaluable Subjects |
Description of Observed Adverse Events |
Responses |
C76-92
|
Pediatric Acute Leukemia who received prior 6-mercaptopurine (6-MP) or 6-thioguanine |
THIO 200 to 2,250 mg/m2 given every 12 hours for 3 doses every 2 weeks
Maximum tolerated dose (MTD) was determined to be 1,750 mg/m2given every 12 hours for 3 doses every 2 weeks |
31 |
Reversible urate nephropathy, elevations of liver enzymes, nausea and vomiting, alopecia, and skin reactions |
Therapeutic Responses observed in 6/23 (26%) patients comprised of 2 complete responses and 4 partial responses |
Source: Higgins, G. R., Jamin, D. C., Shore, N. A., Momparler, R., Hartman, G. and Siegel, S. E. (1985). “Phase I evaluation of beta-2'-deoxythioguanosine in pediatric patients with leukemia.” Cancer Treat Rep 69(6): 699-701t
Phase 2 – Single Agent Studies
Protocol |
Tumor Type |
Regimen/Dose Schedule |
Evaluable Subjects |
ORR (Overall Response) |
PR (Partial Response) |
CR (Complete Response) |
Observed Adverse Events |
SEG-248 |
Total Patients |
|
117 |
27 (23%) |
11 (9%) |
16 (14%) |
Leukopenia Thrombocytopenia Skin rash Alopecia (reversible) Nausea and vomiting |
Acute Myelocytic Leukemia (AML) |
300 mg/m2 daily for 5 days |
17 |
4 (24%) |
1 (6%) |
3 (18%) |
||
400 mg/m2 daily for 5 days |
49 |
10 (20%) |
6 (12%) |
4 (8%) |
|||
Blastic transformation of chronic myelogenous leukemai (BTL) |
300 mg/m2 daily for 5 days |
11 |
3 (27%) |
- |
3 (27%) |
||
400 mg/m2 daily for 5 days |
26 |
6 (23%) |
3 (12%) |
3 (12%) |
|||
Acute Lymphocytic Leukemia (ALL) |
300 mg/m2 daily for 5 days |
4 |
2 (50%) |
- |
2 (50%) |
||
400 mg/m2 daily for 5 days |
10 |
2 (20%) |
1 (10%) |
1 (10%) |
|||
EST 4273 (ECOG) |
Colorectal (prior 5-FU chemotherapy) |
THIO 100 mg/m2 daily for 5 days every 3 weeks vs MeCCNU 175 mg/m2 every 8 weeks |
61 |
3 (5%) |
3 (5%) |
- |
Leukopenia, thrombocytopenia, nausea and vomiting |
55 |
5 (9%) |
5 (9%) |
- |
Omura, G. A., Vogler, W. R., Smalley, R. V., Maldonado, N., Broun, G. O., Knospe, W. H., et al. (1977b). “Phase II Study of beta-2'-deoxythioguanosine in adult acute leukemia. (Study SEG-248)” Cancer Treat Rep 61(7): 1379-1381 Douglass, H. O., Jr., Lavin, P. T., Woll, J., Conroy, J. F. and Carbone, P. (1978). “Chemotherapy of advanced measurable colon and rectal carcinoma with oral 5-fluorouracil, alone or in combination with cyclophosphamide or 6-thioguanine, with intravenous 5-fluorouracil or beta-2'-deoxythioguanosine or with oral 3(4-methyl-cyclohexyl)-1(2-chlorethyl)-1-nitrosourea: A Phase II-III study of the Eastern Cooperative Oncology Group (EST 4273).” Cancer 42(6): 2538-2545
The previous human experience presents significant limitations as it dates to the 1970s and early 1980s when the implementation of ICH Good Clinical Practices was not yet in effect. The published studies did not disclose certain data points in line with the current ICH Good Clinical Practices, such as efficacy endpoints and serious adverse events. , whether those endpoints were reached, whether the data was found to be statistically significant and serious adverse events. Further, we do not know whether those prior studies were powered for statistical significance in the way our planned studies will be powered. Based generally on the results of these prior
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human studies, we believe that THIO has a well-established safety profile, which we intend to independently demonstrate through our own clinical studies. Moreover, all prior studies were conducted primarily in heavily pre-treated, refractory patients.
Notwithstanding these limitations, the available data provides substantial information on the clinical experience with and clinical profile of THIO with an exposure exceeding 600 subjects (adult and pediatric) at doses significantly higher than those intended for investigation in the current program and new treatment strategy. All studies were conducted in heavily pre-treated/refractory patients, most of whom were pre-treated with other standards of care including chemotherapy.
To date, THIO has not received marketing approval in any country; therefore, there is no marketing experience to be reported.
The planned clinical trials will assess a novel THIO therapeutic strategy: - evaluate the safety and efficacy of low potentially immunogenic doses of THIO administered to activate the immune system against the tumor to be treated, followed by standard-of-care immunotherapy (checkpoint inhibitor) or other immune activating therapies.
THIO Developmental Initiatives and Objectives
Based on the existing data regarding pre-clinical information on THIO, we believe it is possible to enter the next human clinical study in the near term with the new low dose immunogenic approach with THIO. We plan to approach the FDA to request a modified toxicity requirement to allow us a reduced time and expenditure to IND in the United States, however, the FDA may not grant such request. We are currently working with experts to evaluate the extent and quality of the existing data supporting THIO and had a pre-IND meeting with the FDA for guidance in 2022.
Phase 2 and 3 Programs
Our primary short-term objective is to assess this approach in a Proof-of-Concept study outlined below.
This first study is a dose-finding, Phase 2 clinical trial evaluating both safety and efficacy of THIO sequenced with cemiplimab in patients with advanced non-small lung cancer (NSCLC) who progressed or showed no clinical benefit to first line treatment containing an immune checkpoint inhibitor. This trial, designated as THIO-101 study is our first human clinical trial to test the immune system activation demonstrated in preclinical animal models: lower doses of THIO administered prior to a checkpoint inhibitor treatment reverses drug resistance, enhance and prolong immune responses in patients with advanced lung cancer who did not respond or progressed after a prior cancer treatment which contained another immune checkpoint inhibitor.
The trial design has two primary objectives: (1) safety of THIO administered as a priming immune system agent prior to cemiplimab administration and (2) clinical efficacy of THIO using Overall Response Rate (ORR) as the primary clinical endpoint. The study is ongoing in Australia and Europe and we expect will be followed by the United States.
The following chart sets forth the design of the THIO-101 trial:
This “dose-finding” trial will assess the safety, mechanism of activity, and immune system activation of four THIO doses tested out in separate arms administered in parallel. Each dosing arm will be further evaluated for efficacy based on Overall Response Rate (ORR), Duration of Response (DoR) and Progression Free Survival (PFS) to determine to optimal (safe and effective) dose of THIO administered in sequence with cemiplimab. Additional patients may be recruited for further clinical evaluation in any of the THIO arms based on safety and clinical benefit. Each arm of the trial will enroll a minimum of 22 and up to 41 evaluable patients. Subsequently, we expect to target earlier lines of therapy (1st line) in pivotal Phase 3 confirmatory studies in NSCLC.
In September 2022, we submitted a pre-IND meeting request to FDA to discuss, among other elements, the existing non-clinical and clinical data to support the conduct of our planned THIO-101 phase 2 trial under an IND to include patients from the United States. FDA’s November 2022 feedback indicated that our protocol generally sounds reasonable, subject to certain modifications to the
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protocol and requests for additional information. We intend to incorporate FDA’s feedback and provide the requested information as part of our IND submission to FDA, which we anticipate filing in the near future.
In an effort to obtain FDA and/or EMEA approval of THIO in combination with other standard of care approved cancer immunotherapies, we will have to conduct head-to-head studies which will compare standard of care treatment alone to standard of care treatment combined with THIO. In such studies, we would have to show that THIO added to standard of care therapies adds a significant treatment benefit by slowing down tumor progression and increasing the overall survival of the cancer patients.
In addition, we are actively evaluating other regulatory strategies and pathways that have the potential to accelerate and/or expand the study of THIO administered in sequence with an immune-checkpoint inhibitor in other solid tumor indications.
In the event THIO demonstrates early clinical efficacy, we plan to expand our clinical development program in multiple tumor types and assess several regulatory approval pathways utilizing our other development programs. The clinical development plan includes the initiation of an additional “basket trial” in multiple cancer types. This study uses a special design which allows different cancer indications to be studied under the same single trial umbrella. Some of the indications considered are:
Ultimately, we envision positioning THIO as the foundational priming treatment for all immune-activating agents over time based upon THIO’s tumor-specific immune-activation approach that enables key clinical strategies that could dramatically expand the immunotherapy market.
Second Generation of Telomere Targeting Agents
We have initiated an early-stage research and discovery program aimed at identifying new compounds capable of acting through the same mechanism of action as THIO, such as targeting and modifying telomeric structures of cancer cells through cancer-cell intrinsic telomerase activity. The main objective for this program is to discover compositionally new compounds with potentially improved specificity towards cancer cells relative to normal cells, and to assess telomere targeting activity in comparison with THIO. This program may also allow us to strengthen our patent portfolio. Although the program is in early stages and we may not be able to identify suitable compounds, we believe we will be able to create or discover a second generation of THIO-like compounds.
Strategic Collaborations and Key Agreements
Through our licensing agreements with The University of Texas Southwestern Medical Center (“UTSW”), we have commercial rights to certain U.S. patents, as well as their foreign counterparts, for the use of THIO in treating telomerase-expressing lung and colon cancer cells. We are currently using this technology to study a treatment regimen comprising the use of THIO treatment followed by cemiplimab (Regeneron) treatment in NSCLC. In addition, we have licensed a number of pending U.S. and foreign patent applications from UTSW directed to other indications, and we are continuing to pursue discussions with several companies to develop other treatment regimens using THIO for additional cancer indications.
Clinical Supply Agreement with Regeneron Pharmaceuticals, Inc.
In 2021, we entered into a Clinical Supply Agreement with Regeneron Pharmaceuticals, Inc. (REGN) to supply cemiplimab for the THIO-101 study. Regeneron will contribute the drug supply without cost, which represents a significant direct cost savings for our program. In exchange, Regeneron will receive development exclusivity for NSCLC indication during the study period, which means that MAIA cannot study THIO in NSCLC with any other PD-1 antagonist (a product sub-class of immune checkpoint inhibitors). All other tumor types remain open, and we are in discussions with other pharmaceutical companies to evaluate additional agreements that may be appropriate to support the expanded development of THIO. The supply agreement will remain in force until all of the obligations of the parties’ related to the studies contemplated by the agreement are completed, or until terminated by either party. The agreement may be terminated in the event of unsafe use of cemiplimab, material breach, regulatory action or corruption.
In addition, our management believes that strong partnership interest will develop from other pharmaceutical companies who have checkpoint inhibitor franchises or those with cancer immunotherapy interest. We expect to continue discussions with several
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companies that have expressed interest and plan to expand discussions to capitalize on these opportunities. The checkpoint inhibitor market is large, and our goal is to ultimately position THIO as the foundational priming treatment to be used prior to all checkpoint inhibitors.
The University of Texas Southwestern Medical Center License Agreement 1
On December 8, 2020, we entered into an amended and restated agreement (of our prior November 29, 2018 agreement) with The Board of Regents of The University of Texas System on behalf of The University of Texas Southwestern Medical Center (collectively, UTSW). Pursuant to the amended and restated agreement, which we refer to as the UTSW1 Agreement, we obtained (1) an exclusive, worldwide license to develop and commercialize the following UTSW patent families generally directed to methods of using THIO (below) and (2) a non-exclusive worldwide license to develop and commercialize related technology rights.
Title / PCT Application Number |
Telomerase Mediated Telomere Altering Compounds / PCT/US2014/33330 (WO2014/168947) |
6-Thio-2'-Deoxyguanosine (6-Thio-dG) Results in Telomerase Dependent Telomere Dysfunction and Cell Death in Various Models of Therapy-Resistant Cancer Cells / |
Use of 6-thio-dG to Treat Therapy-Resistant Telomerase positive Pediatric Brain Tumors / |
Treatment of Drug Resistant Proliferative Diseases with Telomerase Mediated Telomere Altering Compounds / PCT/US2017/023858 (WO/2017/165675) |
Under the UTSW1 Agreement, we agreed to pay UTSW a minimal license fee, deferred license fees, milestone fees, and running royalties beginning on the first net sale (among others). For additional details regarding our relationship with UTSW, see the section entitled “Business — Intellectual Property —License Agreement 1 with The Board of Regents of The University of Texas System/The University of Texas Southwestern Medical Center.” The UTSW1 Agreement includes an exclusive license to US patent no. 10,463,685 (expires April 8, 2034), and pending US patent application nos. 16/450,430 (having an earliest expiration of March 23, 2037, if a patent is granted), 16/304,538 (having an earliest expiration of May 26, 2037, if a patent is granted), and 16/982,979 (having an earliest expiration of March 22, 2039, if a patent is granted).
The University of Texas Southwestern Medical Center License Agreement 2
On December 23, 2020, we entered into a second agreement with The Board of Regents of The University of Texas System on behalf of The University of Texas Southwestern Medical Center, which set forth the agreement between the parties pursuant to the Company exercising its option rights in the UTSW1 Agreement and obtaining additional license rights. Pursuant this second license with UTSW, which we refer to as the UTSW2 Agreement, we obtained (1) an exclusive, worldwide license to develop and commercialize the following UTSW patent family (below) and (2) a non-exclusive worldwide license to develop and commercialize related technology rights.
Title / PCT Application Number |
Sequential Treatment of Cancers Using 6-Thio-dG and Checkpoint Inhibitors / PCT/US2021/022090 |
Under the UTSW2 Agreement, we agreed to pay UTSW a minimal license fee, deferred license fees, milestone fees, and running royalties beginning on the first net sale (among others). For additional details regarding our relationship with UTSW, see the section entitled “Business — Intellectual Property —License Agreement 2 with The Board of Regents of The University of Texas System /The University of Texas Southwestern Medical Center.” The UTSW2 Agreement includes an exclusive license to pending US patent application no. 17/200,539 (having an earliest expiration of March 12, 2041, if a patent is granted).
THIO Program
License Agreement 1 with The Board of Regents of The University of Texas System /The University of Texas Southwestern Medical Center
On December 8, 2020 (the “Effective Date”), we entered into an amended and restated agreement (of our prior November 29, 2018 agreement) with The Board of Regents of The University of Texas System on behalf of The University of Texas Southwestern Medical Center, (collectively, UTSW) to develop and commercialize certain UTSW owned and/or controlled patents and related technology directed to methods of using THIO (“the UTSW1 Agreement”). The license is exclusive as to worldwide Patent Rights for all uses in the Field, which is defined as all therapeutic, prophylactic and diagnostic fields of use for all indications, including
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discovery and development uses. The license is sublicensable with prior UTSW written approval consistent with the terms of UTSW1 Agreement.
The UTSW1 Agreement includes an exclusive license to the “Patent Rights” of the worldwide patent families including all provisional applications and any divisionals, continuations, continuations-in-part and foreign counterpart applications that are entitled to claim priority thereto, and any patents resulting therefrom, of the following:
Title / PCT Application Number |
Telomerase Mediated Telomere Altering Compounds / PCT/US2014/33330 (WO2014/168947) |
6-Thio-2'-Deoxyguanosine (6-Thio-dG) Results in Telomerase Dependent Telomere Dysfunction and Cell Death in Various Models of Therapy-Resistant Cancer Cells /PCT/US2017/34706 (WO2017/205756) |
Use of 6-thio-dG to Treat Therapy-Resistant Telomerase positive Pediatric Brain Tumors /PCT/US2019/023596 (WO2019/183482) |
Treatment of Drug Resistant Proliferative Diseases with Telomerase Mediated Telomere Altering Compounds / PCT/US2017/023858 (WO/2017/165675) |
The UTSW1 Agreement also grants the Company a non-exclusive worldwide license under the Technology Rights to develop, manufacture, have manufactured, distribute, have distributed, use, offer for Sale, Sell, lease, loan and/or import Licensed Products in the Field, wherein Technology Rights means Licensor’s rights in technical information, know-how, processes, procedures, compositions, devices, methods, formulas, protocols, techniques, designs, drawings or data created before the Effective Date by Inventors at UTSW which are necessary or reasonably useful for practicing Patent Rights.
The UTSW1 Agreement also grants the Company the first right to negotiate an exclusive license under any patent rights covering or claiming any improvement, which is any patentable invention and is conceived or reduced to practice solely by Dr. Jerry Shay or those under his direct supervision at UTSW within 3 years of the Effective Date, under certain conditions.
The term of the UTSW1 Agreement begins on the Effective Date and continue until the earliest of: (i) termination pursuant to the UTSW1 Agreement, (ii) the last date of expiration or termination of the Patent Rights; or (iii) if Technology Rights are licensed and no Patent Rights are applicable, twenty (20) years after the Effective Date. The Company may terminate the UTSW1 Agreement for convenience, at any time prior by providing ninety (90) days’ written notice to UTSW. UTSW may terminate the UTSW1 Agreement if the Company (i) becomes in arrears in any payments due, and fails to make the required payment within 30 days after delivery of written notice from UTSW, (ii) is in breach of any material non-payment provision, and does not cure such breach within 60 days after delivery of written notice, (iii) UTSW delivers notice to the Company of three or more actual breaches in any 12-month period, even in the event that the Company cures such breaches in the allowed period, (iv) becomes insolvent or bankrupt, then termination is immediate.
UTSW and/or the co-owners of certain patents have reserved the right to publish the scientific findings related to the Patent Rights and use and to permit other academic institutions to use the licensed subject matter for teaching, research, education, and other education-related, non-commercial purposes. The Patent Rights are also subject to any rights of the United States federal, state and/or local Government(s), as well as nonprofit entities, if certain patents or technologies were created in the course of Government-funded or non-profit entity-funded research.
Pursuant to the UTSW1 Agreement, the Company paid to UTSW a nominal one-time upfront license fee. The Company is also obligated to pay all accrued patent expenses as well as ongoing patent expenses on a scheduled basis tied to Company fund-raising through Series A funding until Company has reimbursed all patent expenses. In the event that the Company assigns the agreement to a third party, the Company is obligated to pay UTSW an assignment fee in the mid-six figures within 15 days of such assignment. The agreement cannot be assigned without UTSW’s consent.
Under the UTSW1 Agreement, the Company is obligated to use diligent efforts to bring licensed products to market through a funded, ongoing and active research and development, manufacturing, regulatory, marketing or sales program (all as commercially reasonable) and provide semi-annual reports to UTSW on its progress. The Company is also obligated to pay agreed upon milestone payments to UTSW. Failure of the Company to fulfill these obligations may be treated as a material breach by UTSW.
The only milestones that require payments under the UTSW1 Agreement include: (i) first commercial sale in the U.S. of licensed product for treating an oncology indications ; (ii) first commercial sale in the U.S. of licensed product for treating a non-oncology indications; (iii) first time aggregate Net Sales (as defined in the UTSW1 Agreement) of licensed product for treating an oncology indications exceeds low-nine figure sales in a contract year; (iv) first time aggregate Net Sales of licensed product for treating a non-oncology indications exceeds low nine-figure sales in a contract year; (v) first time aggregate Net Sales of licensed product for treating
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an oncology indications exceeds low ten-figure sales in a contract year; (vi) first time aggregate Net Sales of licensed product for treating a non-oncology indications exceeds low ten-figure sales in a contract year. There are no milestone payments required on any development or regulatory milestones. The only required milestone payments under the UTSW1 Agreement related to commercial sales milestones, and the aggregate amount of milestone fees payable pursuant to the UTSW1 Agreement will not exceed $112 million.
The Company will also pay UTSW running royalties on a yearly basis as a percentage of Net Sales of the Company or its sublicensee. There are single digit royalty rates for licensed products and licensed services covered by a Valid Claim (as defined in UTSW1 Agreement) and dependent on whether Net Sales are greater than or less than/equal to low ten figures of sales, with Net Sales above that amount commanding a slightly higher percentage. In each case, the royalty percentage is lower before patent issuance in each jurisdiction. In the event that the licensed product or licensed service is not covered by a Valid Claim, the running royalty rates are reduced by a certain percentage. The royalty obligations continue on a country-by-country basis until the later of expiration of the last Valid Claim in each country or ten (10) years after the First Commercial Sale (as defined in UTSW1 Agreement) in each country. In the event that the Company or its sublicensee challenges the Patent Rights, then the Company will be obligated to pay multiples of the applicable royalty rate of the Net Sales and, should the outcome of such challenge determine that any claim of the Patent Rights challenged is both valid and infringed then the Company will pay royalties at the rate of multiples of the applicable royalty rate of the Net Sales sold thereafter and reimburse UTSW for all fees and costs associated with defending such challenge, including attorney’s fees and expert fees.
The UTSW1 Agreement also contains an anti-stacking provision pursuant to which in the event the Company or its sublicensee pays royalties or other payments to a third party who owns or controls intellectual property deemed necessary to develop, manufacture, have manufactured, distribute, have distributed, use, lease, loan, import, offer for sale and/or sell any licensed products and licensed services, the Company may reduce payments to UTSW by a certain percentage of the royalty, milestone or other payments paid to such third party. However, such adjustment in royalty payments to UTSW may not be reduced by more than a certain percentage of the royalty obligation in any contract year. In the event that the payment to the third party who owns or controls intellectual property deemed necessary to extend or expand the franchise or exclusivity of a previously launched licensed product (e.g., such as a new formulation as a second generation product containing the same compound as the previously launched Licensed Product), then the Company may reduce payments to UTSW by a certain percentage of the royalty, milestone or other payments paid to such third party. However, such adjustment in royalty payments to UTSW may not be reduced below a certain percentage of the royalty obligation in any contract year.
UTSW maintains direct control over the prosecution and maintenance activities of the Patent Rights, and the Company is obligated to reimburse past and ongoing patent expenses as noted above. UTSW will permit the Company to comment on submissions to government patent agencies, during prosecution and will consider the Company’s comments, but UTSW retained control over all final decisions.
The UTSW1 Agreement contains a representation that UTSW has the rights and authority to grant to Company the licensed rights and is to its knowledge unaware of any third-party infringer or any infringement of third-party intellectual property rights. The UTSW1 Agreement also requires the Company to indemnify UTSW and other related parties against any liabilities, damages, causes of action, suits, judgments, liens, penalties, fines, losses, costs and expenses arising out of any product the Company produces under the UTSW1 Agreement, and requires the Company, beginning with the earlier of the first clinical trial or commercial sale or other commercialization, to obtain liability insurance.
The Company will have the first and sole right but not the obligation, at its own expense, to initiate an infringement suit or other appropriate actions against third party infringers and monetary recovery received therefrom, after the Company is reimbursed for expenses in enforcing the Patent Rights, is shared between the Company and UTSW pursuant to a good faith negotiation between the parties at that time. If the Company does not file suit within six months after a written request by UTSW, then UTSW may bring suit to enforce any Patent Right and retain all recoveries from such enforcement. If UTSW pursues such infringement action, it may, as part of the resolution of such efforts, grant nonexclusive license rights to the alleged infringer notwithstanding Licensee’s exclusive license rights.
In accordance with the terms of the UTSW1 Agreement, on April 24, 2020 Company sublicensed all Company rights and obligations under the UTSW1 Agreement to Company affiliate THIO Therapeutics, Inc.
License Agreement 2 with The Board of Regents of The University of Texas System /The University of Texas Southwestern Medical Center
On December 23, 2020 (the “Effective Date”), we entered into a second agreement with The Board of Regents of The University of Texas System on behalf of The University of Texas Southwestern Medical Center, (collectively, UTSW), which set forth the agreement between the parties pursuant to the Company exercising its option rights in the UTSW1 Agreement and obtaining additional license rights (“the UTSW2 Agreement”). The license is exclusive as to worldwide Patent Rights for all uses in the Field,
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which is defined as all therapeutic, prophylactic and diagnostic fields of use for all indications, including discovery and development uses. The license is sublicensable with prior UTSW written approval consistent with the terms of UTSW2 Agreement.
The UTSW2 Agreement includes an exclusive license to the “Patent Rights” of the worldwide patent family including all provisional applications and any divisionals, continuations, continuations-in-part and foreign counterpart applications that are entitled to claim priority thereto, and any patents resulting therefrom, of the following
Title / PCT Application Number |
Sequential Treatment of Cancers Using 6-Thio-dG and Checkpoint Inhibitors / PCT/US2021/022090 |
The UTSW2 Agreement also grants the Company a non-exclusive worldwide license under the Technology Rights to develop, manufacture, have manufactured, distribute, have distributed, use, offer for Sale, Sell, lease, loan and/or import Licensed Products in the Field, wherein Technology Rights means UTSW’s rights in technical information, know-how, processes, procedures, compositions, devices, methods, formulas, protocols, techniques, designs, drawings or data created before the Effective Date by inventors at UTSW which are necessary or reasonably useful for practicing Patent Rights.
The terms of the UTSW2 Agreement are similar in many respects to those set forth in the UTSW1 Agreement. Pursuant to the UTSW2 Agreement, the Company paid to UTSW a nominal one-time upfront license fee. The UTSW2 Agreement recognizes the accrual of low five-figures in patent expenses relative to the Patent Rights of this agreement and provides for deferral of this fee and related ongoing patent expense fees on a schedule connected to the Company’s fundraising through Series A funding. Once the Company has raised mid seven-figures, the patent expense fees are be paid in full for all patent expenses incurred by UTSW for the Company’s licensed technologies which accrued between December 12, 2019, and the date at which the mid seven-figures has been raised. Until the Company has reimbursed all patent expenses it is obligated to report its fundraising progress to UTSW on a quarterly basis.
The milestone payments are the same as in the UTSW1 Agreement wherein the milestone fees are based solely on commercial sales milestones and are payable one time only, regardless of the number of licensed products or licensed services developed and regardless of the number of indications or patient sub-populations treated with a licensed product(s) and regardless of whether the licensed products or licensed services developed are within the rights granted by the UTSW1 Agreement or the UTSW2 Agreement. In other words, there are no milestone payments required on any development, or regulatory milestones under the UTSW1 Agreement or the UTSW2 Agreement. The only required milestone payment under the UTSW1 Agreement or the UTSW2 Agreement relate to commercial sales milestones and the aggregate amount of milestone fees payable pursuant to the UTSW1 Agreement or the UTSW2 Agreement will not exceed $112 million. In the event the Company assigns the UTSW2 Agreement to a third party, the Company is obligated to pay UTSW low six-figures within 15 days of such assignment, which is cumulative of the UTSW1 Agreement assignment fee, such that if both agreements are assigned to a third party, a total of high six-figures would be owed to UTSW. The agreement cannot be assigned without UTSW’s consent.
The Company will also pay UTSW running royalties on a yearly basis as a percentage of Net Sales of the Company or its sublicensee. There are mid-single digit royalty rates for licensed products and licensed services covered by a Valid Claim (as defined in UTSW2 Agreement) and dependent on whether Net Sales are greater than or less than/equal to low ten-figures in sales, with Net Sales above that amount commanding a slightly higher percentage. In each case, the royalty percentage is lower before patent issuance in each jurisdiction. In the event that the licensed product or licensed service is not covered by a Valid Claim, the running royalty rates are reduced by a certain percentage. The royalty obligations continue on a country-by-country basis until the later of expiration of the last Valid Claim in each country or ten (10) years after the First Commercial Sale (as defined in UTSW2 Agreement) in each country. In the event that the Company or its sublicensee challenges the Patent Rights, then the Company will be obligated to pay multiple times the applicable royalty rate of the Net Sales and, should the outcome of such challenge determine that any claim of the Patent Rights challenged is both valid and infringed then the Company will pay royalties at the rate of multiple times the applicable royalty rate of the Net Sales sold thereafter and reimburse UTSW for all fees and costs associated with defending such challenge, including attorney’s fees and expert fees.
The UTSW2 Agreement also contains an anti-stacking provision pursuant to which in the event the Company or its sublicensee pays royalties or other payments to a third party who owns or controls intellectual property deemed necessary to develop, manufacture, have manufactured, distribute, have distributed, use, lease, loan, import, offer for sale and/or sell any licensed products and licensed services, the Company may reduce payments to UTSW by a certain percentage of the royalty, milestone or other payments paid to such third party. However, such adjustment in royalty payments to UTSW may not be reduced by more than a minimum percentage of the royalty obligation in any contract year. In the event that the payment to the third party who owns or controls intellectual property deemed necessary to extend or expand the franchise or exclusivity of a previously launched licensed product (e.g., such as a new formulation as a second-generation product containing the same compound as the previously launched Licensed Product), then the Company may reduce payments to UTSW by a certain percentage of the royalty, milestone or other payments paid to such third party.
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However, such adjustment in royalty payments to UTSW may not be reduced by more than a certain percentage obligation in any contract year.
The Company has the development and reporting obligations as the UTSW1 Agreement and as with the UTSW1 Agreement, UTSW has reserved the right to publish the scientific findings related to the Patent Rights and use and to permit other academic institutions to use the licensed subject matter for teaching, research, education, and other educationally related, non-commercial purposes. The Patent Rights are also subject to any rights of the United States federal, state and/or local Government(s), as well as nonprofit entities, if certain patents or technologies were created in the course of Government-funded or non-profit entity-funded research.
The obligations and rights as to patent prosecution and defense of the Patent Rights are the same as those for the UTSW1 Agreement. The term and termination provisions of the UTSW2 Agreement is the same as the UTSW1 Agreement, however in the event that the UTSW1 Agreement is terminated for any reason, or expires, then the UTSW2 Agreement likewise is terminated or deemed to have expired.
The above description of UTSW1 Agreement and UTSW2 Agreement is just a summary and readers are referred to UTSW1 Agreement and UTSW2 Agreement, which are attached hereto as Exhibits 10.2 and 10.3 respectively, for a full and complete description of the patent expenses, milestone payments, fees and royalties payable by MAIA.
Some of our intellectual property, including the intellectual property licensed under UTSW1 and UTSW2, has been conceived or developed through government-funded research and thus may be subject to federal regulations providing for certain rights for the U.S. government or imposing certain obligations on us, such as a license to the U.S. government under such intellectual property, “march-in” rights, certain reporting requirements and a preference for U.S.-based companies, and compliance with such regulations may limit our exclusive rights and our ability to contract with non-U.S. manufacturers. See Risks Relating to Our Intellectual Property - Intellectual property discovered through government funded programs may be subject to federal regulations such as “march-in” rights, certain reporting requirements and a preference for U.S.-based companies. Compliance with such regulations may limit our exclusive rights and limit our ability to contract with non-U.S. manufacturers.
Competition
The biotechnology industry is characterized by a rapid evolution of technologies, significant competition and strong defense of intellectual property. While we believe that our platforms, technology, knowledge, experience, and scientific resources provide us with unique competitive advantages, we expect to face competition from major pharmaceutical and biotechnology companies, academic institutions, governmental agencies, and public and private research institutions, among others.
Any therapeutic candidates that we successfully develop and commercialize will compete with currently approved therapies and new therapies that may become available in the future. For example, current competitors in the non-small lung cancer indication are Merck, Regeneron, Eli Lilly and Roche. There are also many other large and small companies developing products for this indication. Key product features that, if approved, would affect our ability to effectively compete with other therapeutics include the efficacy, safety and convenience of our therapeutics, the ease of use and effectiveness of any complementary diagnostics and/or companion diagnostics, and price and levels of reimbursement.
Our competitors also include large pharmaceutical and biotechnology companies, which may be developing therapeutic candidates with mechanisms similar to our compounds or targeting the same clinical indications as our therapeutic candidates. The availability of reimbursement from government and other third-party payors will also significantly affect the pricing and competitiveness of our therapeutic candidates. Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours, which could result in our competitors establishing a strong market position before we are able to enter the market.
Many of the companies against which we may compete have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These early stage and more established competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.
Government Regulation
Government authorities in the United States, at the federal, state and local level, and in other countries, extensively regulate, among other things, the research, development, testing, manufacture, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting, marketing and export and import of products such as
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those we are developing. Any pharmaceutical candidate that we develop must be approved by the United States Food and Drug Administration, or FDA, before it may be legally marketed in the United States and by the appropriate foreign regulatory agency before it may be legally marketed in foreign countries.
United States Government Regulation
In the United States, the FDA regulates biopharmaceutical products under the Federal Food, Drug, and Cosmetic Act and the Public Health Services Act, or PHSA, and implementing regulations.
Approval Processes
The process required by the FDA before a drug or biological product may be marketed in the United States generally involves the following:
Failure to comply with the applicable U.S. requirements at any time during the product development or approval process, or after approval, may subject an applicant to administrative or judicial sanctions brought by the FDA and the Department of Justice, or DOJ, or other governmental entities, any of which could have a material adverse effect on us. These sanctions could include:
The lengthy process of seeking required approvals and the continuing need for compliance with applicable statutes and regulations require the expenditure of substantial resources. There can be no certainty that approvals will be granted.
Once a biopharmaceutical candidate is identified for development, it enters the preclinical or nonclinical testing stage. Nonclinical tests include laboratory evaluations of product chemistry, toxicity and formulation, as well as animal studies. An IND sponsor must submit the results of the nonclinical tests, together with manufacturing information and analytical data, to the FDA as part of the IND. Some nonclinical testing may continue even after the IND is submitted. In addition to including the results of the nonclinical studies, the IND will also include a protocol detailing, among other things, the objectives of the clinical trial, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated if the first phase lends itself to an efficacy determination. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day time period, places the IND on clinical hold. In this case, the IND sponsor and the FDA must resolve any outstanding concerns before clinical trials can begin. A clinical hold may occur at any time during the life of an IND and may affect one or more specific studies or all studies conducted under the IND.
Clinical trials involve the administration of the drug or biological candidate to healthy volunteers or patients having the disease being studied under the supervision of qualified investigators, generally physicians not employed by or under the trial sponsor’s control. Clinical trials are conducted under protocols detailing, among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, and the parameters to be used to monitor subject safety. Each protocol must be submitted to the FDA as part of the IND. Clinical trials must be conducted in accordance with the FDA’s good clinical practices requirements.
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Further, each clinical trial must be reviewed and approved by an independent institutional review board, or IRB, at or servicing each institution at which the clinical trial will be conducted. An IRB is charged with protecting the welfare and rights of trial participants and considers such items as whether the risks to individuals participating in the clinical trials are minimized and are reasonable in relation to anticipated benefits. The IRB also approves the informed consent form that must be provided to each clinical trial subject or his or her legal representative and must monitor the clinical trial until it is completed.
Human clinical trials prior to approval are typically conducted in three sequential Phases that may overlap or be combined:
Post-approval studies, or Phase 4 clinical trials, may be conducted after initial marketing approval. These studies are used to gain additional experience from the treatment of patients in the intended therapeutic indication and may be required by the FDA as part of the approval process.
Progress reports detailing the results of the clinical trials must be submitted at least annually to the FDA and written IND safety reports must be submitted to the FDA by the investigators for serious and unexpected adverse events or any finding from tests in laboratory animals that suggests a significant risk for human subjects. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified period, if at all. The FDA or the sponsor or its data safety monitoring board may suspend a clinical trial at any time on various grounds, including a finding that the research subjects or patients are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the drug or biologic has been associated with unexpected serious harm to patients.
Concurrent with clinical trials, companies usually complete additional animal studies and develop additional information about the chemistry and physical characteristics of the drug or biologic as well as finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the drug or biological candidate and, among other things, must include methods for testing the identity, strength, quality and purity of the final drug or biologic. Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the drug or biological candidate does not undergo unacceptable deterioration over its shelf life.
U.S. Review and Approval Processes
The results of product development, preclinical studies and clinical trials, along with descriptions of the manufacturing process, analytical tests conducted on the chemistry of the drug or biologic, proposed labeling and other relevant information are submitted to the FDA as part of an NDA or BLA requesting approval to market the product. The submission of an NDA or BLA is subject to the payment of substantial user fees; a waiver of such fees may be obtained under certain limited circumstances.
The FDA reviews for completeness all NDAs and BLAs submitted before it accepts them for filing and may request additional information rather than accepting an NDA or BLA for filing. Once the submission is accepted for filing, the FDA begins an in-depth review of the NDA or BLA.
After the NDA or BLA submission is accepted for filing, the FDA reviews the application to determine, among other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in accordance with cGMP to assure and preserve the product’s identity, strength, quality and purity. The FDA reviews a BLA to determine, among other things, whether the product is safe, pure and potent and the facility in which it is manufactured, processed, packaged or held meets standards designed to assure the product’s continued safety, purity and potency. In addition to its own review, the FDA may refer applications for novel drug or biological products or drug or biological products which present difficult questions of safety or efficacy to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an
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advisory committee, but it considers such recommendations carefully when making decisions. During the approval process, the FDA also will determine whether special marketing conditions or restrictions under a risk evaluation and mitigation strategy, or REMS, are necessary to assure the safe use of the drug or biologic. If the FDA concludes that a REMS is needed, the sponsor of the NDA or BLA must submit a proposed REMS; the FDA will not approve the NDA or BLA without a REMS, if required.
Before approving an NDA or BLA, the FDA will inspect the facilities at which the product is to be manufactured, and may also inspect facilities that provide raw materials for use in the product. The FDA will not approve the product unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. Additionally, before approving an NDA or BLA, the FDA will typically inspect one or more clinical trial sites to assure their compliance with cGCP during the conduct of studies of the subject drug. If during the review of the application the FDA identifies questions or concerns regarding the application, data, manufacturing process or manufacturing facilities, it may issue a deficiency letter which the sponsor must adequately address to the FDA’s satisfaction.
The NDA or BLA review and approval process is lengthy and difficult, and the FDA may refuse to approve an NDA or BLA if the applicable regulatory criteria are not satisfied or may require additional clinical data or other data and information. Even if such data and information is submitted, the FDA may ultimately decide that the NDA or BLA does not, in its submitted form, satisfy the criteria for approval. Data obtained from clinical trials are not always conclusive and may be susceptible to varying interpretations, which could delay, limit or prevent regulatory approval. The FDA will issue a “complete response letter” (CRL) if the agency decides not to approve the NDA or BLA. The complete response letter usually describes the specific deficiencies in the NDA or BLA identified by the FDA. The deficiencies identified may be minor, for example, requiring labeling changes, or major, for example, requiring additional clinical trials. Additionally, the complete response letter will typically include recommended actions that the applicant might take to place the application in a condition for approval. If a complete response letter is issued, the applicant may either resubmit the NDA or BLA, addressing all of the deficiencies identified in the letter, or withdraw the application.
If a product receives regulatory approval, the approval may be for more limited conditions of use than the sponsor had proposed, such as limitations to specific diseases or subsets of a disease, limited patient populations, second-line or third-line use limitations, limited dosages or other limitations which could restrict the commercial value of the product. Further, the FDA may require that certain contraindications, warnings or precautions be included in the product labeling. In addition, the FDA may require Phase 4 testing which may involve clinical trials designed to further assess a product’s safety and effectiveness and may require testing and surveillance programs to monitor the safety of approved products that have been commercialized.
Companion Diagnostics
Many drugs for cancer indications involving patient-specific genetic mutations or biomarkers are approved by FDA with limitations that the specific genetic mutation must be confirmed in each patient by use of an FDA-approved diagnostic test, commonly referred to as a “companion diagnostic.” The FDA issued a final guidance document in July 2014 addressing agency policy in relation to in vitro companion diagnostic tests. The guidance explains that for some drugs and therapeutic biologics, the use of a companion diagnostic test is essential for the safe and effective use of the product, such as when the use of a product is limited to a specific patient subpopulation that can be identified by using the test. According to the guidance, the FDA generally will not approve such a product if the companion diagnostic is not also approved or cleared for the appropriate indication, and accordingly the therapeutic product and the companion diagnostic should be developed and approved or cleared contemporaneously. The FDA has also issued a Guidance, Principles for Codevelopment of an In Vitro Companion Diagnostic Device with a Therapeutic Product (2016), which is “is intended to be a practical guide to assist therapeutic product sponsors and IVD sponsors in developing a therapeutic product and an accompanying IVD companion diagnostic,” and a Guidance, Developing and Labeling In vitro Companion Diagnostic Devices for a Specific Group of Oncology Therapeutic Products(2020), which “describes considerations for the development and labeling of in vitro companion diagnostic devices (referred to as “companion diagnostics” herein) to support the indicated uses of multiple drug or biological oncology products, when appropriate.”
As stated in its Guidance, the FDA may decide that it is appropriate to approve such a product without an approved or cleared in vitro companion diagnostic device when the drug or therapeutic biologic is intended to treat a serious or life-threatening condition for which no satisfactory alternative treatment exists and the FDA determines that the benefits from the use of a product with an unapproved or uncleared in vitro companion diagnostic device are so pronounced as to outweigh the risks from the lack of an approved or cleared in vitro companion diagnostic device. The FDA encourages sponsors considering developing a therapeutic product that requires a companion diagnostic to request a meeting with both relevant device and therapeutic product review divisions to ensure that the product development plan will produce sufficient data to establish the safety and effectiveness of both the therapeutic product and the companion diagnostic. To date, no product targeting TERT+ cancer patients has been approved by FDA, and the applicability to THIO of FDA’s Companion Diagnostics Guidance and policy is yet to be determined. If a companion diagnostic is required to be developed and approved in order to receive approval of THIO, the cost and length of time to fully develop and receive approval (if at all) of THIO may both be increased, as described in more detail in the section Risk Factors – Risks Relating
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to Government Regulation. Because the FDA’s policy on companion diagnostics is set forth only in guidance, this policy is subject to change and is not legally binding.
Expedited Development and Review Programs
The FDA has a Fast-Track program that is intended to expedite or facilitate the process for reviewing new drug and biological products that meet certain criteria. Specifically, new drug and biological products are eligible for Fast Track designation if they are intended to treat a serious or life-threatening condition and demonstrate the potential to address unmet medical needs for the condition. Fast Track designation applies to the combination of the product and the specific indication for which it is being studied. Under a Fast Track designation, the FDA may consider for review sections of the NDA or BLA on a rolling basis before the complete application is submitted, if (i) the sponsor provides a schedule for the submission of the sections of the NDA or BLA, (ii) the FDA agrees to accept sections of the NDA or BLA and determines that the schedule is acceptable, and (iii) the sponsor pays any required user fees upon submission of the first section of the NDA or BLA.
Any product submitted to the FDA for marketing approval, including those submitted under a Fast Track designation, may also be eligible for other types of FDA programs intended to expedite development and review, such as priority review and accelerated approval. Any product is eligible for priority review if it has the potential to provide safe and effective therapy where no satisfactory alternative therapy exists or the new product has the potential to offer a significant improvement in the treatment, diagnosis or prevention of a disease compared with marketed products. The FDA will attempt to direct additional resources to the evaluation of an application for a new drug or biological product designated for priority review in an effort to facilitate the review. Additionally, a product may be eligible for accelerated approval. Drug or biological products studied for their safety and effectiveness in treating serious or life-threatening illnesses and that provide meaningful therapeutic benefit over existing treatments may receive accelerated approval, which means that they may be approved on the basis of adequate and well-controlled clinical studies establishing that the product has an effect on a surrogate endpoint that is reasonably likely to predict a clinical benefit, or on the basis of an effect on a clinical endpoint other than survival or irreversible morbidity. As a condition of accelerated approval, the FDA generally requires that a sponsor of a drug or biological product receiving accelerated approval perform adequate and well-controlled post-marketing clinical studies to confirm the safety and efficacy for the approved indication. Failure to conduct such studies or conducting such studies that do not establish the required safety and efficacy may result in revocation of the original accelerated approval. In addition, the FDA currently requires as a condition for accelerated approval, pre-approval of promotional materials, which could adversely impact the timing of the commercial launch or subsequent marketing of the product. Fast Track designation, priority review and accelerated approval do not change the standards for approval but may expedite the development or approval process, and even if granted, accelerated approval status does not guarantee an accelerated review or marketing approval by the FDA.
The Hatch-Waxman Amendments and Generic Competition
Orange Book Listing
Once a drug product is approved under an NDA, the product is listed in the FDA’s publication, “Approved Drug Products with Therapeutic Equivalence Evaluations,” commonly known as the Orange Book. An NDA-approved drug product will be designated in the Orange Book as a Reference Listed Drug (RLD). Sponsors of approved NDA’s are required to list with the FDA patents whose claims cover the product’s active ingredient, formulation, or an approved method of using the drug.
Patent Term Extensions
Depending upon the timing, duration and specifics of FDA approval of the use of our therapeutic candidates, some of our United States patents may be eligible for limited patent term extension under the Hatch-Waxman Act. The Hatch-Waxman Act permits a patent restoration term of up to five years as compensation for patent term lost during product development and the FDA regulatory review process. However, patent term restoration cannot extend the remaining term of a patent beyond a total of 14 years from the product or therapeutic candidate’s approval date. The patent term restoration period is generally one half of the time between the effective date of an IND and the submission date of a NDA, plus the time between the submission date of a NDA and the approval of that application, except that the review period is reduced by any time during which the applicant failed to exercise due diligence. Only one patent applicable to an approved product or therapeutic candidate is eligible for the extension and the application for extension must be made prior to expiration of the patent. The USPTO, in consultation with the FDA, reviews and approves the application for any patent term extension or restoration. In the future, we intend to apply for restorations of patent term for some of our currently owned or licensed patents to add patent life beyond their current expiration date, depending on the expected length of clinical trials and other factors involved in the submission of the relevant NDA.
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ANDA Approval Process
The Hatch-Waxman Amendments established an abbreviated FDA approval process for generic drugs that are shown to be pharmaceutically equivalent and bioequivalent to drugs previously approved by the FDA through the NDA process. Approval to market and distribute these drugs is obtained by filing an abbreviated new drug application, or ANDA, with the FDA. An ANDA provides for marketing of a drug product that has the same active ingredients in the same strengths and dosage form as the listed drug and has been shown to be bioequivalent to the listed drug. An ANDA is a comprehensive submission that contains, among other things, data and information pertaining to the active pharmaceutical ingredient, drug product formulation, specifications and stability of the generic drug, as well as analytical methods, manufacturing process validation data and quality control procedures. ANDAs are termed abbreviated because they generally do not include preclinical and clinical data to demonstrate safety and effectiveness. Instead, a generic applicant must demonstrate that its product is bioequivalent to the innovator drug. Drugs approved in this way are commonly referred to as “generic equivalents” to the listed drug and can often be substituted by pharmacists under prescriptions written for the original listed drug.
Section 505(b)(2) NDA Approval Process
As an alternative path to FDA approval for modifications to formulations or uses of products previously approved by the FDA, an applicant may submit an NDA under Section 505(b)(2) of the FDCA. Section 505(b)(2) was enacted as part of the Hatch-Waxman Amendments to the FDCA and enables the applicant to rely, in part, on the FDA’s previous approval of a similar product, and/or published literature, in support of its application. Section 505(b)(2) permits the filing of an NDA where at least some of the information required for approval comes from studies not conducted by, or for, the applicant and for which the applicant has not obtained a right of reference. If the Section 505(b)(2) applicant can establish that reliance on FDA’s previous findings of safety and effectiveness is scientifically appropriate, it may eliminate the need to conduct certain preclinical studies or clinical trials of the new product. The FDA may also require companies to perform additional studies or measurements, including clinical trials, to support the change from the approved reference drug. The FDA may then approve the new product candidate for all, or some, of the label indications for which the reference drug has been approved or for any new indication sought by the Section 505(b)(2) applicant.
ANDA and 505(b)(2) products may be significantly less costly to bring to market than the reference listed drug, and companies that produce generic products are generally able to offer them at lower prices. Moreover, generic versions of RLDs are often automatically substituted for the RLD by pharmacies when dispensing a prescription written for the RLD. Thus, following the introduction of a generic drug, a significant percentage of the sales of any branded product or reference listed drug is typically lost to the generic product.
ANDA and 505(b)(2) NDA Patent Certification Requirements
Any applicant who files an ANDA seeking approval of a generic equivalent version of a drug listed in the Orange Book or a Section 505(b)(2) NDA referencing a drug listed in the Orange Book must certify to the FDA, as applicable, that (1) no patent information on the drug product that is the subject of the application has been submitted to the FDA; (2) such patent has expired; (3) the date on which such patent expires; or (4) such patent is invalid or will not be infringed upon by the manufacture, use or sale of the drug product for which the application is submitted. This last certification is known as a paragraph IV certification. If an ANDA is submitted to FDA with a Paragraph IV Certification, the generic applicant must also provide a “Paragraph IV Notification” to the holder of the NDA for the RLD and to the owner of the listed patent(s) being challenged by the ANDA applicant, providing a detailed written statement of the bases for the ANDA applicant’s position that the relevant patent(s) is invalid or would not be infringed. If the patent owner brings a patent infringement lawsuit against the ANDA applicant within 45 days of the Paragraph IV Notification, FDA approval of the ANDA will be automatically stayed for 30 months, or until 7-1/2 years after the NDA approval if the generic application was filed between 4 years and 5 years after the NDA approval. Any such stay will be terminated earlier if the court rules that the patent is invalid or would not be infringed. The applicant may, in certain circumstances, elect to submit a “section viii” statement with respect to a listed method of use patent, certifying that the proposed generic labeling does not contain (or carves out) any language that would infringe a method of use patented listed in the Orange Book for the RLD.
The ANDA or Section 505(b)(2) application also will not be approved until any applicable non-patent exclusivity listed in the Orange Book for the reference drug has expired as described in further detail below.
Regulatory Exclusivities
New Chemical Entity (NCE) Exclusivity
The Hatch-Waxman amendments provides a period of five years of non-patent marketing exclusivity for the first approved drug containing a new chemical entity (“NCE”) as an active ingredient. An NCE is an active moiety that has not been approved by the FDA in any other NDA. A fixed combination drug product may receive NCE exclusivity if one of its active ingredients is an NCE, but not if all of its active ingredients have previously been approved. An “active moiety” is defined as the molecule or ion responsible for the drug substance’s physiological or pharmacologic action. During the five-year exclusivity period, the FDA cannot accept for filing any ANDA or 505(b)(2) NDA seeking approval of a product that contains the same active moiety, except that the FDA may accept such
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an application for filing after four years if the application includes a paragraph IV certification to a listed patent. In the case of such applications accepted for filing between four and five years after approval of the reference drug, the 30-Month Stay of approval triggered by a timely patent infringement lawsuit is extended by the amount of time necessary to extend the stay until 7-1/2 years after the approval of the reference drug NDA.
New Clinical Trial (3-Year) Exclusivity
A drug, including one approved under Section 505(b)(2), may obtain a three-year period of exclusivity for a particular indication or condition of approval, or change to a marketed product, such as a new formulation for a previously approved product, if one or more new clinical trials (other than bioavailability studies) was essential to the approval of the application or supplemental application and was conducted/sponsored by the applicant. Should this occur, the FDA would be precluded from approving any ANDA or Section 505(b)(2) application for the protected modification until after that three-year exclusivity period has run. However, unlike NCE exclusivity, the FDA can accept an application and begin the review process during the exclusivity period.
Orphan Drug Designation and Orphan Exclusivity
Under the Orphan Drug Act, the FDA may grant Orphan Drug Designation to a therapeutic candidate intended to treat a rare disease or condition, which is generally a disease or condition that affects either (i) fewer than 200,000 individuals in the United States, or (ii) more than 200,000 individuals in the United States and for which there is no reasonable expectation that the cost of developing and making available in the United States a product or therapeutic candidate for this type of disease or condition will be recovered from sales in the United States for that product or therapeutic candidate. Orphan Drug Designation must be requested before submitting a BLA. After the FDA grants Orphan Drug Designation, the identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA. Orphan Drug Designation does not convey any advantage in or shorten the duration of the regulatory review and approval process.
If a product or therapeutic candidate that has Orphan Drug Designation subsequently receives the first FDA approval for the disease for which it has such designation, the approved product is entitled to orphan product exclusivity, which means that the FDA may not approve any other marketing applications for the same drug for the same indication, except under limited circumstances, for seven years. Orphan product exclusivity, however, could also block the approval of one of our therapeutic candidates for seven years if a competitor obtains approval of the same drug as defined by the FDA, or if our therapeutic candidate is determined to be contained within a competitor’s approved drug for the same indication or disease.
In addition, an orphan drug credit is available for qualifying costs incurred between the date the FDA designates a drug as an orphan drug and the date the FDA approves the drug.
Pediatric Exclusivity
Pediatric exclusivity is another type of non-patent marketing exclusivity available in the United States and, if granted, it provides for the attachment of an additional six months of marketing protection to the term of any existing regulatory exclusivity or listed patents. Under the Best Pharmaceuticals for Children Act, or BPCA, certain therapeutic candidates may obtain an additional six months of exclusivity if the sponsor conducts pediatric research and submits new clinical information requested in writing by the FDA, referred to as a Written Request, relating to the use of the active moiety of the product or therapeutic candidate in children. The data do not need to support a label change for pediatric use; rather, the additional protection is granted if the pediatric clinical trial is deemed to have fairly responded to the FDA’s Written Request. Although the FDA may issue a Written Request for studies on either approved or unapproved indications, it may only do so where it determines that information relating to that use of a product or therapeutic candidate in a pediatric population, or part of the pediatric population, may produce health benefits in that population. The issuance of a Written Request does not require the sponsor to undertake the described trials. This is not a patent term extension, but it effectively extends the regulatory period during which the FDA cannot approve another application.
Post-Approval Requirements
Following approval of a new drug or biologic product, the manufacturer and the approved product are subject to pervasive and continuing regulation by the FDA, including, among other things, continuing cGMP compliance, monitoring and recordkeeping activities, reporting of adverse experiences with the product, product sampling and distribution restrictions, complying with promotion and advertising requirements, which include restrictions on promoting drugs for unapproved uses or patient populations (i.e., “off-label use”) and limitations on industry-sponsored scientific and educational activities. Although physicians may prescribe legally available products for off-label uses, manufacturers may not market or promote such uses. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability. If there are any modifications to the product, including changes in indications, labeling or manufacturing processes or facilities, the applicant may be required to submit and obtain FDA approval of a
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new NDA or a NDA supplement, which may require the applicant to develop additional data or conduct additional preclinical studies and clinical trials.
Once an NDA or BLA approval is granted, the FDA may withdraw the approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product or therapeutic reaches the market. Later discovery of previously unknown problems with a product or therapeutic candidate, including adverse events of unanticipated severity or frequency, may result in in mandatory revisions to the approved labeling to add new safety information; imposition of post-market or clinical trials to assess new safety risks; or imposition of distribution or other restrictions under a REMS program. Other potential consequences include, among other things:
Accordingly, a therapeutic candidate manufactured or distributed by us pursuant to FDA approvals are subject to continuing regulation by the FDA, including, among other things:
FDA regulations require that products be manufactured in specific approved facilities and in accordance with cGMPs. The cGMP regulations include requirements relating to organization of personnel, buildings and facilities, equipment, control of components and drug product containers and closures, production and process controls, packaging and labeling controls, holding and distribution, laboratory controls, records and reports and returned or salvaged products. Therapeutic manufacturers and other entities involved in the manufacture and distribution of approved therapeutic products are required to register their establishments with the FDA and certain state agencies and are subject to periodic unannounced inspections by the FDA, foreign regulatory agencies, and some state agencies for compliance with cGMPs and other laws. In addition, changes to the manufacturing process are strictly regulated, and, depending on the significance of the change, may require FDA approval before being implemented. FDA regulations also require investigation and correction of any noncompliance with cGMP requirements. FDA regulations also require investigation and correction of any deviations from cGMP and impose reporting and documentation requirements upon the NDA or BLA applicant and any third-party manufacturers involved in producing the approved product. Accordingly, manufacturers must continue to expend time, money and effort in the area of production and quality control to maintain compliance with cGMP and other aspects of quality control and quality assurance.
In addition, the distribution of prescription pharmaceutical products is subject to the Prescription Drug Marketing Act, or the PDMA, which regulates the distribution of drugs and drug samples at the federal level and sets minimum standards for the registration and regulation of drug distributors by the states. Both the PDMA and state laws limit the distribution of prescription pharmaceutical product samples and impose requirements to ensure accountability in distribution. The Drug Supply Chain Security Act, or the DSCSA, was enacted with the aim of building an electronic system to identify and trace certain prescription drugs distributed in the United States, including most biological products. The DSCSA mandates phased-in and resource-intensive obligations for pharmaceutical manufacturers, wholesale distributors, and dispensers over a 10‐year period that is expected to culminate in November 2023. From time to time, new legislation and regulations may be implemented that could significantly change the statutory provisions governing the approval, manufacturing and marketing of products regulated by the FDA. It is impossible to predict whether further
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legislative or regulatory changes will be enacted, or FDA regulations, guidance or interpretations changed or what the impact of such changes, if any, may be.
Regulation Outside of the United States
In addition to regulations in the United States, we will be subject to regulations of other jurisdictions governing any clinical trials and commercial sales and distribution of our therapeutic candidates. Whether or not we obtain FDA approval for a product, we must obtain approval by the comparable regulatory authorities of countries outside of the United States before we can commence clinical trials in such countries and approval of the regulators of such countries or economic areas, such as the European Union, before we may market products in those countries or areas. It also is not yet clear how the United Kingdom’s recent withdrawal from the European Union will affect the approval of medicinal products in the United Kingdom. The approval process and requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement vary greatly from place to place, and the time may be longer or shorter than that required for FDA approval.
Under European Union regulatory systems, a company can consider applying for marketing authorization in several European Union member states by submitting its marketing authorization application(s) under a centralized, decentralized or mutual recognition procedure. The centralized procedure provides for the grant of a single marketing authorization that is valid for all European Union member states. The centralized procedure is compulsory for medicines derived from biotechnology, orphan medicinal products, or those medicines with an active substance not authorized in the European Union on or before May 20, 2004 intended to treat acquired immune deficiency syndrome, cancer, neurodegenerative disorders or diabetes and optional for those medicines containing a new active substance not authorized in the European Union on or before May 20, 2004, medicines which are highly innovative, or medicines to which the granting of a marketing authorization under the centralized procedure would be in the interest of patients at the European Union-level. The decentralized procedure provides for recognition by European Union national authorities of a first assessment performed by one of the member states. Under this procedure, an identical application for marketing authorization is submitted simultaneously to the national authorities of several European Union member states, one of them being chosen as the “Reference Member State,” and the remaining being the “Concerned Member States.” The Reference Member State must prepare and send drafts of an assessment report, summary of product characteristics and the labeling and package leaflet within 120 days after receipt of a valid marketing authorization application to the Concerned Member States, which must decide within 90 days whether to recognize approval. If any Concerned Member State does not recognize the marketing authorization on the grounds of potential serious risk to public health, the disputed points are eventually referred to the European Commission, whose decision is binding on all member states. The mutual recognition procedure is similar to the decentralized procedure except that a medicine must have already received a marketing authorization in at least one of the member states, and that member state acts as the Reference Member State.
As in the United States, we may apply for designation of a therapeutic candidate as an orphan drug for the treatment of a specific indication in the European Union before the application for marketing authorization is made.
Orphan drugs in the European Union enjoy economic and marketing benefits, including up to ten years of market exclusivity for the approved indication unless another applicant can show that its product is safer, more effective or otherwise clinically superior to the orphan-designated product, the marketing authorization holder is unable to supply sufficient quantity of the medicinal product, or the marketing authorization holder has given its consent.
Coverage, Pricing and Reimbursement
Sales of our products will depend, in part, on the extent to which our products will be covered by third-party payors, such as government health programs, commercial insurance and managed healthcare organizations. There may be significant delays in obtaining coverage and reimbursement for approved products, and coverage may be more limited than the purposes for which the product is approved by the FDA or regulatory authorities in other countries. It is time consuming and expensive to seek reimbursement from third-party payors. Moreover, eligibility for reimbursement does not imply that any product will be paid for in all cases or at a rate that covers our costs, including research, development, manufacture, sale and distribution. Interim payments for new products, if applicable, may also not be sufficient to cover our costs and may not be made permanent. Payment rates may vary according to the use of the product and the clinical setting in which it is used, may be based on payments allowed for lower cost products that are already reimbursed and may be incorporated into existing payments for other services. Net prices for products may be reduced by mandatory discounts or rebates required by third-party payors and by any future relaxation of laws that presently restrict imports of products from countries where they may be sold at lower prices than in the United States. In the U.S., third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement policies, but they also have their own methods and approval process apart from Medicare coverage and reimbursement determinations. Accordingly, one third-party payor’s determination to provide coverage for a product does not assure that other payors will also provide coverage for the product.
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Additionally, the containment of healthcare costs has become a priority of federal and state governments and the prices of therapeutics have been a focus in this effort. The United States government, state legislatures and foreign governments have shown significant interest in implementing cost-containment programs, including price controls, restrictions on reimbursement and requirements for substitution of generic and biosimilar products. Adoption of price controls and cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit our net revenue and results. If these third-party payors do not consider our products to be cost-effective compared to other therapies, they may not cover our products after approval as a benefit under their plans or, if they do, the level of payment may not be sufficient to allow us to sell our products on a profitable basis. In addition, companion diagnostic tests require coverage and reimbursement separate and apart from the coverage and reimbursement for their companion pharmaceutical or biological products. Similar challenges to obtaining coverage and reimbursement for the pharmaceutical or biological products apply to companion diagnostics.
Moreover, in some foreign countries, the proposed pricing for a product and therapeutic candidate must be approved before it may be lawfully marketed. The requirements governing therapeutic pricing vary widely from country to country. For example, the European Union provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market. There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any of our therapeutic candidates. Historically, therapeutic candidates launched in the European Union do not follow price structures of the United States and generally tend to be significantly lower.
Healthcare Reform
In the United States and some foreign jurisdictions, there have been, and continue to be, several legislative and regulatory changes and proposed changes regarding the healthcare system that could prevent or delay marketing approval of product and therapeutic candidates, restrict or regulate post-approval activities, and affect the ability to profitably sell product and therapeutic candidates that obtain marketing approval. The FDA’s and other regulatory authorities’ policies may change, and additional government regulations may be enacted that could prevent, limit, or delay regulatory approval of our product and therapeutic candidates. For example, in the United States, the system for FDA to collect and expend user fees paid by manufacturers of drugs, biologics, and medical devices must be reauthorized by statute every five years, and since 1992, each reauthorization legislation has included, to greater or lesser degrees, various other changes to the FDA’s regulatory systems and procedures. The current legislative authority for FDA user fees expires in September 2022, and by that time, new legislation will be required for FDA to continue collecting prescription drug user fees in future fiscal years. The expected 2022 reauthorization may include new legal provisions that could significantly impact our business in ways that cannot be predicted at this time. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we otherwise may have obtained and we may not achieve or sustain profitability, which would adversely affect our business, prospects, financial condition and results of operations. Moreover, among policy makers and payors in the United States and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goals of reducing drug prices, containing healthcare costs more generally, improving quality and/or expanding access.
For example, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively the ACA, was enacted in March 2010 and has had a significant impact on the health care industry in the U.S. The ACA expanded coverage for the uninsured while at the same time containing overall healthcare costs. It also included the BPCIA, which created an abbreviated approval pathway for biological products that are biosimilar to or interchangeable with an FDA-licensed reference biological product. With regard to biopharmaceutical products, the ACA, among other things, addressed a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, increased the minimum Medicaid rebates owed by manufacturers under the Medicaid Drug Rebate Program and extended the rebate program to individuals enrolled in Medicaid managed care organizations, established annual fees on manufacturers of certain branded prescription drugs, and created a new Medicare Part D coverage gap discount program.
Since its enactment, there have been executive, judicial and Congressional challenges to certain aspects of the ACA and we expect there may be additional challenges and amendments to the ACA in the future.
In addition, other legislative changes have been proposed and adopted in the United States since the ACA that affect health care expenditures. These changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013 and will remain in effect through 2030 unless additional Congressional action is taken. The Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, which was signed into law on March 27, 2020, and was designed to provide financial support and resources to individuals and businesses affected by the COVID-19 pandemic, suspended the 2% Medicare sequester from May 1, 2020 through December 31, 2020, and extended the sequester by one year, through 2030, in order to offset the added expense of the 2020 cancellation.
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Additionally, on December 20, 2019, the Further Consolidated Appropriations Act for 2020 became law (P.L. 116-94), which includes a piece of bipartisan legislation called the Creating and Restoring Equal Access to Equivalent Samples Act of 2019 or the “CREATES Act.” The CREATES Act aims to address the concern articulated by both the FDA and others in the industry that some brand manufacturers have improperly restricted the distribution of their products, including by invoking the existence of a REMS for certain products, to deny generic and biosimilar product developers access to samples of brand products. Because generic and biosimilar product developers need samples to conduct certain comparative testing required by the FDA, some have attributed the inability to timely obtain samples as a cause of delay in the entry of generic and biosimilar products. To remedy this concern, the CREATES Act establishes a private cause of action that permits a generic or biosimilar product developer to sue the brand manufacturer to compel it to furnish the necessary samples on “commercially reasonable, market-based terms.” Whether and how generic and biosimilar product developments will use this new pathway, as well as the likely outcome of any legal challenges to provisions of the CREATES Act, remain highly uncertain and its potential effects on our future commercial products are unknown.
Moreover, there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drug products. While the Trump administration put forward various proposals and executive orders aimed at reducing drug prices, the Biden administration is likely to pursue its own proposals going forward. In August 2021, President Biden announced his support for legislative proposals to grant Medicare the power to negotiate lower drug prices, for pharmaceutical companies to face penalties if they raise prices faster than inflation, and to impose a new cap on how much Medicare recipients have to spend on medications. Such proposals may be included in upcoming legislation in Congress, but the outcome of such proposals remains uncertain.
Individual states in the United States have also increasingly passed legislation and implemented regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative or executive action, either in the United States or abroad. We expect that additional state and federal health care reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for health care products and services.
Other Healthcare Laws
Our current and future business operations are subject to healthcare regulation and enforcement by the federal government and the states and foreign governments where we research, and, if approved, market, sell and distribute our therapeutic candidates. These laws include, without limitation, state and federal anti-kickback, fraud and abuse, false claims, privacy and security, physician sunshine and drug pricing transparency laws and regulations such as:
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