Benzinga | Aug 10, 2020 08:38AM EDT

Verastem Oncology Signs Definitive Agreement To Sell COPIKTRA Rights To Secura Bio To Focus On Development Of VS-6766 And Defactinib In KRAS Mutant Solid Tumors; Co. Will Receive $70M Upfront Payment, Total Deal Value $311M

Verastem Will Receive $70 Million Up-Front with Total Deal Value Up to $311 Million, Plus Double-Digit Sales Royalties

Upon Closing, Verastem's Current Programs Will Be Funded Until At Least 2024 to Develop VS-6766 and Defactinib in Low-Grade Serous Ovarian Cancer and KRAS Mutant Non-Small Cell Lung Cancer

Phase 2 Registration-Directed Trials Expected to Commence by Year End 2020 in Both Low-Grade Serous Ovarian Cancer and KRAS Mutant Non-Small Cell Lung Cancer

Enrollment in Ongoing Investigator-Initiated Phase 1/2 FRAME Study of VS-6766 and Defactinib Now Expanding to Include Pancreatic, KRAS Mutant Endometrial and KRAS-G12V Non-Small Cell Lung Cancer Cohorts

Verastem, Inc. (NASDAQ:VSTM) (also known as Verastem Oncology), a biopharmaceutical company committed to advancing new medicines for patients battling cancer, today announced that it has entered into a definitive agreement to sell its global commercial and development rights to COPIKTRA (duvelisib), its marketed oral inhibitor of phosphoinositide 3-kinase (PI3K), and the first FDA-approved dual inhibitor of PI3K-delta and PI3K-gamma, to Secura Bio, Inc., an integrated biopharmaceutical company dedicated to the worldwide commercialization of significant oncology therapies.

Verastem's sale of COPIKTRA follows the Company's previously announced strategic direction to focus on maximizing the broad potential of its RAF/MEK inhibitor (VS-6766) and FAK inhibitor (defactinib) program in KRAS mutant (KRASmt) solid tumors. Upon closing of the transaction with Secura Bio, Verastem will be dedicated to the development of this program and to deliver on clinical and regulatory milestones for the first potential indications in low-grade serous ovarian cancer (LGSOC) and KRASmt non-small cell lung cancer (NSCLC). Both LGSOC and KRASmt NSCLC are areas of high unmet patient need as there are no approved treatments and existing therapies have low response rates.

"By focusing our expertise and efforts on rapidly advancing the RAF/MEK/FAK development program, we believe we will be providing the best path forward for patients, customers, our shareholders and our company. These strategic decisions will enable us to best deliver on our mission to advance new medicines on behalf of cancer patients," said Brian Stuglik, Chief Executive Officer of Verastem Oncology. "The agreement with Secura Bio will ensure COPIKTRA continues to help more patients, leveraging the established commercial structure, support of ongoing clinical study and potential expansion into new indications."

Terms of the Definitive Sale Agreement

Verastem will receive an up-front payment of $70 million upon the closing of the transaction and is eligible to receive up to a total deal value of $311 million if certain regulatory and sales-based milestones are successfully met by Secura Bio and COPIKTRA's other rest-of-world partners, including:

* A total of $45 million from two separate milestone payments for U.S. Food and Drug Administration (FDA) and European Medicines Agency approvals of COPIKTRA with label indicated for peripheral T-cell lymphoma

* A total of $50 million for cumulative worldwide net sales of COPIKTRA beginning at $100 million of cumulative net sales

* Verastem will receive low double-digit royalties on net sales over $100 million in U.S., Europe and the United Kingdom

* Verastem will also receive 50% of licensing milestones (up to $146 million) and royalties outside of U.S., Europe and the United Kingdom

In exchange, Secura Bio will receive an exclusive worldwide license for the research, development, commercialization and manufacture of COPIKTRA in all oncology indications. Secura Bio will assume all operational and financial responsibility for activities that were previously part of Verastem's duvelisib program, including commercialization efforts in the United States and Europe, ongoing clinical trials, Verastem's partnerships with Yakult, CSPC and Sanofi and existing royalty obligations. Secura Bio and Verastem are also in discussions related to the transfer of Verastem's field sales and medical professionals.

The transaction with Secura Bio is subject to customary closing conditions and is expected to close in the third quarter of 2020.*