Benzinga | Oct 28, 2020 08:10AM EDT

Keros Therapeutics On Oct 26, Got Notice From Novo Nordisk That It Has Elected To Terminate Research Collaboration, Exclusive License Agreement; Novo Nordisk's Decision To Terminate Collaboration Agreement Was Due To Strategic And Business Reasons

On October 26, 2020, Keros Therapeutics, Inc. (the "Company") received notice from Novo Nordisk A/S ("Novo Nordisk") that Novo Nordisk has elected to terminate the Research Collaboration and Exclusive License Agreement, dated December 14, 2017 (the "Collaboration Agreement"), by and between Novo Nordisk and the Company. Under the Collaboration Agreement, Novo Nordisk had the right to develop and commercialize a prespecified number of ligand traps selected by Novo Nordisk. Novo Nordisk's decision to terminate the Collaboration Agreement was due to strategic and business reasons. The termination of the Collaboration Agreement will be effective six months following the notice of termination, on April 26, 2021.

Pursuant to the terms of the Collaboration Agreement, Novo Nordisk paid the Company an initial license payment of $16.0 million in 2018, and has paid the Company $4.0 million in research funding over the two-year research program. Under the terms of the Collaboration Agreement, during the term of the agreement, we are not permitted, directly or indirectly, to research, develop or commercialize any ligand trap or ligand binder for use in the licensed field or any selected ligand trap outside of the licensed field, provided that after the expiration of the research collaboration term, we may research, develop, or commercialize any declined ligand trap for use in cardiovascular disease and chronic kidney disease. This summary is qualified in its entirety by reference to the full text of the Collaboration Agreement, which was filed as Exhibit 10.11 to the Company's Form S-1 filed on March 16, 2020, and is incorporated by reference herein.

As a result of the termination of the Collaboration Agreement, the Company will regain worldwide rights to all ligand traps selected under the Collaboration Agreement, along with all rights to develop Keros molecules in the fields of diabetes, obesity, nonalcoholic steatohepatitis and cachexia.