Attached files
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| EX-99.1 - PRESS RELEASE - Cellular Biomedicine Group, Inc. | cbmg_ex991.htm |
| EX-10.2 - SECURITIES PURCHASE AGREEMENT - Cellular Biomedicine Group, Inc. | cbmg_ex102.htm |
| EX-10.1 - LICENSE AND COLLABORATION AGREEMENT - Cellular Biomedicine Group, Inc. | cbmg_ex101.htm |
| EX-4.1 - REGISTRATION RIGHTS AGREEMENT - Cellular Biomedicine Group, Inc. | cbmg_ex41.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): September 25,
2018
CELLULAR BIOMEDICINE GROUP, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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001-36498
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86-1032927
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(State
or other Jurisdiction of Incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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19925 Stevens Creek Blvd., Suite 100
Cupertino, California
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95014
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (408)
973-7884
(Former
name or former address, if changed since last report.)
Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
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☐
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
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☐
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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☐
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
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☐
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
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Emerging
growth company ☐
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. ☐
Item 1.01 Entry into a Material Definitive Agreement
License and Collaboration Agreement
On
September 25, 2018, Cellular Biomedicine Group, Inc. (the
“Company”) together with certain of its subsidiaries
and controlled entities entered into a License and Collaboration
Agreement (the “Collaboration Agreement”) with Novartis
Pharma AG (“Novartis”) pursuant to which the Company
will manufacture and supply Novartis the Chimeric Antigen Receptor
T (“CAR-T”) cell therapy Kymriah®
(tisagenlecleucel) (the “Product”). The Company also
granted Novartis a world-wide license certain of its intellectual
property and technology, including those related to the Product.
Such license is exclusive with respect to the development,
manufacture and commercialization of the Product and non-exclusive
with respect to the development, manufacture and commercialization
of other products.
Under
the Collaboration Agreement, the Company will receive collaboration
payments equal to a single-digit escalating percentage of net sales
of the Product in China, subject to certain caps set forth
thereunder, for sales in diffuse large B-cell lymphoma and
pediatric acute lymphoblastic leukemia indications and up to a
maximum amount to be agreed upon for sales in other
indications.
The
Company is also obligated to assist Novartis with the development
of the Product in China as Novartis may request and is responsible
for a certain percentage of the total development costs for
development of the Product in China for indications other than
diffuse large B-cell lymphoma and pediatric acute lymphoblastic
leukemia indications. Additionally, the Company is obligated to
conduct a technology transfer to Novartis of the technology to be
licensed to Novartis and perform activities to receive a transfer
of the manufacturing process for the Product from Novartis, each in
accordance with mutually agreed transfer plans. The Company will
bear all costs incurred by the parties in connection with or
arising out of the transfer plans.
Pursuant
to the Collaboration Agreement, within 90 days of the date of the
Collaboration Agreement, the Company will enter into a
manufacturing and supply agreement (“Manufacture and Supply
Agreement”) with Novartis that will govern the terms of
manufacture and supply of the Product. Under the Manufacture and
Supply Agreement, it is contemplated that the Company will be
entitled to a transfer payment for supply of the Product to
Novartis equal to certain direct costs plus a mark-up, subject to a
maximum transfer price. Additionally, the Company will be obligated
at its cost to establish manufacturing capacity as requested by
Novartis and will be obligated during the first two years of the
term of the Manufacture and Supply Agreement to offer any
additional manufacturing capacity to Novartis before entering into
any agreement relating to such additional capacity.
The
Collaboration Agreement provides that, during its term and for
certain period thereafter, the Company will not, and will cause its
affiliates, licensees and sublicensees not to, develop, manufacture
or commercialize any CAR-T therapy targeting CD-19 other than the
Product. Additionally, the Company has granted Novartis certain
first rights with respect to its CAR-T therapies and for a change
of control.
The
Collaboration Agreement will continue for 10 years and then
automatically renew for additional two years unless Novartis
provides notice of non-renewal. It also contains standard and
customary termination rights and provides for termination by
Novartis in other circumstances. Novartis’s non-exclusive
license under the Company’s intellectual property and
technology with respect to the development, manufacture,
commercialization of any product will survive any expiration or
termination of the Collaboration Agreement.
Securities Purchase Agreement
On
September 25, 2018, the Company entered into a Share Purchase
Agreement (the “Purchase Agreement”) with Novartis
pursuant to which the Company agreed to sell, and Novartis agreed
to purchase from the Company, an aggregate of 1,458,257 shares (the
“Shares”) of the Company’s common stock, par
value $0.001 per share (“Common Stock”), at a purchase
price of $27.43 per share, which was the equivalent of 130% of the
volume-weighted average price of the Common Stock for the prior 20
consecutive trading days (the “Purchase Price”), for
total gross proceeds of approximately $40 million (the
“Private Placement”).
The
Purchase Agreement sets forth certain conditions under which the
Company and/or Novartis can terminate the agreement. Among other
conditions, if the Company breaches any of its obligation under the
Registration Rights Agreement (as defined below), Novartis may
terminate the Purchase Agreement and exercise any other remedies
available to it. Within 10 business days of receipt of notice of
such termination, the Company has the obligation to repurchase the
Shares from Novartis at the Purchase Price and the Registration
Rights Agreement will be deemed terminated.
The
Purchase Agreement also contains mutual indemnification provisions
pursuant to which each of the Company and Novartis agreed to
indemnify the other party for its any breaches of its
representations and warranties under the Purchase Agreement, any
failure to comply with covenants, agreements and other obligations
therein and enforcement of indemnification rights provided
thereunder. In addition, subject to certain exceptions, the
indemnification obligations of each party under the Purchase
Agreement are subject to an indemnification cap of the aggregate
purchase price (approximately $40 million) and a $200,000
deductible.
Registration Rights Agreement
In
connection with the Private Placement, the Company and Novartis
entered into a Registration Rights Agreement (the
“Registration Rights Agreement”) pursuant to which the
Company has agreed, subject to certain conditions set forth
therein, to file a registration statement (the “Registration
Statement”) on Form S-3 or other appropriate form if the
Company is then ineligible for using Form S-3 with the Securities
and Exchange Commission (the “SEC”) within 15 calendar
days following the Closing (as defined below) to register resale of
the Shares and any securities issued or then issuable upon stock
split and other events set forth under the Registration Rights
Agreement (the “Registrable Securities”). The Company
has also agreed to use commercially reasonable efforts to cause
such registration statement to be declared effective under the
Securities Act of 1933, as amended (the “Securities
Act”) as promptly as reasonably practicable after the filing
date thereof but no later than the applicable outside date set
forth under the Registration Rights Agreement. The Company has also
agreed to use commercially reasonable efforts to keep such
registration statement continuously effective until all Registrable
Securities covered thereby have been sold or are eligible for
resale pursuant to Rule 144 under the Securities Act. If the
Company fails to perform any of the foregoing obligations, it has
the obligation to pay certain liquidated damages set forth under
the Registration Rights Agreement, subject to a cap in the amount
of 9% of the aggregate purchase price of the Shares.
Subject
to certain exceptions under the Registration Rights Agreement, the
Company has agreed not to include any securities other than the
Registrable Securities in the Registration Statement and not to
file any other registration statements until the Registration
Statement is declared effective by the SEC.
The
Company has also agreed, among other things, to provide Novartis
with piggyback registration rights (subject to certain conditions),
to indemnify the selling holders under the Registration Statement
from certain liabilities and to pay all fees and expenses
(excluding underwriting discounts and selling commissions and
expenses of selling stockholders) incident to the Company’s
obligations under the Registration Rights Agreement.
The
closing of the Private Placement (the “Closing”)
occurred on September 26, 2018. The sale and issuance of the Shares
were made in reliance on the exemption from registration provided
by Regulation S and/or Section 4(a)(2) under the Securities Act.
The securities sold and issued in connection with the Purchase
Agreement are not registered under the Securities Act or any state
securities laws and may not be offered or sold in the United States
absent registration with the SEC or an applicable exemption from
the registration requirements.
The
foregoing descriptions of the Collaboration Agreement, the Purchase
Agreement and the Registration Rights Agreement are only a summary
and are qualified in their entirety by reference to each of these
agreements, a copy of which is filed herewith as Exhibits 10.1,
10.2 and 4.1, respectively.
Item 3.02 Unregistered Sales of Equity Securities.
The
information called for by this item is contained in Item 1.01,
which is incorporated herein by reference.
Item 8.01. Other Events.
On
September 26, 2018, the Company issued a press release announcing
entry into of the Collaboration Agreement and the Closing, a copy
of which is attached as Exhibit 99.1 to this Current Report on Form
8-K.
Item 9.01 Financial Statements and Exhibits.
(d)
Exhibits
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Registration
Rights Agreement, dated September 26, 2018, by and between the
Company and Novartis Pharma AG.
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License
and Collaboration Agreement, dated September 25, 2018, by and among
the Company, Novartis Pharma AG and other parties
thereto.*
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Securities
Purchase Agreement, dated September 25, 2018, by and among the
Company, Novartis Pharma AG and Shanghai Cellular Biopharmaceutical
Group Ltd.
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Press
Release, dated September 26, 2018
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*Confidential treatment is requested for portions of this exhibit
pursuant to 17 CFR Section 240.246-2
SIGNATURE
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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Cellular Biomedicine Group, Inc.
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Date:
September 27, 2018
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By:
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/s/ Bizuo
(Tony) Liu
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Bizuo
(Tony) Liu
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Chief
Executive Officer
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