ROCKVILLE, Md. and BEIJING, Sept. 29, 2020 /PRNewswire/ -- CASI Pharmaceuticals, Inc. (Nasdaq: CASI), a U.S. biopharmaceutical company focused on developing and commercializing innovative therapeutics and pharmaceutical products, today announced a restructuring of its partnership with Juventas Cell Therapy Ltd. relating to CNCT19, an investigational CD19 CAR-T Cell therapy. Juventas is currently developing CNCT19 for the treatment of patients with relapsed B-cell Non-Hodgkin lymphoma and B-cell acute lymphoblastic leukemia, and expects to initiate registration trials in early 2021.
Larry Zhang, CASI's President, commented, "We continue to be very enthusiastic about the innovative work Juventas is doing in the hematological malignancy space and look forward to our continued partnership with Juventas as we build a stronger and more integrated team. With the restructuring in place, Juventas now can attract new capital to help fund its upcoming trials and build out a world-class GMP manufacturing facility for commercial production of CNCT19. At the same time, we are reducing CASI's exposure to Juventas' future financial needs while ensuring that CNCT19 clinical development remains on track. CASI is committed to the commercial success of this program."
Mr. Zhang continued, "Importantly, we are also pleased to increase our equity position in Juventas which we believe will have significant upside potential for its shareholders in the China financial marketplace. As one of its major shareholders and with rights to designate a seat on the board of directors, we will continue to ensure the financial success of our investment."
Under the terms of the original licensing agreement between CASI and Juventas, CASI obtained a worldwide license for the commercialization of CNCT19 and Juventas was responsible for the clinical development, manufacturing and supply of CNCT19. As part of the original agreement, CASI Biopharmaceuticals (Wuxi) Co., Ltd ("CASI Wuxi Bio") invested in Juventas' Series A financing. The original agreement also provided that CASI would be responsible for payment of certain sales royalties and a development milestone in the amount of RMB 70 million upon the initiation of the registration trials.
Effective as of September 22, 2020, Juventas and its shareholders (including CASI Wuxi Bio) agreed to certain terms and conditions in connection with Juventas' Series B financing. In order to facilitate the Series B financing, CASI agreed to restructure its partnership with Juventas by amending and supplementing its original licensing agreement (the "Supplementary Agreement"). Under the Supplementary Agreement, CASI and Juventas will partner to co-commercialize CNCT19 and jointly be responsible for forming an integrated marketing team to carry out marketing activities, and CASI will continue to be responsible for recruiting and establishing a sales team to commercialize CNCT19. In addition, the Supplementary Agreement provides CASI with co-commercial rights to a second pipeline product from Juventas, subject to certain terms and conditions.
As part of this transaction, Juventas will waive the RMB 70 million milestone payment due from CASI in connection with the upcoming start of registration trials for CNCT19. CASI and Juventas will share a percentage of total net profits, with CASI receiving a tiered percentage of up to 50% of the net profit from commercial sales of CNCT19 depending on annual net sales, with a specified minimum annual target net profit to be distributed to Juventas as a percentage of net profit from commercial sales. In addition, CASI will be responsible for single digit royalty fee equal to a percentage of net sales that varies by region.
As part of this transaction, CASI Wuxi Bio will invest RMB 70 million in Juventas' Series A Plus equity, resulting in equity ownership of approximately 19.65% (post-Juventas Series B financing) and entitling it to appoint a director to the Juventas' board of directors.
Dr. Wei-Wu He, CASI's Chairman and CEO, is the chairman and a founding shareholder of Juventas. James Huang, CASI's director, is a managing partner of an existing shareholder of Juventas. A committee of independent directors of CASI negotiated and approved the terms of this transaction. Dr. He and Mr. Huang did not participate in the committee's deliberations or the approval of this transaction.
Juventas Cell Therapy Ltd. is an innovative cell therapy company with headquarters located in Tianjin City, China. The company's lead product, CNCT19 (CD19 CAR-T), was originally created at the Institute of Hematology, Chinese Academy of Medical Sciences, one of the top hematology centers in China. CD19 CAR-T is used to treat patients with acute lymphoblastic leukemia and relapsed non-Hodgkin lymphoma. Juventas' pipeline also includes a pre-IND CD19/CD20 CAR-T that is currently in pre-IND development for non-Hodgkin lymphoma, along with other cellular-based products in preclinical and exploratory studies.
About CASI Biopharmaceuticals (Wuxi) Co., Ltd
CASI Biopharmaceuticals (Wuxi) Co., Ltd ("CASI Wuxi Bio") is a wholly-owned China subsidiary of CASI Pharmaceuticals (Wuxi) Co, Ltd., an 80%/20% China joint venture between CASI Pharmaceuticals (China) Co., Ltd. ("CASI China") and Wuxi Huicheng Yuanda Investment Enterprise (LP). CASI China is a wholly-owned subsidiary of the Company.
About CASI Pharmaceuticals
CASI Pharmaceuticals, Inc. ("CASI" or the "Company") is a U.S. biopharmaceutical company focused on developing and commercializing innovative therapeutics and pharmaceutical products in China, the United States, and throughout the world. The Company is focused on acquiring, developing and commercializing products that augment its hematology oncology therapeutic focus as well as other areas of unmet medical need. The Company intends to execute its plan to become a leader by launching medicines in the greater China market leveraging the Company's China-based regulatory and commercial competencies and its global drug development expertise. The Company's operations in China are conducted through its wholly-owned subsidiary, CASI Pharmaceuticals (China) Co., Ltd. ("CASI China"), which is located in Beijing, China. The Company has built a commercial team of over 70 hematology and oncology sales and marketing specialists based in China. More information on CASI is available at www.casipharmaceuticals.com.
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to the outlook for expectations for future financial or business performance, revenue growth, strategies, expectations and goals. Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and we assume no duty to update forward-looking statements. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor 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. Actual results could differ materially from those currently anticipated due to a number of factors.