Full Press Release Details
IN THE SUPERIOR COURT OF THE STATE OF DELAWARE
| CLIMB BIO, INC., | ) | |||
| ) | ||||
| Plaintiff, | ) | |||
| v. | ) | |||
| ) | C.A. No. ________CCLD | |||
| ALUMIS INC., and ACELYRIN, | ) | |||
| INC. (a wholly owned subsidiary), | ) | |||
| ) | ||||
| Defendant. | ) |
Plaintiff Climb Bio, Inc. ("Climb"), by and through its undersigned counsel, hereby alleges as and for its complaint against
Alumis Inc. ("Alumis") and Acelyrin, Inc. ("Acelyrin") (collectively, "Defendants" or "Alumis"), upon knowledge as to itself and its own acts and upon information and belief as to all other matters, as
1. Climb seeks the Court's intervention to resolve a dispute between the parties concerning their January 11, 2024 Asset Purchase
Agreement (the "APA"), which is hereby incorporated by reference and attached as Exhibit A.
2. Under the APA, Climb's predecessor-in-interest purchased assets from Defendant Acelyrin related to a drug candidate called budoprutug. In addition to a
one-time upfront payment for this asset purchase, the APA included terms for potential earn-out payments in the event that Climb were to exploit any
"Product," as defined in the APA. The APA defines a "Product" that could trigger these future payment obligations as limited to a budoprutug drug that would infringe "Royalty-Bearing Patents." Royalty-Bearing
Patents are limited, in turn, to (i) "Patents" included in the Transferred Assets transferred under the APA; or (ii) certain Patents filed within nine months of the APA's closing date.
3. No Royalty-Bearing Patents exist. No Patents were included in the Transferred
Assets under the APA, nor were any Patents that would constitute Royalty-Bearing Patents filed within nine months of the APA's closing. Accordingly, Climb is not (and could not be) developing a Product, and does not owe any obligations under
the APA in connection with its development or commercialization of budoprutug.
4. Acelyrin merged with Alumis in May 2025. Climb
subsequently contacted Alumis in good faith to confirm alignment on the parties' respective rights and obligations under the APA. In that communication, Climb made its position clear: since Acelyrin had not transferred any Patents under the
APA, and nine months had passed without the filing of any Royalty-Bearing Patent, no Products could be developed, and the attendant contractual terms related to Products would not be triggered.
5. Alumis disagreed with Climb's position, insisting it should profit from Climb's successful independent development of its
budoprutug drug candidate, even though Defendants have not contributed any Royalty-Bearing Patents (or any Patents at all) to establish exclusivity for Climb's drug candidate and help recoup the costs of development.
6. Alumis' position contradicts the plain language of the APA and is entirely
unreasonable. Under Alumis' interpretation, Defendants could receive upwards of $100 million dollars beyond the initial asset purchase price in the coming years for no added consideration or value. Defendants contributed no patents to
protect Climb's budoprutug drug candidate that would enable Climb to exclude any third party from developing an equivalent or competing drug and thus warrant such extensive obligations.
7. Over the last few months, Climb has repeatedly attempted to better understand Alumis' position and resolve this dispute out of court,
but Alumis has rebuffed all attempts to achieve an amicable resolution.
8. On November 17, 2025, despite receiving no
Royalty-Bearing Patents from Defendants, Climb successfully dosed its first patient with budoprutug in a Phase 2 clinical trial. Given the parties' ongoing dispute, Climb sent a courtesy notice of this development update to Alumis in good
faith, even though it had no obligation to do so. Climb also once again endeavored to discuss a potential resolution. Alumis responded by sending an invoice for a $3 million milestone payment that Alumis asserts is due on January 1, 2026.
Climb denies that any such payment is owed under the clear and unambiguous terms of the APA, which limit this milestone payment to a Product.
9. Climb made one final attempt to discuss this dispute with Alumis on December 17,
2025, but was again dismissed. Rather, Alumis reaffirmed its demand for a payment of $3 million by January 1, 2026.
seeks Court intervention to clarify the parties' rights and obligations under the APA. Specifically, Climb seeks a declaration that its budoprutug drug candidate is not a Product under the APA, and thus Climb does not owe Defendants the
$3 million Alumis invoiced for payment by January 1, 2026.
11. Plaintiff Climb Bio, Inc. is a corporation headquartered in Massachusetts and incorporated in Delaware. Climb is a clinical-stage
biotechnology company with a mission to deliver high impact, disease modifying medicines for individuals living with immune-related diseases. Climb seeks to develop transformative immune medicines with the potential to address immune-mediated
diseases impacting patients with limited treatment options.
12. Defendant Alumis Inc. is a corporation headquartered in California and
incorporated in Delaware. Alumis is a clinical stage biopharmaceutical company focused on the development and commercialization of medicines for autoimmune disorders.
13. Defendant Acelyrin, Inc. is a corporation headquartered in California and incorporated
in Delaware. Acelyrin merged with Alumis in May 2025 and is now a wholly owned subsidiary of Alumis.
14. This Court has subject matter jurisdiction pursuant to Article IV, Section 7 of the Delaware Constitution and 10 Del. C.
541 et seq. and 10 Del. C. 6501.
15. This Court has personal jurisdiction over the parties
because Plaintiff and Defendants are incorporated in Delaware.
16. The parties' contract provides for exclusive jurisdiction in
"the U.S. District Court for the District of Delaware (where federal jurisdiction exists) or the Court of Chancery of the State of Delaware sitting in the New Castle County (where federal jurisdiction does not exist)." APA
9.11(b). Plaintiff's claim for declaratory judgment concerning its obligations under the APA is a contract claim governed by state law, and the parties are not diverse, so federal jurisdiction does not exist. Plaintiff's claims are also
legal claims seeking legal relief, for which the Court of Chancery does not have jurisdiction. Because the United States District Court in the District of Delaware and the Court of Chancery lack jurisdiction over this dispute, jurisdiction and venue
are properly laid with this Court.
17. This case qualifies for assignment to the Superior Court's Complex Commercial
Litigation Division because the amount in controversy exceeds $1 million.
(a) Budoprutug Background
18. Budoprutug is an investigational monoclonal antibody that targets cells expressing a protein called CD19, which is found on the surface of
white blood cells that signal the presence of various types of cancers and autoimmune diseases in the body.
19. On information and
belief, Budoprutug was first developed by Merck KGaA ("Merck"). Pursuant to a collaboration between Merck and Cancer Research Technology Limited ("CRT") entered in or around December 2009, budoprutug was studied for use in
the treatment of patients with certain malignancies. In or around July 2018, in an agreement with CRT, Merck assigned its rights to budoprutug to CRT, including the assignment of patent rights related to the budoprutug compound.
20. In or around February 2020, CRT licensed rights to develop budoprutug using its patents to a company called ValenzaBio, Inc.
("ValenzaBio"), which began developing it to treat a rare autoimmune kidney disease. In or around January 2023, Acelyrin acquired ValenzaBio.
21. On information and belief, Acelyrin attributed minimal to no value to the budoprutug
development program in its acquisition of ValenzaBio. The publicly filed merger agreement between Acelyrin and ValenzaBio did not even expressly reference budoprutug.
22. Acelyrin then terminated development of budoprutug and use of the budoprutug rights it acquired from ValenzaBio, including terminating
ValenzaBio's ongoing clinical trial without even drafting a clinical study report for the trial.
23. On information and belief,
Acelyrin never filed a single patent application related to budoprutug.
24. Within less than a year of acquiring ValenzaBio, Acelyrin was
in active negotiations to sell off the budoprutug assets.
25. On January 11, 2024, Acelyrin sold its budoprutug assets to Tenet Medicines, Inc. ("Tenet") under the APA.
26. Tenet made an upfront payment of over $7 million to purchase Acelyrin's budoprutug related assets. APA 2.1, 2.2,
3.1. Acelyrin agreed to deliver to Tenet on the Closing Date all of the purchased assets in the form agreed upon by the parties. Id. 2.5; see also id. 4.2(c).
27. In addition to providing the terms of this
one-time payment for the asset purchase, the APA also included terms that would potentially come into effect if Tenet (which was subsequently acquired by Climb) were to develop a Product as defined in the APA.
These terms include non-monetary obligations, such as obligations to keep books and records and provide reporting on any Product, as well as monetary obligations, including making payments if any Product were
to achieve certain development and commercialization milestones. See, e.g., id. 3.2, 3.3, and 3.4.
The contract is express that these non-monetary and payment obligations apply only to the potential development and commercialization of a Product, as defined in the APA.
29. Section 1.1 of the APA defines "Product" as:
any biopharmaceutical product that incorporates or comprises Budoprutug, in any form, formulation or route of administration, and for use in
any Indication, including any Combination Product, the manufacture, use, offer for sale, sale, or importation of which would, but for the Royalty-Bearing Patents, infringe a Valid Claim. (emphasis added)
30. This definition of "Product" makes clear that a Product under the APA is limited to one that practices a "Royalty-Bearing
Patent," which is defined in Section 1.1 of the APA as:
(a) all Patents included in the Transferred Assets, and (b) each
other Patent filed by or on behalf of Buyer within nine (9) months following the Closing Date that discloses any Know-How included within the Owned Intellectual Property, and Covers the composition of
matter, method of use or method of manufacture of Budoprutug.
31. No Patents were transferred by Acelyrin in the Transferred Assets,1 including in Schedule 2.2(a)(vii) of the APA that sets forth the Owned Product Intellectual Property that is included in the Transferred Assets.2
32. Further, no Patents were filed within nine months following the Closing Date that could constitute Royalty-Bearing Patents.
33. Accordingly, neither of the circumstances outlined in the definition of Royalty-Bearing Patent occurred, and there are thus no
Royalty-Bearing Patents under the APA.
34. The only assets transferred under the APA that included rights under patents were
licenses to use CRT's patents. The APA provides that those licenses are Contracts, not Patents or Royalty-Bearing Patents that could trigger obligations to Acelyrin. Indeed, the APA defines "Patents"3 as separate from "Contracts"4 and refers to the CRT Licenses as "Transferred Contracts." See APA 2.2(a)(i)
& Schedule 2.2(a)(i). The APA also clearly distinguishes the patents that are subject to the CRT licenses from Royalty-Bearing Patents. For example, the APA defines "Budoprutug" to include any compound that "falls within the
scope of one or more Valid Claims of any of the Royalty-Bearing Patents in the relevant country or territory; and/or has been developed using or incorporating any part of the Licensed Rights (as such term is defined in the CRT
Agreement)." This language reflects the parties' intention that the patents licensed from CRT were distinct from any Royalty-Bearing Patents that could trigger contractual obligations under the APA.
35. Separating the CRT licenses from Royalty-Bearing Patents that could trigger payment
obligations to Acelyrin was intentional and made sense. The pre-existing license agreement between Acelyrin and CRT needed to be renegotiated, so Tenet entered a new license directly with CRT on the same date
the parties closed the APA. Under the CRT license, Tenet (now Climb) undertook a full set of obligations, including milestone and royalty payment obligations to CRT (the patent owner), for rights to use CRT's patented technology. If the CRT
patents were Royalty-Bearing Patents, Climb would have taken on duplicative obligations (including milestone and royalty payment obligations) to two different parties for use of a single set of patents - including obligations to Acelyrin,
which does not even own and did not have any part in inventing or reducing to practice the CRT patents.
36. The parties understood when
negotiating the APA that there were no Royalty-Bearing Patents and that there may never be any Royalty-Bearing Patents or resultant Products that triggered future rights to Acelyrin or obligations of Tenet. The parties included the forward-looking
development and payment plan in the APA to account for a potential circumstance where Acelyrin would either transfer to Tenet a Patent that would generate royalties, or such a Patent was filed in the nine months immediately following the
APA's closing. By nine months after the closing, it was clear that no Royalty-Bearing Patents existed, and no Products would be developed under the APA.
37. Alumis' public disclosures from prior to the parties' dispute reveal that