Full Press Release Details
Leap Therapeutics and BeiGene Announce
Exclusive Option and License Agreement for DKN-01
and Leap Announces $27 Million Equity
Cambridge, MA and Beijing, China-
January 3, 2020 - Leap Therapeutics, Inc. (Nasdaq:LPTX), a biotechnology company developing targeted immuno-oncology
therapeutics, and BeiGene, Ltd. (Nasdaq:BGNE; HKEX: 06160), a commercial-stage biopharmaceutical company focused on developing
and commercializing innovative molecularly-targeted and immuno-oncology drugs for the treatment of cancer, today announced an exclusive
option and license agreement for the clinical development and commercialization of DKN-01, Leap's anti-Dickkopf-1 (DKK1)
antibody, in Asia (excluding Japan), Australia, and New Zealand. Leap will retain exclusive rights for the development, manufacturing,
and commercialization of DKN-01 for the rest of the world. In addition, Leap announced entering into an agreement for a $27 million
equity financing with BeiGene and two institutional investors.
BeiGene Strategic Collaboration
"We are excited about the potential
to combine our anti-PD-1 inhibitor tislelizumab with DKN-01 as there have been promising signals in a biomarker-defined population
of gastric cancer patients in combination with checkpoint blockade," commented Yong (Ben) Ben, M.D., Chief Medical Officer,
Immuno-Oncology at BeiGene. "This collaboration with Leap is another example of our commitment to developing novel treatments
to address unmet medical needs in Asia and around the world."
Under the terms of the agreement, Leap
will receive an upfront cash payment of $3 million from BeiGene in exchange for granting BeiGene an option to an exclusive license
to develop and commercialize DKN-01 in Asia (excluding Japan), Australia, and New Zealand, and will be eligible to receive an additional
payment from BeiGene upon BeiGene's exercise of the option following initial proof-of-concept studies. Additionally, Leap
is eligible to receive payments from BeiGene based upon the achievement of certain development, regulatory, and sales milestones
for a total deal value of up to $132 million, together with tiered royalties on any product sales of DKN-01 in the licensed territory.
BeiGene will also make a $5 million equity investment in Leap as part of the contemporaneous $27 million equity financing.
"Securing a collaboration to further
develop DKN-01 has been our top strategic priority, and we are excited to begin working with BeiGene, a global leader in oncology,"
said Christopher K. Mirabelli, Ph.D., President and Chief Executive Officer of Leap Therapeutics. "BeiGene is the ideal partner
for Leap given its extensive experience in the development of oncology drugs throughout Asia Pacific, where its expertise and product
breadth can help us in our efforts to address serious unmet medical needs in esophagogastric, gynecologic, and other cancers."
During the option period, Leap has agreed
to study the combination of DKN-01 and tislelizumab. Leap plans to evaluate DKN-01 with tislelizumab in approximately 40 patients
with second-line gastric cancer (GC) / gastroesophageal junction cancer (GEJ) whose tumors express high levels of DKK1 to build
upon the the positive clinical experience of DKN-01 in combination with PD-1 inhibitors in these patients. In addition, Leap plans
to evaluate the combination of DKN-01 with tislelizumab and chemotherapy in approximately 20 patients with first-line GC/GEJ. Leap
expects to initiate these clinical trials in the first half of 2020.
In connection with the licensing agreement
with BeiGene, Leap has also entered into a securities purchase agreement to issue and sell in a private placement 1,421,801 shares
of newly designated Series A mandatorily convertible preferred stock to a lead institutional investor and 1,137,442 shares of newly
designated Series B mandatorily
convertible preferred stock
to BeiGene and Perceptive Advisors, each at a price of $10.55 per share, upon the closing of the equity financing. The
preferred stock price reflects a common stock equivalent price of $1.055, the closing price for Leap's common stock on
the Nasdaq Global Market on the day of pricing, January 2, 2020. At the closing, the holder of Series A mandatorily
convertible preferred stock will also receive a special voting preferred share that will entitle it to elect one member of
Leap's Board of Directors. Upon approval by
the stockholders of Leap, the Series A mandatorily convertible preferred stock will be automatically converted into
pre-funded warrants to purchase 14,218,010 shares of common stock and the Series B mandatorily convertible preferred stock
will be automatically converted into 11,374,420 shares of common stock, plus additional shares representing payment of an 8%
per annum accruing dividend. Upon stockholder approval and conversion of the preferred stock, the investors will also
receive warrants to purchase up to an equal number of shares of common stock at an exercise price of $2.11 per share. The
aggregate gross proceeds to Leap from this offering are approximately $27 million, before deducting placement agent fees
and estimated offering expenses payable by Leap, and not including proceeds from the exercise of any warrants. Subject
to customary closing conditions, the equity financing is scheduled to close on or before January 8, 2020.
Leap plans to hold a special meeting of
stockholders to approve an increase in the number of authorized shares of commom stock, the conversion of the convertible preferred
stock into shares of common stock, the issuance of the warrants, and related matters. In connection with such stockholder meeting,
Leap entered into a voting agreement with entities affiliated with HealthCare Ventures holding an aggregate of 29.3% of the company's
outstanding common stock to vote all of their beneficially owned shares in favor of the matters to be proposed at the special meeting
Raymond James & Associates, Inc. was
the placement agent for the equity financing.
The securities being sold in the private
placement have not been registered under the Securities Act of 1933, as amended, or state securities laws and may not be offered
or sold in the United States absent registration with the Securities and Exchange Commission (SEC) or an applicable exemption from
such registration requirements. Leap has agreed to file a registration statement with the SEC covering the resale of the shares
of common stock issuable upon conversion of the preferred stock and exercise of the warrants issued in the private placement.
This press release does not constitute
an offer to sell or the solicitation of an offer to buy the securities, nor shall there be any sale of the securities in any state
in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws
DKN-01 is a humanized monoclonal antibody
that binds to and blocks the activity of the Dickkopf-1 (DKK1) protein, a modulator of Wnt/Beta-catenin signaling, a signaling
pathway frequently implicated in tumorigenesis and suppressing the immune system. DKK1 has an important role in tumor cell signaling
and in mediating an immuno-suppressive tumor microenvironment through enhancing the activity of myeloid-derived suppressor cells
and downregulating NK ligands on tumor cells.
About gastroesophageal junction (GEJ)
/gastric adenocarcinoma
The gastroesophageal junction (GEJ) is
the area where the esophagus and stomach join together. Given its anatomic location, GEJ adenocarcinomas have often been grouped
together with either esophageal or gastric cancers in large. Gastric adenocarcinoma (gastric cancer) remains one of the most common
and deadly cancers worldwide, especially among older malesi. Based on GLOBOCAN 2018 data, stomach cancer is the 5th
most common neoplasm and the 3rd most deadly cancer, with an estimated 783,000 deaths in 2018i. Gastric
cancer incidence and mortality are highly variable by region and highly dependent on diet and Helicobacter pylori infectioni.
About Leap Therapeutics
Leap Therapeutics (Nasdaq:LPTX) is focused
on developing targeted and immuno-oncology therapeutics. Leap's most advanced clinical candidate, DKN-01, is a humanized monoclonal
antibody targeting the Dickkopf-1 (DKK1) protein, a Wnt pathway modulator. DKN-01 is in clinical trials in patients with esophagogastric,
hepatobiliary, gynecologic, and prostate cancers. For more information about Leap Therapeutics, visit http://www.leaptx.com
or our public filings with the SEC that are available via EDGAR at http://www.sec.gov or via https://investors.leaptx.com/.
BeiGene (Nasdaq:BGNE; HKEX: 06160) is
a global, commercial-stage research-based biotechnology company focused on molecularly-targeted and immune-oncology cancer therapeutics.
With a team of over 3,300 employees in the United States, China, Australia, and Europe, BeiGene is advancing a pipeline consisting
of novel oral small molecules and monoclonal antibodies for cancer. BeiGene is also working to create combination solutions aimed
to have both a meaningful and lasting impact on cancer patients. In the United States, BeiGene markets and distributes BRUKINSA
(zanubrutinib) and in China, the Company has received approval to market its anti-PD-1 antibody tislelizumab and markets ABRAXANE
(nanoparticle albumin-bound paclitaxel), REVLIMID (lenalidomide), and VIDAZA (azacytidine) under a license from Celegene
Corporation Logistics Sarl, a Bristol-Myers Squibb companyii, and plans to market XGEVA (denosumab) under a
license from Amgeniii.
FORWARD-LOOKING STATEMENTS FOR LEAP
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934
and the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties. These statements include statements