Agreements with Adimab
Certain of our current and former directors and officers are affiliated with Adimab, the beneficial owner of 24.4% of our common stock as of March 27,
2023. Tillman U. Gerngross, Ph.D., our co-founder, former member of our Board and our former Chief Executive Officer, is co-founder and Executive Chairman of the board of directors of Adimab and former Chief Executive Officer of Adimab. Laura
Walker, Ph.D., our co-founder and former Chief Scientific Officer, was the Senior Director of Antibody Sciences at Adimab. Terrance McGuire, who is deemed to be a beneficial owner of 7.9% of our common stock
as of March 27, 2023 is a member of our Board and the board of directors of Adimab.
Assignment and License Agreement
In July 2020, we entered into an assignment and license agreement (the Adimab Assignment Agreement) with Adimab pursuant to which
Adimab assigned to us its rights to all coronavirus antibodies controlled by it and their derivatives, patents claiming such antibodies, know-how related to such antibodies, and biological and chemical
materials specifically related to such antibodies, and also granted us a non-exclusive, sublicensable, worldwide, royalty-bearing license to certain of its antibody discovery and optimization platform
technology to research, develop, make, use and sell coronavirus antibodies and products containing or comprising coronavirus antibodies, provided that we may not use such licensed rights to discover or optimize antibodies. In connection with the
transfer of the rights acquired and license received, we issued to Adimab 5,000,000 shares of our Series A preferred stock, then having a fair value of $40.0 million. Concurrently, Adimab relinquished to us 21,250,000 shares of our common
stock, then having a fair value of $85,000.
Under the Adimab Assignment Agreement, we are obligated to pay Adimab quarterly for its services performed
under the agreement at a specified full-time equivalent rate. We are obligated to pay Adimab up to $24.6 million upon the achievement of specified development and regulatory milestones for the first two products that comprise or contain
coronavirus antibodies assigned to us, antibodies discovered or optimized under the Adimab Assignment Agreement, or any derivative of such antibody (the Products). We are also obligated to pay Adimab royalties of a mid-single-digit percentage based on annual aggregate worldwide net sales of any Products, subject to reductions for third-party licenses, biosimilar competition, compulsory licensing and a royalty floor.
In February 2021, we achieved the first specified milestone under the agreement upon dosing of the first patient in a Phase 1 global clinical trial evaluating
adintrevimab, which obligated us to make a $1.0 million payment to Adimab. We made the payment in March 2021. In April 2021, we achieved the second specified milestone under the agreement upon dosing of the first patient in a Phase 2 global
clinical trial evaluating adintrevimab for the prevention of COVID-19, which obligated us to make a $2.5 million payment to Adimab. We made the payment in June 2021. In August 2021, we achieved the third
specified milestone under the agreement upon dosing of the first patient in a Phase 3 global clinical trial evaluating adintrevimab for the prevention of COVID-19, which obligated us to make a
$4.0 million payment to Adimab. We made the payment in September 2021.
From January 1, 2021 through December 31, 2022, we paid Adimab
$9.8 million in connection with the Adimab Assignment Agreement. As of December 31, 2022, less than $0.1 million was due to Adimab by us.
Collaboration Agreement
In May
2021, we entered into a collaboration agreement with Adimab (the Adimab Collaboration Agreement) for the discovery and optimization of proprietary antibodies as potential therapeutic product candidates. We are obligated to pay Adimab a
quarterly fee of $1.3 million in exchange for Adimab and its affiliates agreeing not to assist in the discovery or optimization of or to direct certain third parties to discover or optimize antibodies that are intended to bind to coronaviruses
or influenza viruses, which obligation may be cancelled at our option at any time.
For each agreed upon research program that is commenced under the
Adimab Collaboration Agreement, we are obligated to pay Adimab quarterly for its services performed during a given research program at a specified full-time equivalent rate, a discovery delivery fee of $0.2 million, and an optimization
completion fee of $0.2 million. For each option exercised by us to commercialize a specific research program, we are obligated to pay Adimab an exercise fee of $1.0 million.
We are obligated to pay Adimab up to $18.0 million upon the achievement of specified development and regulatory milestones for each product under the
agreement that achieves such milestones. We are also obligated to pay Adimab royalties of a mid-single-digit percentage based on annual aggregate worldwide net sales of products, subject to reductions for
third-party licenses.
In addition, we are obligated to pay Adimab for Adimabs performance of certain validation work with respect to certain
antigens acquired from a third party. In consideration for this work, we are obligated to pay Adimab royalties of a low single-digit percentage based on annual aggregate worldwide net sales of products that contain such antigens for the same royalty
term as antibody-based products, but we are not obligated to make any milestone payments for such antigen products.
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