Puma Biotechnology Announces Amendment To Neratinib Licensing Agreement With Pfizer

Puma Biotechnology, Inc.

, a development stage biopharmaceutical company, announced an amendment to its licensing agreement with Pfizer for Puma's investigational drug PB272 (neratinib). Puma is currently developing PB272 for the treatment of patients with HER2-positive breast cancer and patients with non-small cell lung cancer, breast cancer and other solid tumors that have a HER2 mutation. At the time that Puma licensed PB272 from Pfizer, a number of ongoing clinical trials (legacy clinical trials) that had been previously initiated by Pfizer were transferred to Puma. The original license agreement set a limit on the amount of external expenses that Puma would incur in completing these legacy clinical trials. Puma reached this limit in the fourth quarter of 2012. The original license agreement also provided that Pfizer would be responsible for all expenses for these ongoing legacy trials above the pre-determined limit until the trials were completed. The amendment to the license agreement provides that Puma will now be solely responsible for the expenses associated with the ongoing legacy clinical trials. Puma anticipates that this will result in an increase in research and development expenses, which will total approximately $30 million. Puma further anticipates that a significant percentage of this approximately $30 million will occur in 2014 and will decrease over time until the trials are completed. In addition, according to the terms of the original license agreement, upon commercialization of neratinib, Puma is obligated to pay Pfizer incremental annual royalties ranging between 10 to 20 percent of net sales of neratinib. Under the terms of the amendment to the license agreement, upon commercialization of neratinib, Puma will be obligated to pay Pfizer annual royalties on net sales of neratinib at a fixed rate in the low- to mid- teens. “We are pleased to enter into this amendment to the licensing agreement for neratinib. By assuming responsibility for the expenses associated with the ongoing legacy clinical trials, and by fixing the royalty rate for the drug at a reduced rate, we believe that we have significantly improved the potential value of the drug,” said Alan H. Auerbach, Chief Executive Officer and President.