GSK plc (NYSE:GSK) subsidiary, Tesaro Inc., has initiated litigation against AnaptysBio, Inc. (NASDAQ:ANAB) in the Delaware Chancery Court.
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GSK acquired Tesaro in December 2018 for approximately $5.1 billion (4.0 billion British pounds)
The action contends that recent conduct by AnaptysBio is in material breach of the existing license agreement with TESARO regarding the oncology treatment Jemperli (dostarlimab).
The breach entitles TESARO to terminate the current license agreement, obtain a perpetual and irrevocable license to dostarlimab, and reduce the royalties and milestone payments due by TESARO to AnaptysBio by 50%.
Also Read: AnaptysBio Charts Path To Split Into Two Public Companies By 2026
TESARO has initiated this litigation following allegations made by AnaptysBio that TESARO has not fulfilled certain requirements of the license agreement entered into in March 2014 and that AnaptysBio intends to revoke TESARO’s license for dostarlimab.
What Led To This High-Stakes Litigation?
Under the terms of the agreement announced in March 2014, TESARO paid an upfront license fee of $17 million, and funding for costs incurred by AnaptysBio related to the development programs.
For each development program, AnaptysBio was eligible to receive milestone payments of $18 million and an additional $90 million associated with certain U.S. and ex-U.S. regulatory submissions and approvals in multiple indications.
In December 2014, the companies expanded their collaboration and exclusive license agreement to include the development of a bispecific antibody candidate to target two undisclosed immune checkpoints.
GSK and TESARO are firmly of the view that these allegations are entirely without merit.
Jemperli is currently approved in over 35 countries for use in certain endometrial cancers, the most common gynaecologic cancer in the United States.
A clinical trial program to evaluate the potential use of dostarlimab in additional cancers, including rectal, colon, and head and neck, is ongoing.
Concurrently, AnaptysBio authorized an amended Stock Repurchase Plan of up to $100 million.
Excluding any additional potential purchases, Anaptys anticipates ending 2025 with approximately $300 million in cash, cash equivalents, and investments, including an anticipated accrual of a one-time $75 million commercial sales milestone in the fourth quarter of 2025 due from GSK once Jemperli achieves $1 billion in worldwide net sales.
Earlier in November, AnaptysBio said investigational rosnilimab was safe and well-tolerated; however, it did not meet the primary endpoint of the mean change from baseline in the modified Mayo Score (severity of ulcerative colitis, mMS) or the key secondary endpoints of clinical response and clinical remission at Week 12.
The company said to discontinue the ulcerative colitis trial, resulting in at least $10 million in savings.
ANAB Price Action: AnaptysBio shares were down 12.37% at $33.00 during premarket trading on Thursday, according to Benzinga Pro data.
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