Epizyme, a clinical stage biopharmaceutical company creating novel epigenetic therapies for cancer patients, has amended and restated its agreement with Celgene Corporation to extend the research collaboration between the two companies for at least three additional years.

Under the collaboration, Celgene will have the option to license histone methyltransferase (HMT) inhibitors being developed by Epizyme against three predefined targets.

Under the terms of the revised agreement:

• Epizyme will receive a $10 million extension fee from Celgene in return for an option to individually license global rights for two of the targets and ex-US rights for the third target.
• Celgene may exercise its option with respect to each of the targets at the time of the IND filing for an additional pre-specified license payment.
• Epizyme will be responsible for leading and funding development for each target candidate through phase 1 clinical trials.
• Following the completion of phase 1, if Celgene chooses to continue its license for a specific target, it may do so by making an additional pre-specified payment.
• Epizyme may earn total potential milestones of up to $610 million on the three targets, including up to $75 million in development milestones and license fees, $365 million in regulatory milestones, and $170 million in sales milestones
• Epizyme also may earn a royalty of up to a low double-digit percentage on worldwide net sales for two of the product candidates, and on ex-US net sales for the third product candidate.
• Epizyme will retain global rights to the remainder of its pipeline, as Celgene's option to license ex-US rights for any other preclinical programs will terminate.

In addition, Celgene will retain its ex-US license to, and the companies will continue their ongoing clinical collaboration on, pinometostat (EPZ-5676), a HMT inhibitor targeting DOT1L. Pinometostat is in phase 1 development for the treatment of patients with acute leukemia with alterations in the MLL gene (MLL-r).

"We believe that the extension of our agreement with Celgene will accelerate our goal of developing new therapies that have the potential to help many patients with epigenetically driven cancers," said Robert Gould, Ph.D., President and Chief Executive Officer, Epizyme. "Celgene is a leading company in oncology development and commercialization and we are pleased to continue our partnership on pinometostat and these three exciting novel targets."

The term of this agreement is based on specific development milestones, including the timing of IND filings and completion of phase 1 studies, but will extend for a minimum of three years. In addition, Celgene will no longer have the right of first negotiation on a business combination with Epizyme.

The Company also announced today that, based on its current operating plans, it projects that its cash and cash equivalents will be sufficient to fund operations through at least the end of the second quarter of 2017, prior to including any potential option exercise fees or future milestone payments.

This new cash outlook reflects a significant reallocation of resources, implementation of cost savings initiatives, the additional capital provided from the Celgene extension fee payment and the partial exercise of the overallotment option in April from the Company's March public financing.

"We have increased investment in tazemetostat development, both as a single agent and in future studies in combination with other agents," said Andrew Singer, Executive Vice President and Chief Financial Officer at Epizyme.

"This required reprioritizing our pipeline development plans and reducing operating costs. We are excited about the updated data from our dose escalation and dose expansion studies presented at the International Congress on Malignant Lymphoma in Lugano, Switzerland on June 20. We look forward to presenting additional data at the European Society for Medical Oncology's European Cancer Congress in Vienna, Austria on September 26."

Source: Company Press Release