UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): December 4, 2018
VBI VACCINES INC.
(Exact name of registrant as specified in its charter)
| British Columbia, Canada | 001-37769 | N/A | ||
| (State
or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS
Employer Identification No.) |
222 Third Street, Suite 2241 Cambridge, Massachusetts |
02142 | |
| (Address of principal executive offices) | (Zip Code) |
(617) 830-3031
(Registrant’s telephone number, including area code)
N/A
(Former Name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| [ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company [X]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [X]
Item 1.01 Entry into a Material Definitive Agreement.
On December 4, 2018, VBI Vaccines Inc. (the “Company”) entered into a license and collaboration agreement (the “License Agreement”) with Brii Biosciences Limited (“Brii Bio”), pursuant to which, among other things, subject to terms and conditions set forth in the License Agreement:
| (i) | the Company and Brii Bio agreed to collaborate on the development of a hepatitis B recombinant protein-based immunotherapeutic in the licensed territory, which consists of China, Hong Kong, Taiwan and Macau (collectively, the “Licensed Territory”), and to conduct a Phase II collaboration clinical trial for the purpose of comparing VBI-2601, which is a recombinant protein-based immunotherapeutic developed by the Company for use in treating hepatitis B, and a novel composition (the “Novel Composition”), which is a new recombinant protein-based immunotherapeutic formulation that includes a Brii Bio adjuvant and a licensed compound of the Company; | |
| (ii) | the Company granted Brii Bio an exclusive royalty-bearing license to perform studies, and regulatory and other activities, as may be required to obtain and maintain marketing approval for the licensed product, which is either VBI-2601 or the Novel Composition (the “Licensed Product”), for the treatment of hepatitis B in the Licensed Territory and to commercialize and promote the Licensed Product for the diagnosis and treatment of hepatitis B in the Licensed Territory; and | |
| (iii) | Brii Bio granted the Company an exclusive royalty-free license under Brii Bio’s technology and Brii Bio’s interest in any joint technology developed during the collaboration to develop and commercialize the Licensed Product for the diagnosis and treatment of hepatitis B in the countries of the world other than the Licensed Territory. |
Pursuant to the License Agreement and the initial development plan, Brii Bio shall fund all clinical trials for the Licensed Territory. The Company and Brii Bio will jointly own all rights, title and interest in the joint know-how developed and the patents claiming joint inventions made pursuant to the License Agreement. Outside of the field of the diagnosis and treatment of hepatitis B, the Company will not have any right to practice the joint technology in the countries outside of the Licensed Territory unless and until the parties have negotiated a separate license agreement.
As part of the consideration for the collaboration, the Company received from Brii Bio a total upfront payment of $11 million, consisting of a $4 million upfront payment and a $7 million equity investment. The Company is also eligible to receive an additional $117.5 million in potential milestone payments, along with potential low double-digit royalties on commercial sales in the Licensed Territory. In connection with the equity investment, the Company and Brii Bio entered into a stock purchase agreement, dated as of December 4, 2018, pursuant to which the Company issued to Brii Bio an aggregate of 2,295,082 common shares (the “Brii Bio Shares”) in exchange for $7 million, or $3.05 per share.
The License Agreement will be in effect until the last-to-expire of the latest of the following terms in each region of the Licensed Territory: (i) expiration, invalidation or lapse of the last Company patent claiming a Licensed Product, (ii) 10 years from the date of first commercial sale of a Licensed Product in the applicable region, or (iii) termination or expiration of the Company’s obligation to pay third party royalties with respect to sales of a Licensed Product. Upon expiration (but not an earlier termination) of the License Agreement in each region of the Licensed Territory, the Company will grant Brii Bio a perpetual, non-exclusive, fully paid-up, royalty free license under the Company’s technology related to the licensed compounds or Licensed Products pursuant to the License Agreement in such region to make and sell Licensed Products for the diagnosis and treatment of hepatitis B in such region. Each party may terminate the License Agreement upon a material breach of the License Agreement which has not been cured within 60 days (or 30 days for a breach payment obligations) after notice from the terminating party requesting cure of the breach, or upon bankruptcy or insolvency, either voluntary or involuntary, dissolution or liquidation of a party. In addition, Brii Bio may terminate the License Agreement without cause upon 180 days’ notice or, if a Data and Safety Monitoring Board or any regulatory authority in the Licensed Territory imposes a clinical hold on any clinical trial for a Licensed Product for six consecutive months, immediately upon notice. The Company may terminate the License Agreement immediately upon notice, if Brii Bio or its affiliates, directly, or indirectly through any third party, commences any interference or opposition proceeding with respect to, challenges the validity or enforceability of, or opposes any extension of or the grant of a supplementary protection certificate with respect to, any patents owned or controlled by the Company related to the composition or the method of making or using licensed compounds or Licensed Products, or are otherwise necessary or useful to research, develop, make, or otherwise commercialize the licensed compounds or Licensed Products.
The License Agreement also contains mutual confidentiality and indemnification obligations for the Company and Brii Bio.
Prior to the Company’s entering into the License Agreement, the Company paid $6 million to terminate a distribution agreement with a third party who previously held certain distribution rights to certain Asian markets.
Item 3.02 Unregistered Sales of Equity Securities.
The information regarding the issuance of the Brii Bio Shares set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference. The issuance of the Brii Bio Shares was not registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state, and was issued in reliance on the exemption from registration under the Securities Act provided by Section 4(a)(2) and Regulation D (Rule 506) under the Securities Act. Brii Bio represented that it was an accredited investor (as defined by Rule 501 under the Securities Act).
Item 8.01 Other Events.
On December 6, 2018, the Company issued a press release announcing execution of the License Agreement. A copy of the press release is attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | |
| 99.1 | Press release, dated December 6, 2018 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| VBI Vaccines Inc. | ||
| Date: December 6, 2018 | By: | /s/ Jeff Baxter |
| Jeff Baxter | ||
| President and Chief Executive Officer | ||
VBI Vaccines Enters into License and Collaboration Agreement
with Brii Biosciences for up to $129 Million plus Royalties to Develop a Functional Cure for Hepatitis B
| - | Upon closing, VBI received gross proceeds of $11 million, consisting of an upfront payment and an equity investment at $3.05 per share from Brii Biosciences | |
| - | VBI is eligible to receive an additional $117.5 million in potential milestone payments and potential double-digit royalties on commercial sales in the licensed territory - China, Taiwan, Macau, and Hong Kong |
CAMBRIDGE, Mass. (December 6, 2018) – VBI Vaccines Inc. (NASDAQ: VBIV) (“VBI”), a commercial-stage biopharmaceutical company developing next-generation infectious disease and immuno-oncology vaccines, today announced that it entered into a license and collaboration agreement with Brii Biosciences, a company committed to serving patients’ needs and improving public health in China, for the development of a functional cure for the treatment of chronic hepatitis B infection, using VBI’s recombinant, protein-based immuno-therapeutic, VBI-2601.
As part of the collaboration, Brii Bio paid VBI an upfront payment of $11 million, consisting of a $4 million upfront payment and a $7 million equity investment priced at $3.05 per share. VBI is also eligible to receive an additional $117.5 million in potential milestone payments, and potential double-digit royalties on commercial sales in the licensed territory, which includes China, Hong Kong, Macau, and Taiwan.
“I am very excited to announce this partnership with Brii Bio, which leverages our hepatitis B expertise and marks our pipeline expansion into the therapeutic setting,” said Jeff Baxter, President and CEO of VBI. “Brii Bio is uniquely positioned to accelerate infectious disease drug development and commercialization in China due to their world-class leadership, investors, and foundational and strategic partnerships. We believe this collaboration creates a promising opportunity to quickly and effectively develop a cure for chronic hepatitis B patients.”
“Chronic hepatitis B is one of the world’s most serious infectious disease burdens, and one that is particularly endemic in China,” said Dr. Zhi Hong, Ph.D., co-founder and CEO of Brii Bio. “We believe VBI’s immuno-therapeutic has the potential to be a differentiated, and perhaps vital, component of a functional cure. This collaboration is a significant step forward as we work to deliver on our mission to improve public health in China.” Additional details were announced by Brii Bio today.
Under the agreement, VBI and Brii Bio will collaborate in the development of the product through to completion of a proof-of-concept clinical trial in China, following which, Brii Bio will be responsible for funding all development in the licensed territory. Brii Bio will retain commercial rights in the licensed territory, while VBI will retain all rights outside of the licensed territory. Additional information regarding this deal can be found in VBI’s associated Current Report on Form 8-K filed today with the U.S. Securities and Exchange Commission (SEC) and available through the SEC’s website at http://www.sec.gov.
VBI-2601 has the potential to contribute to a functional cure by inducing and sustaining broad and effective immunity against Hepatitis B. VBI-2601 is uniquely formulated to target both B-cell and T-cell immunity through multiple mechanisms of action, including neutralizing the circulating hepatitis B virus, blocking hepatitis B infection of hepatocytes mediated through Pre-S1, and enabling immune-mediated clearance of infected hepatocytes.
Hepatitis B is one of the world’s most significant infectious disease threats with over 250 million people infected globally. Chronic infection can lead to cirrhosis of the liver, hepatocellular cancer, and other liver disease, making it a life-threatening global health problem. Current hepatitis B therapies have proven to achieve a functional cure in less than 20 percent of those treated.
About VBI Vaccines Inc.
VBI Vaccines Inc. (“VBI”) is a commercial-stage biopharmaceutical company developing a next generation of vaccines to address unmet needs in infectious disease and immuno-oncology. VBI’s first marketed product is Sci-B-Vac®, a hepatitis B (HBV) vaccine that mimics all three viral surface antigens of the hepatitis B virus; Sci-B-Vac® is approved for use in Israel and 10 other countries. VBI’s eVLP Platform technology enables the development of enveloped virus-like particle (eVLP) vaccines that closely mimic the target virus to elicit a potent immune response. VBI is advancing a pipeline of eVLP vaccines, with lead programs in cytomegalovirus (CMV) and glioblastoma (GBM). VBI is headquartered in Cambridge, MA with research operations in Ottawa, Canada and research and manufacturing facilities in Rehovot, Israel.
| ● | Website Home: http://www.vbivaccines.com/ | |
| ● | News and Insights: http://www.vbivaccines.com/wire/ | |
| ● | Investors: http://www.vbivaccines.com/investors/ |
Cautionary Statement on Forward-looking Information
Certain statements in this press release that are forward-looking and not statements of historical fact are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are forward-looking information within the meaning of Canadian securities laws (collectively, “forward-looking statements”). The company cautions that such statements involve risks and uncertainties that may materially affect the company’s results of operations. Such forward-looking statements are based on the beliefs of management as well as assumptions made by and information currently available to management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors, including but not limited to the ability to establish that potential products are efficacious or safe in preclinical or clinical trials; the ability to establish or maintain collaborations on the development of therapeutic candidates; the ability to obtain appropriate or necessary governmental approvals to market potential products; the ability to obtain future funding for developmental products and working capital and to obtain such funding on commercially reasonable terms; the company’s ability to manufacture product candidates on a commercial scale or in collaborations with third parties; changes in the size and nature of competitors; the ability to retain key executives and scientists; and the ability to secure and enforce legal rights related to the company’s products. A discussion of these and other factors, including risks and uncertainties with respect to the company, is set forth in the Company’s filings with the Securities and Exchange Commission and the Canadian securities authorities, including its Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 26, 2018, and filed with the Canadian security authorities at sedar.com on February 26, 2018, as may be supplemented or amended by the Company’s Quarterly Reports on Form 10-Q. Given these risks, uncertainties and factors, you are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. All such forward-looking statements made herein are based on our current expectations and we undertake no duty or obligation to update or revise any forward-looking statements for any reason, except as required by law.
VBI Contact
Nicole Anderson, Communications Executive
Phone: (617) 830-3031 x124
Email: info@vbivaccines.com
VBI Investor Contact
Nell Beattie
Chief Business Officer
Email: IR@vbivaccines.com
VBI Media Contact
Burns McClellan, Inc.
Robert Flamm, Ph.D. / Nancie Steinberg
Phone: (212) 213-0006
Email: rflamm@burnsmc.com / nsteinberg@burnsmc.com