On August 27, 2024 (the "Closing Date"), Arcus Biosciences, Inc. (the "Company") reported to have entered into a Loan and Security Agreement (the "LSA"), by and among the Company, the several banks and other financial institutions or entities party thereto, as lenders, and Hercules Capital, Inc. ("Hercules"), as administrative agent and collateral agent (Filing, 8-K, Arcus Biosciences, AUG 27, 2024, View Source [SID1234646113]).

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The LSA provides a secured term loan facility of up to $250.0 million (collectively, the "Term Loans"), consisting of: (a) an initial $50.0 million tranche of term loans, which was funded on the Closing Date; (b) an additional tranche of term loans in an aggregate amount of $50.0 million that is available at the Company’s sole option, subject to customary terms and conditions, through June 15, 2025; (c) an additional tranche of term loans in an aggregate amount of $50.0 million that is available at the Company’s sole option, subject to customary terms and conditions, through March 15, 2026 (the amounts listed in (a), (b) and (c) above, the "Initial Tranches") and (d) an additional tranche of term loans in an aggregate amount of $100.0 million (the "Final Tranche"), which will be available at the lenders’ sole option, subject to customary terms and conditions, in $25.0 million increments. On the Closing Date, the Company paid an initial facility charge for the Initial Tranches equal to $1.125 million.

Borrowings under the LSA bear interest at a per annum rate equal to: (a) in cash, the greater of either (i) the Prime Rate (as reported in the Wall Street Journal) plus 1.95% and (ii) 10.45%. The Term Loans are repayable in monthly interest-only payments until September 1, 2028 (the "Interest-Only Payment Period"). The Company may extend the Interest-Only Payment Period an additional 12 months if (i) no default or event of default exists under the LSA and (ii) by August 27, 2028, the U.S. Food and Drug Administration has approved either a Biologics License Application or New Drug Application ("Milestone I"). After the expiration of the Interest-Only Payment Period, the Term Loans are repayable in equal monthly payments of principal and accrued interest until maturity.
The Term Loans will mature on September 1, 2029 (the "Maturity Date"). The Company may extend the Maturity Date up to an additional 12 months if (i) no default or event of default exists and (ii) the Company has accomplished two of the following events ("Milestone II"): (a) dosing the first patient in a pivotal phase 3 study of casdatifan for the treatment of renal cell carcinoma; (b) dosing the first patient in a pivotal phase 3 study of quemliclustat in patients with advanced pancreatic cancer; or (c) dosing the first patient in a pivotal phase 3 study of etrumadenant in patients with metastatic colorectal cancer.

At the Company’s option, the Company may prepay all or a portion of the outstanding Term Loans, subject to a prepayment premium equal to (a) 3.0% of the Term Loans being prepaid if the prepayment occurs during the 12 months following the Closing Date; (b) 2.0% of the Term Loans being prepaid if the prepayment occurs after the 12 month anniversary of the Closing Date but on or prior to the 24 month anniversary of the Closing Date; and (c) 1.0% of the Term Loans being prepaid if the prepayment occurs at least 24 months following the Closing Date and prior to the Maturity Date. In addition, the Company will pay an end of term charge of 7.75% upon the prepayment or repayment of the Term Loans and a facility charge of 0.75% upon any draws of the Term Loans from the Final Tranche.

The Term Loans are secured by a lien on substantially all of the assets of the Company other than any assets subject to an option held by Gilead Sciences, Inc. or Taiho Pharmaceutical Co., Ltd. The LSA includes a financial covenant that requires the Company to maintain, at all times during which the Company’s market capitalization is at or below $1.20 billion, "Qualified Cash" (defined as cash in accounts subject to control agreements minus any accounts payable not paid after the 120th day) in an amount greater than or equal to the outstanding principal amount of the Term Loans, multiplied by 50% (the "Qualified Cash Requirement Threshold"). The Qualified Cash Requirement Threshold will be decreased (a) to 40% upon accomplishing Milestone I and (b) to 35% upon accomplishing Milestone II.
In addition, the LSA includes customary affirmative and negative covenants and representations and warranties, including a covenant against the occurrence of a "change in control," financial reporting obligations, and certain limitations on indebtedness, liens, investments, distributions (including dividends), collateral, transfers, mergers or acquisitions, taxes, corporate changes, and bank accounts. The LSA also includes customary events of default, including payment defaults, breaches of covenants following any applicable cure period, the occurrence of certain events that could reasonably be expected to have a "material adverse effect" as set forth in the LSA, cross acceleration to third-party indebtedness and certain events relating to bankruptcy or insolvency. Upon the occurrence of an event of default, Hercules may declare all outstanding obligations immediately due and payable and take such other actions as set forth in the LSA.

The foregoing is only a brief description of the material terms of the LSA does not purport to be a complete description of the rights and obligations of the parties thereunder and is qualified in its entirety by reference to such agreement, which will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2024.

On August 27, 2024 Transgene (Euronext Paris: TNG), a biotech company that designs and develops virus-based immunotherapies for the treatment of cancer, reported the publication in the Journal for ImmunoTherapy of Cancer (JITC) of a peer-reviewed article which illustrates that TG6050 induces profound immune remodeling of the tumor microenvironment in animal models (Press release, Transgene, AUG 27, 2024, View Source [SID1234646104]). The paper highlights TG6050’s potential to induce sustained intratumoral expression of interleukin-12 (IL-12) and anti-cytotoxic T-lymphocyte associated antigen-4 (CTLA-4) antibody at active concentrations without the toxicity observed with systemic administration.

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TG6050 is an oncolytic virus derived from Transgene’s invir.IO platform encoding interleukin-12 (IL-12) and an anti-CTLA4 antibody, with the potential to trigger a powerful localized antitumor immune response.

The JITC paper reports that in addition to consistent multiplication and propagation of TG6050 in tumor cells, functional transgenes are expressed in the tumor with a sustained intratumoral accumulation of IL-12 and anti-CTLA-4 antibody. The three components of TG6050 (oncolytic viral backbone, IL-12 and anti-CTLA-4 antibody transgenes) act together to induce tumor regression in numerous "hot" and "cold" murine tumor models investigated in these studies. This antitumoral activity was further amplified when TG6050 was combined with an anti-PD1.

Moreover, these studies show that TG6050 triggers a strong adaptive antitumoral immune response, accompanied by a profound modification of the tumor microenvironment based on infiltration of both innate and adaptive immune cells, altering it to a more inflamed state (from "cold" to "hot").

TG6050 was also shown to be safe. Upon intravenous administration in non-human primates for toxicology evaluation, it did not induce any of the IL-12 related adverse effects that are associated with systemic administration. TG6050 has now progressed into Phase 1 clinical development (the Delivir trial) in metastatic non-small cell lung cancer (NCT05788926).

"These strong preclinical data demonstrate the ability of our invir.IO oncolytic virus platform to generate promising candidates for further development and support our decision to advance TG6050 into the clinic in metastatic non-small cell lung cancer. We have thoroughly explored the mechanism of action of TG6050, with local delivery of functional IL-12 and anti-CTLA-4 resulting in strong antitumor activity. Moreover, in toxicology studies after repeated intravenous administrations in non-human primates, TG6050 did not display any observable adverse effects," commented Dr. Maud Brandely, MD, PhD, Chief Medical Officer of Transgene.

The JITC paper is titled "TG6050, an oncolytic vaccinia virus encoding interleukin-12 and anti-CTLA-4 antibody, favors tumor regression via profound immune remodeling of the tumor microenvironment" and can be accessed here.

About TG6050

TG6050 is an oncolytic virus developed with Transgene’s invir.IO platform for intravenous administration. invir.IO viruses are based on the patented large capacity Vaccinia virus Copenhagen strain genetically modified with the double deletion TK-RR- (VVCOPTK-RR-). TG6050 has been engineered to encode human IL-12, a cytokine that triggers a powerful antitumor immune response and a full length anti-CTLA4 antibody. It has also been optimized with the deletion of the gene encoding for the M2L viral protein that targets CD80 and CD86, two ligands of CD28 [source: Kleinpeter et al., J Virol. 2019 Jun 1 ; 93(11) : e00207-19]. The use of an oncolytic virus to deliver these immunotherapies locally and selectively in the tumor microenvironment allows high intratumoral concentrations of both therapeutic proteins eliciting a stronger and more effective antitumor response. By reducing systemic exposure to a very low level, this local therapeutic activity furthermore allows an increase in the safety and tolerability profile of IL-12 and the anti-CTLA4 antibody.

TG6050 is being evaluated in the Deliver trial, a Phase I trial conducted in advanced non-small cell lung cancer (NSCLC) patients.

About the Delivir trial (NCT: 05788926)

The Delivir trial is a multicenter, open label, dose-escalation Phase I trial evaluating TG6050 as a single agent. The trial will enroll up to 36 patients with metastatic/advanced NSCLC, who have failed standard therapeutic options including immunotherapies such as immune checkpoint inhibitors. Patients will receive single and repeated escalating doses of TG6050 administered intravenously, to determine the recommended dose and best schedule of administration for subsequent clinical development.

On August 27, 2024 Astellas Pharma Inc. (TSE: 4503, President and CEO: Naoki Okamura, "Astellas") reported dosing of the first patient in the HIGHLIGHT 1 Phase 3 pivotal study for fezolinetant, an investigational oral, nonhormonal compound being studied for the treatment of moderate to severe vasomotor symptoms (VMS) in women with breast cancer receiving adjuvant endocrine therapy (Press release, Astellas, AUG 27, 2024, View Source [SID1234646103]).

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Breast cancer is the most common cancer in women globally, with approximately 2.3 million new cases in 2022.1 Hot flashes and night sweats, also known as VMS, are recognized as the most prominent side effect of adjuvant endocrine therapies used in the treatment of breast cancer. Approximately 77% of breast cancers can be treated with adjuvant endocrine therapies,2 most commonly tamoxifen and aromatase inhibitors, and up to 97% of breast cancer patients experience hot flashes or night sweats.3

Marci English, Vice President, Head of BioPharma Development, Astellas
"VMS can adversely affect quality of life, as well as compliance with treatment, for patients with breast cancer taking adjuvant endocrine therapy. We are excited to get the HIGHLIGHT 1 study underway, as currently there are no approved treatments for moderate to severe VMS that can be used by these patients."

About HIGHLIGHT 1
HIGHLIGHT 1 (NCT06440967) is a randomized, placebo-controlled, double-blind, Phase 3 clinical study to assess the efficacy and safety of fezolinetant for the treatment of moderate to severe VMS in women with stage 0 to 3 hormone receptor-positive breast cancer who are receiving adjuvant endocrine therapy. Approximately 540 participants are planned to be randomized 1:1 to fezolinetant or placebo at up to 100 sites globally. The four coprimary endpoints are change in the frequency and severity of moderate to severe VMS from baseline to weeks 4 and 12. Patients will be treated for 52 weeks with a final evaluation at 55 weeks.

About Fezolinetant
Fezolinetant is an investigational oral, nonhormonal medicine in clinical development for the treatment of moderate to severe vasomotor symptoms (VMS) in women with breast cancer receiving adjuvant endocrine therapy. The safety and efficacy of fezolinetant have not been established in this patient population. VMS are also known as hot flashes or night sweats. Fezolinetant works by blocking neurokinin B (NKB) binding on the kisspeptin/neurokinin/dynorphin (KNDy) neuron, helping restore the balance in the brain’s temperature control center (the hypothalamus) to reduce the number and intensity of hot flashes and night sweats.4,5,6 There is no guarantee the agent will receive regulatory approval or become commercially available for the uses being investigated.

On August 26, 2024 The South Korean biotech company GI Innovation reported that it has signed a clinical trial collaboration and supply agreement with MSD (a tradename of Merck& Co., Inc., Rahway, NJ, USA) to evaluate the combination of GI-102 and MSD’s anti-PD-1 therapy, KEYTRUDA (pembrolizumab) in patients with immunotherapy-resistant liver cancer, melanoma, and renal cell carcinoma (Press release, GI Innovation, AUG 26, 2024, View Source [SID1234646110]).

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This agreement marks GI Innovation’s second clinical trial collaboration with MSD, following a previous collaboration for GI-101A.

The Phase 2 clinical trial including GI-102 in combination with KEYTRUDA will enroll patients with resistance or non-response to immuno-oncology treatments, leaving them with no further treatment options. GI Innovation is focused on three indications with significant market potential and potential likelihood of success: metastatic liver cancer, melanoma, and renal cell carcinoma. The company has already demonstrated strong anti-cancer efficacy with a 42.9% overall response rate (ORR) in a monotherapy trial of GI-102 in melanoma patients who failed to respond to standard-of-care treatment (3 partial responses out of 7 patients). Complete tumor regression was previously observed in 60% of mice treated with GI-102 monotherapy in a preclinical liver cancer model.

Fourteen hospitals in South Korea and world-renowned sites in the U.S. have agreed to join the trial, including the Mayo Clinic (campuses in Rochester, Florida, and Arizona), Cleveland Clinic and Memorial Sloan Kettering Cancer Center. In South Korea, the trial will take place at leading hospitals including Samsung Medical Center, Asan Medical Center, Seoul National University Hospital, Severance Hospital of Yonsei University, and St. Vincent’s Hospital.

"We are pleased to enter into another clinical trial collaboration and supply agreement with MSD, a world leader in immuno-oncology. We aim to maximize the therapeutic value of GI-102 by combining it with KEYTRUDA, MSD’s anti-PD-1 therapy", said Dr Myung-Ho Jang, GI Innovation’s Chief Scientific Officer.

KEYTRUDA is a registered trademark of Merck Sharp & Dohme LLC, a subsidiary of Merck & Co., Inc., Rahway NJ, USA.

On August 26, 2024 Diakonos Oncology Corp., a clinical-stage immuno-oncology company, reported the final closing of an oversubscribed seed financing of $11.4 million (Press release, Diakonos Oncology, AUG 26, 2024, View Source [SID1234646109]). The round was led by biotechnology investment firm Restem Group Inc., with participation from existing investors.

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To date, funds have enabled the company to establish manufacturing operations, add key leadership positions, and complete enrollment for the Phase 1 study of lead asset DOC1021 in the treatment of glioblastoma (GBM). The additional capital will fund operations into late 2025 and allow Diakonos to initiate the Phase 2 trial in GBM prior to closing a Series A round.

"We greatly appreciate the support of these investors in sharing our passion for improving the lives of patients suffering from deadly cancers such as glioblastoma," said Mike Wicks, Diakonos CEO. "The fact that this financing is nearly triple our initial target also shows they share our confidence in the effectiveness of our unique cancer therapy. This investment will fund operations through the final readout of key safety and efficacy data from our Phase 1 trial and will allow the company to ramp up preparations for pipeline expansion and the initiation of our Phase 2 GBM trial which is expected to begin in the fourth quarter of this year."

"We are thrilled to invest in this groundbreaking company that is at the forefront of cancer treatment innovation. As a firm deeply involved in the cell therapeutic field, we recognize the immense potential of their pioneering work with dendritic cell therapies and we are confident that this can become a new standard of care for cancer in the future," said Andres Isaias, Executive Chairman of Restem Group Inc.

About DOC1021

DOC1021 is a first-of-its-kind dendritic cell vaccine (DCV) that initiates a complete cytotoxic TH1 immune response against a patient’s cancer through our proprietary double loading technology. Enrollment in the two-year Phase 1 trial was completed in December 2023.

In addition to the lead GBM study, two other clinical trials of Diakonos’ DCV are ongoing for the treatment of pancreatic cancer and angiosarcoma. Diakonos has received Fast Track designations from the FDA for both the GBM and pancreatic cancer programs. The company has also received Orphan Drug Designation for the GBM program.

Diakonos’ DCVs activate robust cytotoxic TH1 cell signaling pathways that better harness a patient’s immune system to target and eliminate cancer cells. This is achieved without any genetic modification of the patient’s immune cells and without the need for toxic preconditioning.