On November 4, 2019 Tmunity Therapeutics, Inc., a private clinical-stage biotherapeutics company focused on saving and improving lives by delivering the full potential of next-generation T-cell immunotherapy, reported it has entered into a strategic collaboration with Oncora Medical to access Oncora’s proprietary real-world data platform to support the design of future clinical programs with cell therapy (Press release, Tmunity Therapeutics, NOV 4, 2019, View Source [SID1234550262]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Oncora brings to this collaboration a suite of intuitive analytics software that collects and deploys real-world clinical data that can be used to drive better decision making and treatment options and ultimately improve patient outcomes. Tmunity brings expertise in clinical oncology and clinical trial design, regulatory strategy and cell therapy. Together, this collaboration has the potential to innovate the way clinical trials for cell therapy are executed to bring treatments to patients more efficiently. Tmunity will leverage Oncora’s data and analytics capabilities to refine, customize and validate a real-world evidence strategy. Tmunity hopes to validate the strategy in a clinical program selected from its highly innovative pipeline.

"Partnering with Oncora Medical to utilize real-world data in clinical development puts Tmunity at the forefront of innovation. This project has the potential to help us more effectively design and execute our clinical trials to advance the next-generation of CAR-T therapies," said Usman "Oz" Azam, MD, President and Chief Executive Officer of Tmunity. "We are excited to begin our relationship with Oncora Medical to revolutionize the way clinical trials are designed with the ultimate goal of reducing the time to deliver targeted T-cell therapies to patients in need."

"We believe that use of real-world data and evidence has the potential to change the way cancer therapies are developed and to further personalize outcome predictions that will guide treatment decisions," said Oncora Medical co-founder and CEO, David Lindsay. "We hope our partnership with Tmunity will innovate the way clinical trials are designed and thereby, to bring important cancer treatments to patients more efficiently."

On November 4, 2019, Epizyme, Inc. (the "Company"), reported that it has entered into a Loan Agreement (the "Loan Agreement") with BioPharma Credit Investments V (Master) LP and BioPharma Credit PLC (the "Collateral Agent", and together with BioPharma Credit Investments V (Master) LP, the "Lenders"), providing for up to $70.0 million in secured term loans to be advanced in three tranches (Filing, 8-K, Epizyme, NOV 4, 2019, View Source [SID1234550209]). The Company may borrow $25.0 million under each of the first two tranches and $20 million under the third tranche. The Company will have the right to request up to an additional $300.0 million in secured term loans following U.S. Food and Drug Administration (the "FDA") approval of tazemetostat for the treatment of follicular lymphoma in the United States, provided that the Company has not prepaid any outstanding term loans at the time of such request and such request is made within two years of the closing of the first tranche of term loans.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

The effectiveness of the terms obligating the parties to perform under the Loan Agreement is subject to the consummation of the closing of the Purchase Agreement (as defined below) and other documentation conditions. The Company’s right to borrow, and the Lenders’ obligation to lend, under the first tranche is subject to the satisfaction of customary closing conditions. The Company’s right to borrow, and the Lenders’ obligation to lend, under the second tranche is subject to FDA approval of tazemetostat for the treatment of epithelioid sarcoma in the United States, among other closing conditions. The Company’s right to borrow, and the Lenders’ obligation to lend, under the third tranche is subject to FDA approval of tazemetostat for the treatment of follicular lymphoma in the United States, among other closing conditions. Unless the conditions are satisfied and the amounts are borrowed prior to such dates, the Lenders’ obligation to lend funds under the second tranche will expire on March 31, 2020, and the Lenders’ obligation to lend funds under the third tranche will expire on December 31, 2020.

Interest rates for the term loans will be determined by reference to a Eurodollar rate plus 7.75% above such Eurodollar rate. The Eurodollar rate will have a 2.00% floor. The term loans will be due in 8 equal quarterly principal payments commencing on the first business day on or following the 39th month anniversary of the date on which the Lenders fund the first tranche of term loans. All accrued and unpaid interest under any tranches actually borrowed will be due and payable on the 60th month anniversary of the date on which the Lenders fund the first tranche of term loans.

The term loans may be prepaid before maturity in whole or in part. If the Company prepays any term loan, in whole or in part, during the first 36 months from date on which the Lenders fund the first tranche of term loans, then the Company must pay a prepayment premium equal to the greater of (x) a make-whole amount equal to the interest that would have accrued on the principal amount to be prepaid and (y) a premium equal to 0.03 multiplied by the principal amount to be prepaid. If the Company prepays a term loan, in whole or in part, between the 36th month and 48th month from the date on which the Lenders fund the first tranche of term loans, then the Company must pay a prepayment premium equal to 0.02 multiplied by the principal amount to be prepaid. If the Company prepays a term loan, in whole or in part, between the 48th month and 60th month from the date on which the Lenders fund the first tranche of term loans, then the Company must pay a prepayment premium equal to 0.01 multiplied by the principal amount to be prepaid.

The obligations under the Loan Agreement will be secured by a first priority security interest in and a lien on substantially all of the assets of the Company, subject to certain exceptions.

The Loan Agreement contains certain customary representations and warranties, affirmative and negative covenants and events of default applicable to the Company and its subsidiaries. The Company will be required to comply at all times with a minimum liquidity financial covenant. If an event of default occurs and is continuing, the Collateral Agent may, among other things, accelerate the loans and foreclose on the collateral.

Purchase Agreement

On November 4, 2019, the Company, entered into a purchase agreement (the "Purchase Agreement") with RPI Finance Trust, a Delaware statutory trust ("RPI"). Pursuant to the Purchase Agreement, the Company agreed to sell to RPI 6,666,667 shares (the "Shares") of common stock, par value $0.0001, of the Company (the "Common Stock"), a warrant to purchase up to 2,500,000 shares of Common Stock at an exercise price of $20.00 per share (the "Warrant"), and all of the Company’s rights to receive royalties from Eisai Co., Ltd. ("Eisai") with respect to net sales by Eisai of tazemetostat products in Japan pursuant to the Amended and Restated Collaboration and License Agreement by and between Eisai and the Company, dated as of March 12, 2015 (the "License Agreement") and any successor arrangement for Japan sales (the "Japan Royalty", and collectively, the "Transaction"). In consideration for the sale of the Shares, the Warrant and the Japan Royalty, RPI has agreed to pay the Company $100.0 million upon the closing of the Purchase Agreement. In addition, RPI has agreed, in connection with RPI’s acquisition from Eisai of the right to receive royalties from the Company under the License Agreement, that the Company’s royalty obligation will be reduced upon the achievement of specified annual net sales levels. In addition, under the Purchase Agreement, the Company has the right to sell, and RPI has the obligation to purchase, subject to certain conditions, including a maximum purchase price of $20.00 per share, $50.0 million of shares of Common Stock at the Company’s option for an 18 month period from the date of execution of the Purchase Agreement, provided that the ten-day volume-weighted average trading price of the Common Stock for the ten consecutive trading days immediately preceding the date on which the Company exercises such right must be greater than $8.00 per share (the "Put Option").

The Warrant to be issued will be exercisable for shares of the Company’s common stock at any time prior to the third anniversary of the closing of the Purchase Agreement at an exercise price of $20.00 per share. The Warrant may be settled by net exercise.

The Company expects that the closing of the Purchase Agreement will occur on November 6, 2019, subject to customary conditions.

Under the Purchase Agreement, and in connection with its sale of the Japanese Royalty, the Company has agreed to cooperate with RPI with respect to enforcement of the License Agreement and the Company’s intellectual property rights related to tazemetostat products in Japan. The Company has also agreed to certain negative covenants with respect to the exercise of its rights under the License Agreement, including the Company’s right to amend, assign and terminate the License Agreement. The Purchase Agreement also contains various representations and warranties, covenants, indemnification obligations and other provisions customary for transactions of this nature.

Upon the closing of the Purchase Agreement, Pablo Legorreta will join the Company’s board of directors (the "Board"), as described under Item 5.02 of this Current Report on Form 8-K.

The Shares and Warrant were offered and will be issued and sold in reliance upon the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), set forth under Section 4(a)(2) of the Securities Act relating to sales by an issuer not involving any public offering and in reliance on similar exemptions under applicable state laws. RPI represented that it is an accredited investor and that it is acquiring the Shares and Warrant for investment purposes only and not with a view to any resale, distribution or other disposition of such securities in violation of the United States federal securities laws. Neither this Current Report on Form 8-K, nor the exhibits attached hereto, is an offer to sell or the solicitation of an offer to buy the securities described herein.

The Company expects to use the borrowings under the Loan Agreement and the proceeds from the Transaction for general corporate purposes, including to satisfy the Company’s milestone payment obligations to Eisai Co., Ltd. for milestone achievements associated with the receipt of FDA approval of tazemetostat for the treatment of epithelioid sarcoma in the United States and FDA approval of tazemetostat for the treatment of follicular lymphoma in the United States, respectively. The Company expects that the first tranche under the Loan Agreement and the up-front $100 million payment under the Purchase Agreement, together with its existing cash, cash equivalents and marketable securities, will enable it to fund its operating expenses and capital expenditure requirements into at least 2022.

The foregoing descriptions of the Loan Agreement, Purchase Agreement and the Warrant do not purport to be complete and are qualified in their entirety by reference to the complete text of the Loan Agreement, Purchase Agreement and Warrant, which will be filed as exhibits to the Company’s annual report on Form 10-K for the fiscal year ending December 31, 2019.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth under Item 1.01 of this Current Report on Form 8-K with respect to the Loan Agreement is incorporated by reference to this Item 2.03.

Item 3.02 Unregistered Sale of Equity Securities.
The information set forth under Item 1.01 of this Current Report on Form 8-K with respect to the Purchase Agreement and the sale of the Shares and Warrant thereunder is incorporated by reference to this Item 3.02

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On November 1, 2019, the Board elected Pablo Legorreta to the Board as a Class III Director, with a term expiring at the 2022 annual meeting of stockholders, effective as of the closing of the Purchase Agreement.

Mr. Legorreta is the founder and chief executive officer of RP Management, an affiliate of RPI, and a co-founder of Pharmakon Advisors LP, an affiliate of the Lenders. Mr. Legorreta has over 20 years of experience investing in pharmaceutical royalties and building and managing a leading life sciences investment company. Prior to founding Royalty Pharma in 1996, Mr. Legorreta was an investment banker at Lazard Frères in Paris and New York. Mr. Legorreta serves on the Board of Governors of the New York Academy of Sciences, as well as the Boards of Trustees of Rockefeller University, Brown University, the Hospital for Special Surgery, Pasteur Foundation (the U.S. affiliate of the French Institut Pasteur), Open Medical Institute and Park Avenue Armory. Mr. Legorreta is the founder and chairman of Alianza Médica para la Salud, a non-profit dedicated to enhancing the quality of health care in Latin America by providing doctors and healthcare providers with continued education opportunities. Mr. Legorreta has a degree in industrial engineering from Universidad Iberoamericana in Mexico City.

Mr. Legorreta was elected as a director of the Company under the terms of the Purchase Agreement.

In accordance with the Company’s director compensation program, Mr. Legorreta will receive an annual cash retainer of $40,000 for service on the Board, which is payable quarterly in arrears. Under the Company’s director compensation program, Mr. Legorreta may elect to receive such retainer in shares of common stock of the Company. In addition, under the Company’s director compensation program, upon his election as a director, Mr. Legorreta will be granted an option to purchase the number of shares of the Common Stock that have a Black-Scholes value as of the date of grant equal to $300,000, at an exercise price per share equal to the fair market value on the date of grant. These options vest as to 25% of the shares on the first anniversary of the grant date and as to an additional 2.0833% of the shares at the end of each successive month following the first anniversary of the grant date until the fourth anniversary of the grant date and become exercisable in full upon the occurrence of a change in control of the Company. For a full description of the Company’s director compensation program, see Exhibit 10.2 to the Company’s quarterly report on Form 10-Q for the three months ended June 30, 2019 (File No. 001-35945) filed with the Securities and Exchange Commission (the "SEC") on August 9, 2019.

Also in connection with Mr. Legorreta’s election to the Board, he will enter into the Company’s standard form of indemnification agreement, a copy of which was filed as Exhibit 10.16 to Amendment No. 1 to the Company’s Registration Statement on Form S-1 (File No. 333- 187982) filed with the SEC on April 26, 2013. Pursuant to the terms of this agreement, the Company may be required, among other things, to indemnify Mr. Legorreta for some expenses, including attorneys’ fees, judgments, fines and settlement amounts incurred by him in any action or proceeding arising out of his service as one of the Company’s directors.

On November 4, 2019 CTI BioPharma Corp. (Nasdaq: CTIC) reported its financial results for the third quarter and nine months ended September 30, 2019 (Press release, CTI BioPharma, NOV 4, 2019, View Source [SID1234550230]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We advanced our pacritinib development program in the third quarter, and recently took an important step forward for the company by initiating and enrolling the first patient in the PACIFICA trial, our pivotal Phase 3 trial of pacritinib in myelofibrosis patients with severe thrombocytopenia," said Adam R. Craig, M.D., Ph.D., President and Chief Executive Officer of CTI BioPharma. "An estimated one-third of patients with myelofibrosis are severely thrombocytopenic – a population with limited therapeutic options and poor survival, thereby making this disease setting a very important area of unmet medical need. In the near-term, we look forward to presenting results from the PAC203 Phase 2 trial at a scientific conference before the end of the year."

Third Quarter Financial Results
Operating loss was $9.7 million and $31.2 million for the three and nine months ended September 30, 2019, respectively, compared to operating loss of $14.8 million and $33.1 million for the respective periods in 2018. The decrease in operating loss during the three-month period ended September 30, 2019 as compared to the comparable period in 2018 resulted primarily from a decrease in operating expenses as well as the increase in license and contract revenues as discussed below. The decrease in operating loss for the nine months ended September 30, 2019 as compared to the same period in 2018 resulted primarily from a decrease in operating expenses, offset by the decrease in license and contract revenue between periods. As of September 30, 2019, cash, cash equivalents and short-term investments totaled $46.7 million, compared to $67.0 million as of December 31, 2018. CTI BioPharma expects current cash, cash equivalents and short-term investments will enable it to fund its operations into the third quarter of 2020.

License and contract revenues for the three and nine months ended September 30, 2019 were $2.3 million and $3.3 million, respectively, compared to $0.7 million and $12.2 million for the respective periods in 2018. The increase in license and contract revenues for the three months ended September 30, 2019 compared to the comparable period in 2018 is primarily due to revenue recognized in connection with the asset purchase agreement with our partner Les Laboratoires Servier and Institut de Recherches Internationales Servier. The decrease in license and contract revenues for the nine months ended September 30, 2019 compared to the same period in 2018 is primarily due to the recognition of $10.0 million in milestone revenue in 2018 from Teva Pharmaceutical Industries Ltd. related to the achievement of a milestone for FDA approval of TRISENOX (arsenic trioxide) for first-line treatment of acute promyelocytic leukemia. There were no such revenues for the comparable period in 2019.

Net loss attributable to common stockholders for the three months ended September 30, 2019 was $10.0 million, or $(0.17) for basic and diluted loss per share, compared to net loss attributable to common stockholders of $14.8 million, or $(0.26) for basic and diluted loss per share, for the same period in 2018. Net loss attributable to common stockholders for the nine months ended September 30, 2019 was $31.8 million, or $(0.55) for basic and diluted loss per share, compared to net loss attributable to common stockholders of $30.2 million, or $(0.55) for basic and diluted loss per share, for the same period in 2018.

On November 4, 2019 Unum Therapeutics Inc. (NASDAQ: UMRX), a clinical-stage biopharmaceutical company focused on developing curative cell therapies for cancer, reported a strategic shift to focus development on its ACTR and BOXR product candidates in solid tumors and supportive platform capabilities (Press release, Unum Therapeutics, NOV 4, 2019, View Source [SID1234550246]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We are uniquely positioned to address the challenge of treating solid tumor cancers, and now is the time to focus our efforts, having recently validated our ACTR technology in the hematologic setting and with preclinical data emerging from BOXR1030, the first product candidate from our BOXR platform. Our ACTR technology enables selective T cell targeting for on-tumor attack, while our BOXR platform makes it possible to overcome solid tumor immunosuppression, the fundamental challenge that has limited the effectiveness of cell therapies," said Chuck Wilson Ph.D., President and Chief Executive Officer of Unum. "Our priorities in solid tumors include completing the ongoing Phase 1 trial of ACTR707 in HER2+ cancers; advancing BOXR1030 towards the clinic with an anticipated IND filing in 2020; and expanding our BOXR platform to accelerate discovery of new product candidates across a broad range of immune cell therapies, including both autologous and allogeneic approaches."

ACTR707 was engineered for properties that optimize its function in solid tumors including increased proliferation, cytokine secretion, and persistence. With Unum’s focus on developing therapies for solid tumors, the company will de-prioritize investment in its hematologic programs. Testing through the first four dose levels in the ongoing ATTCK-20-03 Phase 1 trial in non-Hodgkin lymphoma has now established proof-of-concept for ACTR707. Given favorable tolerability to date at relatively low doses, Unum is announcing today plans to continue limited dose escalation to inform potential future development of the program in 2020.

Separately, Unum and its partner, Seattle Genetics, Inc., have suspended further dose-escalation of the ATTCK-17-01 Phase 1 trial of ACTR087 with SEA-BCMA in multiple myeloma pending a further review of this program. No dose-limiting toxicities (DLTs) following ACTR087 administration were reported and no severe adverse events of cytokine release syndrome (CRS) or neurologic events have been observed to date.

Solid Tumor Program Highlights

Phase 1 ATTCK-34-01 Trial: ACTR707 combined with trastuzumab to treat advanced HER2+ solid tumor cancers. Five clinical sites are now activated to support the Phase 1 trial that is currently enrolling patients. Unum expects to report preliminary safety data from patients treated in the first dose cohort of the trial by the end of this year and to report safety and clinical response data from multiple dose cohorts in 2020.

BOXR1030: Incorporating the GOT2 transgene and targeting GPC3+ solid tumor cancers. Unum’s first product candidate selected from its Bolt-On Chimeric Receptor (BOXR) platform, BOXR1030, continues to progress towards first-in-human clinical trials. BOXR1030 expresses a glypican-3 (GPC3) targeted chimeric antigen receptor (CAR) and leverages the "bolt-on" transgene glutamic-oxaloacetic transaminase 2 (GOT2) to improve T cell function in the solid tumor microenvironment by enhancing T cell metabolism. Preclinical studies have characterized the mechanism of action of BOXR1030’s bolt-on transgene with further details to be presented at the upcoming Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) conference during November 6-10, 2019. Based on recent progress, Unum now plans to file an investigational new drug (IND) application for BOXR1030 in late 2020, enabling subsequent clinical testing in GPC3+ cancers.

BOXR Platform Expansion: Unum’s BOXR platform was established over two years ago with the aim of discovering novel transgenes that can be co-expressed with chimeric-targeting receptors to improve the function of T cells in the solid tumor microenvironment. As part of its strategic shift to target solid tumors, Unum will be scaling up its BOXR platform capabilities with the objectives of: (1) expanding the scope of biological mechanisms and transgenes in its proprietary BOXR library, (2) enabling BOXR bolt-on applications for a broad range of immune cell therapies, including both autologous and allogeneic approaches, and (3) advancing new BOXR product candidates into the clinic.
Hematologic Program Highlights

Phase 1 ATTCK-20-03 trial: ACTR707 combined with rituximab for relapsed/refractory non-Hodgkin lymphoma. As a preliminary update provided today for the six patients treated in Cohort 4 (80M ACTR707+ T cells), complete response was achieved at the first response assessment in two of six patients as of the October 2019 analysis, yielding a complete response rate of 40% (eight of 20 patients) in Cohorts 1 through 4. Of the eight complete responders, four remained in complete response at six months of follow-up, two remain in complete response but have not yet reached the six-month timepoint for evaluation, and two progressed before the six-month timepoint. In Cohorts 1 through 4, ACTR707 was well-tolerated in combination with rituximab. No DLTs, no adverse events of CRS, and no severe neurological adverse events including neurotoxicity have been reported as of the October 2019 cutoff. Further results will be presented at the American Society for Hematology (ASH) (Free ASH Whitepaper) Annual Meeting during December 7-10, 2019. Unum plans to enroll up to two additional cohorts (three to four patients per cohort) in the trial, escalating the maximum dose up to 180M ACTR707+ T cells. With patient screening and planned dosing underway, Unum plans to report preliminary results from this dose escalation during 2020. The ability to differentiate on both efficacy and safety relative to currently available therapies and those in development from these additional cohorts will drive a decision during 2020 whether to advance the program into an expanded dose cohort and potential pivotal studies.

Phase 1 ATTCK-17-01 trial: ACTR087 combined with SEA-BCMA for relapsed/refractory multiple myeloma. Two additional cohorts of patients have been treated in the Phase 1 trial in 2019, escalating doses of the SEA-BCMA antibody to 2.0 mg/kg and of the ACTR087+ T cells to 50M. Unum and Seattle Genetics have suspended further dose-escalation of the trial and are reviewing the next steps with this program.
Investor Call and Webcast Information

Unum will host a live conference call and webcast today, November 4, 2019, at 4:30 p.m. ET, to discuss these company updates. To access the call, please dial 866-300-3411 (domestic) or 636-812-6658 (international) and refer to conference ID number 2177408. A webcast will be available at unumrx.com at least 10 minutes before the event begins. The archived webcast will be available at the same location approximately two hours after the event and will be archived for 90 days.

On November 4, 2019 Epizyme, Inc. (Nasdaq: EPZM), a late-stage biopharmaceutical company developing novel epigenetic therapies, reported funding agreements with Royalty Pharma and its affiliate Pharmakon Advisors that, in aggregate, could bring in up to $270 million in capital, significantly strengthening Epizyme’s financial position and extending its operating runway into at least 2022 (Press release, Epizyme, NOV 4, 2019, View Source [SID1234550263]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"These funding transactions support our strategy of becoming a fully integrated, commercial biopharmaceutical company, and provide us significant optionality for the future," said Robert Bazemore, president and chief executive officer of Epizyme. "We are well capitalized to fully fund the anticipated launches of tazemetostat for epithelioid sarcoma and follicular lymphoma next year, and further invest in both the continued development of tazemetostat and our epigenetic pipeline. Royalty Pharma has an outstanding reputation for investing in promising, late-stage companies, and we are thrilled to have their support as we head into the next phase of our evolution."

As part of the agreements, Royalty Pharma will make an upfront payment of $100 million for shares of Epizyme common stock based on a price of $15 per share, representing a 27% premium to the prior trading day’s closing price. Epizyme also has an 18-month option to sell an additional $50 million of its common stock to Royalty Pharma at then prevailing prices, not to exceed $20 per share, and Royalty Pharma has a three-year option to purchase an additional 2.5 million shares of Epizyme common stock at $20 per share.

Epizyme and Royalty Pharma have also agreed to reduce the existing royalty rates owed by Epizyme to Royalty Pharma on worldwide sales of tazemetostat outside Japan at specified annual net sales levels. This reduction follows Royalty Pharma’s acquisition of certain future royalty streams on sales of tazemetostat in all regions except for Japan, which Epizyme previously owed to Eisai as part of their April 2015 amended and restated agreement. In addition, Epizyme has assigned to Royalty Pharma the future royalty streams on tazemetostat sales in Japan previously owed to Epizyme by Eisai.

"We are very pleased to partner with Epizyme, particularly given the tremendous progress in advancing tazemetostat over the course of 2019," stated Pablo Legorreta, founder and chief executive of Royalty Pharma. "With impressive data in treating both solid tumors and hematologic malignancies, we share the company’s excitement for tazemetostat’s broad therapeutic potential and are committed to supporting tazemetostat’s further development and anticipated launches to fully maximize its commercial opportunity. We look forward to working closely with this talented team as they transition into a commercial-stage organization."

As part of the transactions, Mr. Legorreta will be appointed to Epizyme’s Board of Directors.

Under a separate agreement, Epizyme has established a $70 million loan facility with Pharmakon Advisors, an affiliate of Royalty Pharma, which will fund the regulatory milestones owed to Eisai for the NDA submissions and U.S. approvals for tazemetostat for epithelioid sarcoma and follicular lymphoma. The facility may be drawn down in up to three tranches in conjunction with achievement of the milestones and is expandable by up to $300 million following approval of tazemetostat in follicular lymphoma, subject to mutual agreement.

For a further description of terms of the transaction agreements, please refer to Epizyme’s Form 8-K filed today.

Wilmer Cutler Pickering Hale and Dorr LLP acted as legal advisor to Epizyme; Goodwin Procter LLP, Dechert LLP and Maiwald Patentanwalts- und Rechtsanwalts GmbH acted as legal advisors to Royalty Pharma; and, Akin Gump Strauss Hauer & Feld LLP acted as legal advisor to Pharmakon Advisors.