On March 10, 2025 Fennec Pharmaceuticals Inc. (NASDAQ:FENC; TSX: FRX), a specialty pharmaceutical company, reported its financial results for the fiscal year ended December 31, 2024 and provided a business update (Press release, Fennec Pharmaceuticals, MAR 10, 2025, View Source [SID1234651038]).

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"2024 marked the beginning of a foundational transformation for Fennec, setting the stage for the PEDMARK strategy that we are utilizing throughout 2025 to realize our next phase of growth. With key management and commercial hires in Q3 and Q4, we strengthened our leadership team and with this enhanced expertise, we are now well-positioned to drive execution and excellence in the field. We are seeing encouraging momentum in early 2025, particularly with adoption by academic institutions and new patient segments, reinforcing the value and need for PEDMARK," said Jeff Hackman, chief executive officer of Fennec Pharmaceuticals. "Global access to PEDMARK has also expanded meaningfully, with recent PEDMARQSI commercial launches in the United Kingdom and Germany in 2025. With the right foundational strategies now in place, we are confident that our strong and focused execution will translate into significant shareholder value in 2025 and beyond."

Business Highlights:

● U.S. Clinical Compendia Update: All medical compendia have incorporated Fennec’s clinical updates, and AHFS, the largest online platform for pharmacists, has updated its content to reflect and differentiate PEDMARK in accordance with its labeling. We also continue to advance our efforts to have PEDMARK added to the NCCN Drug and Biologics Compendium, a key step in further expanding access and reimbursement pathways.

● PEDMARQSIÒ Commercial Launch in Europe: In December 2024, Norgine received positive guidance from National Institute for Health and Care Excellence (NICE) recommending PEDMARQSI for the prevention of cisplatin-induced hearing loss in patients (aged 1 month to 17 years) with localized, non-metastatic, solid tumors and PEDMARQSI is currently available in the U.K. In February 2025, Norgine announced that it has commercially launched PEDMARQSI in Germany. Both milestones mark an important step in achieving Fennec’s mission of expanding access to PEDMARQSI to cancer patients across the globe at risk of hearing loss.

● Ex-U.S. Opportunities for PEDMARKÒ: In Japan, the investigator-initiated clinical trial (STS-J01) in Japan evaluating PEDMARKÒ fully enrolled in Q4 2024 and the results of the trial are expected in the second half of 2025 with the potential evaluation for registration of PEDMARK in Japan thereafter. Further, Fennec has partnered with Inpharmus, formerly named TRPharm İlaç Sanayi Ticaret A.Ş. and TRPharm FZ-LLC, for the distribution of PEDMARK in Turkey and Gulf Cooperation Council Countries.

●Early Repayment of $13 Million of the Company’s Approximately $32 Million Outstanding Convertible Debt Facility: In December 2024, Fennec announced the early partial repayment of a significant portion of its debt to Petrichor in a financial and strategic action that optimizes the Company’s balance sheet and overall capital structure, while effectively saving approximately $1.5 million in future annual interest payments and eliminating potential dilutive shares.

Financial Results for the Fourth Quarter and Full Fiscal Year Ended December 31, 2024

● Net Product Sales – For the fourth quarter of 2024, the Company recorded net product sales of $7.9 million compared to $7.0 million in the third quarter of 2024, representing an increase of approximately 13%. For the full fiscal year (FY) 2024, the Company recorded $29.6 million compared to $21.3 million in 2023, representing an increase of approximately 40%. The increase in sales in both the quarter and year reflects strong growth in accounts and increased penetration in the AYA market opportunity.

● Cash Position – Cash and cash equivalents were $26.6 million as of December 31, 2024. Of note, for the fourth quarter of 2024, our cash flow from operations decreased by $0.6 million. For the FY 2024, there was a $13.4 million increase in cash and cash equivalents between December 31, 2023 and December 31, 2024. The increase in cash was primarily due to the $43 million in upfront cash from the Norgine transaction and cash collected from product sales offset by operating expenses and the $13 million convertible debt paydown in December 2024.
● Selling and Marketing Expenses – The Company recorded $3.9 million in selling and marketing expenses in the fourth quarter of 2024 compared to $4.6 million in the third quarter of 2024. For the FY 2024, the Company recorded $18.4 million in selling and marketing compared to $12.1 million in fiscal year 2023. The increase is largely related to increased payroll and additional marketing expenses in the comparable periods as we focused on expanding our outreach to community oncology centers and the adolescent and young adult (AYA) population.

● General and Administrative (G&A) Expenses – The Company recorded $4.1 million in G&A expenses fourth quarter of 2024 compared to $7.0 million in the third quarter of 2024. For the FY 2024, the Company recorded $23.1 million in G&A expenses compared to $20.6 million in fiscal year 2023. For the fourth quarter of 2024, G&A expenses decreased due largely to lower cash based stock compensation and a one-time severance payment related to the previous CEO in the third quarter. For the full year G&A expenses were higher both due to European pre-commercialization related expenses, expenses associated with the Norgine transaction and intellectual property expenses related to ongoing litigation.

Fourth Quarter and Full-Year 2024 Conference Call Information

Date: Monday, March 10, 2025

Time: 8:30 a.m. ETWebcast Link: View Source

Participant Link: https://register.vevent.com/register/BIeb244773eed644bd83882935e4272e91

To access the live webcast link, log onto www.fennecpharma.com and proceed to the News & Events/Event Calendar page under the Investors & Media heading. Please connect to the company’s website at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to listen to the webcast. A webcast replay of the conference call will also be archived on www.fennecpharma.com for thirty days.

Financial Update

The selected financial data presented below is derived from our unaudited condensed consolidated financial statements, which were prepared in accordance with U.S. generally accepted accounting principles. The complete audited condensed consolidated financial statements for the period ended December 31, 2024 and management’s discussion and analysis of financial condition and results of operations will be available via www.sec.gov and www.sedar.com. All values are presented in thousands unless otherwise noted.

Unaudited Consolidated

Statements of Operations:

(U.S. Dollars in thousands except per share amounts

Three Months Ended

Twelve Months Ended

December 31,

December 31,

December 31,

December 31,

2024

2023

2024

2023

Revenue

Product sales, net

$

7,925

$

9,735

$

29,580

$

21,252

Licensing revenue

—

—

17,958

—

Total revenue

7,925

9,735

47,538

21,252

Operating expenses:

Cost of product sales

669

685

3,184

1,259

Research and development

50

32

307

56

Selling and marketing

3,944

3,868

18,426

12,123

General and administrative

4,196

6,968

23,053

20,585

Total operating expenses

8,859

11,553

44,970

34,023

Loss from operations

(934)

(1,818)

2,568

(12,771)

Other (expense)/income

Realized foreign exchange (loss)/gain

(27)

2

(82)

5

Amortization expense

(25)

(70)

(89)

(287)

Unrealized loss on securities

(66)

4

(80)

(39)

Interest income

399

115

1,682

441

Interest expense

(966)

(915)

(4,069)

(3,394)

Total other (expense)/income

(685)

(864)

(2,638)

(3,274)

Net (loss) / income

$

(1,619)

$

(2,682)

$

(70)

$

(16,045)

Basic net loss per common share

$

(0.06)

$

(0.10)

$

(0.00)

$

(0.60)

Diluted net loss per common share

$

(0.06)

$

(0.10)

$

(0.00)

$

(0.60)

Weighted-average number of common shares outstanding basic

27,460

26,833

27,294

26,574

Weighted-average number of common shares outstanding diluted

27,460

26,833

27,294

26,574

December 31,

December 31,

2024

2023

Assets

Current assets

Cash and cash equivalents

$

26,634

$

13,269

Accounts receivable, net

12,884

8,814

Prepaid expenses

3,080

583

Inventory

1,060

2,156

Other current assets

364

21

Total current assets

44,022

24,843

Non-current assets

Other non-current assets, net of amortization

924

2,021

Total non-current assets

924

2,021

Total assets

$

44,946

$

26,864

Liabilities and shareholders’ (deficit) equity

Current liabilities:

Accounts payable

$

2,875

$

3,778

Accrued liabilities

3,428

3,754

Operating lease liability – current

248

21

Contract liability – current

2

—

Total current liabilities

6,553

7,553

Long term liabilities

Term loan

18,206

30,000

PIK interest

1,271

1,219

Debt discount

(139)

(288)

Contract liability – long-term

24,561

2

Total long term liabilities

43,899

30,933

Total liabilities

50,452

38,486

Commitments and Contingencies

Shareholders’(deficit) equity:

Common stock, no par value; unlimited shares authorized; 27,292 shares issued and outstanding (2023 -26,361)

145,608

144,307

Additional paid-in capital

66,958

62,073

Accumulated deficit

(219,315)

(219,245)

Accumulated other comprehensive income

1,243

1,243

Total shareholders’ (deficit) equity

(5,506)

(11,622)

Total liabilities and shareholders’ (deficit) equity

$

44,946

$

26,864

Working capital

Fiscal Year Ended

Selected Asset and Liability Data:

December 31, 2024

December 31, 2023

(U.S. Dollars in thousands)

Cash and equivalents

$

26,634

$

13,269

Other current assets

17,388

11,574

Current liabilities

6,553

7,553

Working capital

$

37,469

$

17,290

Selected Equity:

Common stock and additional paid in capital

212,566

206,380

Accumulated deficit

(219,315)

(219,245)

Shareholders’ equity

(5,506)

(11,622)

About Cisplatin-Induced Ototoxicity

Cisplatin and other platinum compounds are essential chemotherapeutic agents for the treatment of many malignancies. Unfortunately, platinum-based therapies can cause ototoxicity, or hearing loss, which is permanent, irreversible, and particularly harmful to the survivors of pediatric cancer.i

The incidence of ototoxicity depends upon the dose and duration of chemotherapy, and many of these children require lifelong hearing aids or cochlear implants, which can be helpful for some, but do not reverse the hearing loss and can be costly over time.ii Infants and young children that are affected by ototoxicity at critical stages of development lack speech and language development and literacy, and older children and adolescents often lack social-emotional development and educational achievement.iii

PEDMARK (sodium thiosulfate injection)

PEDMARK is the first and only U.S. Food and Drug Administration (FDA) approved therapy indicated to reduce the risk of ototoxicity associated with cisplatin treatment in pediatric patients with localized, non-metastatic, solid tumors. It is a unique formulation of sodium thiosulfate in single-dose, ready-to-use vials for intravenous use in pediatric patients. PEDMARK is also the first and only therapeutic agent with proven efficacy and safety data with an established dosing regimen, across two open-label, randomized Phase 3 clinical studies, the Children’s Oncology Group (COG) Protocol ACCL0431 and SIOPEL 6.

As a reminder, PEDMARK is indicated to reduce the risk of ototoxicity associated with cisplatin in pediatric patients 1 month of age and older with localized, non-metastatic solid tumors. PEDMARK is recommended for the AYA population by the National Comprehensive Cancer Network, or NCCN, with a 2A endorsement.

In the U.S. and Europe, it is estimated that, annually, more than 10,000 children may receive platinum-based chemotherapy. The incidence of ototoxicity depends upon the dose and duration of chemotherapy, and many of these children require lifelong hearing aids. There is currently no established preventive agent for this hearing loss and only expensive, technically difficult, and sub-optimal cochlear (inner ear) implants have been shown to provide some benefit. Infants and young children that suffer ototoxicity at critical stages of development lack speech language development and literacy, and older children and adolescents lack social-emotional development and educational achievement.

PEDMARK has been studied by co-operative groups in two Phase 3 clinical studies of survival and reduction of ototoxicity, COG ACCL0431 and SIOPEL 6. Both studies have been completed. The COG ACCL0431 protocol enrolled childhood cancers typically treated with intensive cisplatin therapy for localized and disseminated disease, including newly diagnosed hepatoblastoma, germ cell tumor, osteosarcoma, neuroblastoma, medulloblastoma, and other solid tumors. SIOPEL 6 enrolled only hepatoblastoma patients with localized tumors.

Indications and Usage

PEDMARK (sodium thiosulfate injection) is indicated to reduce the risk of ototoxicity associated with cisplatin in pediatric patients 1 month of age and older with localized, non-metastatic solid tumors.

Limitations of Use

The safety and efficacy of PEDMARK have not been established when administered following cisplatin infusions longer than 6 hours. PEDMARK may not reduce the risk of ototoxicity when administered following longer cisplatin infusions, because irreversible ototoxicity may have already occurred.

Important Safety Information

PEDMARK is contraindicated in patients with history of a severe hypersensitivity to sodium thiosulfate or any of its components.

Hypersensitivity reactions occurred in 8% to 13% of patients in clinical trials. Monitor patients for hypersensitivity reactions. Immediately discontinue PEDMARK and institute appropriate care if a hypersensitivity reaction occurs. Administer antihistamines or glucocorticoids (if appropriate) before each subsequent administration of PEDMARK. PEDMARK may contain sodium sulfite; patients with sulfite sensitivity may have hypersensitivity reactions, including anaphylactic symptoms and life-threatening or severe asthma episodes. Sulfite sensitivity is seen more frequently in people with asthma.

PEDMARK is not indicated for use in pediatric patients less than 1 month of age due to the increased risk of hypernatremia or in pediatric patients with metastatic cancers.

Hypernatremia occurred in 12% to 26% of patients in clinical trials, including a single Grade 3 case. Hypokalemia occurred in 15% to 27% of patients in clinical trials, with Grade 3 or 4 occurring in 9% to 27% of patients. Monitor serum sodium and potassium levels at baseline and as clinically indicated. Withhold PEDMARK in patients with baseline serum sodium greater than 145 mmol/L.

Monitor for signs and symptoms of hypernatremia and hypokalemia more closely if the glomerular filtration rate (GFR) falls below 60 mL/min/1.73m2.

Administer antiemetics prior to each PEDMARK administration. Provide additional antiemetics and supportive care as appropriate.

The most common adverse reactions (≥25% with difference between arms of >5% compared to cisplatin alone) in SIOPEL 6 were vomiting, nausea, decreased hemoglobin, and hypernatremia. The most common adverse reaction (≥25% with difference between arms of >5% compared to cisplatin alone) in COG ACCL0431 was hypokalemia.

Please see full Prescribing Information for PEDMARK at: www.PEDMARK.com.

On March 10, 2025 Agilent Technologies Inc. (NYSE: A) reported its PD-L1 IHC 28-8 pharmDx kit has received two new companion diagnostic indications approvals under EU IVDR1, expanding the eligibility of treatment to early-stage non-small cell lung cancer (NSCLC) and previously untreated advanced melanoma patients (Press release, Agilent Technologies, MAR 10, 2025, View Source [SID1234651055]). These two new indications bring the total indications launched in Europe for PD-L1 IHC 28-8 pharmDx to nine. PD-L1 IHC 28-8 pharmDx is approved for exclusive use with the Agilent Autostainer Link 48 advanced staining solution.

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Lung cancer and malignant melanoma are major healthcare concerns worldwide, with lung cancer accounting for over two million new cases in 2020 and an estimated 1.77 million deaths each year, and malignant melanoma accounting for over 324,000 new cases in 2020 and over 57,000 deaths each year2. PD-L1 is a critical biomarker for potential response to anti-PD-1 therapies, which are revolutionizing the treatment of cancer. Pathology labs play an important role in informing treatment decisions.

When used in conjunction with the PD-L1 IHC 28-8 pharmDx as a companion test, in the European Union: (a) resectable NSCLC patients with PD-L1 expression ≥1% and at high risk of recurrence may be eligible for treatment with Bristol Myers Squibb’s OPDIVO (nivolumab) in combination with platinum based chemotherapy; and (b) patients 12 years of age and older with tumor cell PD-L1 expression < 1% that have previously untreated advanced (metastatic or unresectable) melanoma may be eligible for treatment with Bristol Myers Squibb’s Opdualag (nivolumab and relatlimab).

PD-L1 IHC 28-8 pharmDx is the only clinically validated test for identifying patients for these treatments; these two new indications will aid pathologists, in conjunction with oncologists, in selecting appropriate treatment options, offering hope for patients diagnosed with these cancers. IVDR compliance certification further enhances the confidence of patients, consumers, and healthcare professionals in the EU by demonstrating that these medical devices can be safely relied upon as part of the diagnostic workflow.

Simon May, senior vice president of Agilent’s Life Sciences and Diagnostics Markets Group, remarked: "The two added indications of PD-L1 IHC 28-8 pharmDx will give physicians in Europe critical information to inform treatment decisions for patients with these common and potentially deadly cancers. This endorsement underscores Agilent’s leadership in the development of companion diagnostics for groundbreaking therapies containing anti-PD-1 antibodies."

An innovative industry leader with more than 50 years of experience, Agilent launched the first FDA-approved companion diagnostic and continues to deliver world-class CDx products in close collaboration with pharma partners.

OPDIVO is a registered trademark of Bristol-Myers Squibb Company; Opdualag is a trademark of Bristol-Myers Squibb Company.

In Vitro Diagnostic Medical Devices Regulation (europa.eu)
Sung. H., Ferlay. J., et al. Global Cancer Statistics 2020: GLOBOCAN Estimates of Incidence and Mortality Worldwide for 36 Cancers in 185 Countries, CA. Cancer J. Clin. 2021, 71, 209–249

On March 9, 2025, Checkpoint Therapeutics, Inc., a Delaware corporation ("Checkpoint") and majority-controlled subsidiary of Fortress Biotech, Inc. ("Fortress"), entered into an Agreement and Plan of Merger (the "Merger Agreement") with Sun Pharmaceutical Industries, Inc., a Delaware corporation ("Sun Pharma" or "Parent"), and Snoopy Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent ("Merger Sub") (Filing, 8-K, Fortress Biotech, MAR 9, 2025, View Source [SID1234651039]). The Merger Agreement provides that, on the terms and subject to the conditions set forth in the Merger Agreement, Parent, Merger Sub and Checkpoint will effect a merger of Merger Sub with and into Checkpoint (the "Merger"), with Checkpoint continuing as the surviving corporation of the Merger and a wholly owned subsidiary of Parent.

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Pursuant to the Merger Agreement, at the effective time of the Merger (the "Effective Time"), each share of common stock and each share of Class A common stock of Checkpoint (collectively, the "Shares") (including each unvested Checkpoint restricted share) outstanding immediately prior to the Effective Time will be canceled and cease to exist and be converted into the right to receive (i) $4.10 in cash, without interest (the "Common Cash Amount"), and (ii) one non-tradable contingent value right (a "CVR"), which will represent the right to receive a contingent cash payment of up to $0.70 upon the achievement of specified milestones, subject to and in accordance with the terms and conditions set forth in a Contingent Value Rights Agreement, substantially in the form attached as Exhibit B to the Merger Agreement (the "CVR Agreement"), as further described below (the foregoing clauses (i) and (ii), the "Merger Consideration"), in each case subject to applicable withholding taxes.

Consummation of the Merger is subject to customary closing conditions, including, but not limited to: (i) the adoption of the Merger Agreement and approval of the Merger by (a) the affirmative vote of the holders of at least a majority of the outstanding Shares beneficially owned by Checkpoint stockholders other than (1) Fortress and its controlled affiliates (other than Checkpoint), (2) the members of the Checkpoint board of directors (the "Checkpoint Board") (and their controlled affiliates, if any) and (3) any person that Checkpoint has determined to be an "officer" of Checkpoint within the meaning of Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") (the "Unaffiliated Checkpoint Stockholders"), and (b) the affirmative vote of the holders of a majority in voting power of outstanding the Shares; (ii) expiration or early termination of any waiting periods applicable to the consummation of the Merger under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, without the imposition of any burdensome condition; (iii) absence of any law or order prohibiting or making illegal the consummation of the Merger; and (iv) no Checkpoint material adverse effect having occurred that is continuing. The consummation of the Merger is also conditioned upon each of the Support Agreement, the Transition Services Agreement, the Royalty Agreement, and the CVR Agreement (in each case, as defined below) being in full force and effect.

The Merger Agreement contains customary representations, warranties and covenants made by each of Parent, Checkpoint and Merger Sub, including, among others customary covenants regarding the operation of the business of Checkpoint prior to the Effective Time, and "no-shop" restrictions regarding certain alternative acquisition proposals or discussions with third parties.

The Merger Agreement includes customary termination rights for the parties, including that, subject to certain limitations, Checkpoint or Parent may terminate the Merger Agreement prior to the Effective Time if: (i) a governmental body issues or enacts a final and non-appealable order, injunction or other legal requirement prohibiting or making illegal the consummation of the Merger, (ii) if the Effective Time has not occurred on or prior to 11:59 p.m. Eastern Time on September 5, 2025 or (iii) the stockholders of Checkpoint fail to adopt the Merger Agreement by the requisite majorities at a meeting of Checkpoint’s stockholders at which a vote on the Merger is conducted.

Checkpoint may terminate the Merger Agreement in certain additional limited circumstances, including to allow Checkpoint to enter into an agreement providing for an alternative acquisition transaction that constitutes a Superior Proposal (as defined in the Merger Agreement). Parent may terminate the Merger Agreement in certain additional limited circumstances, including if the Checkpoint Board, or any committee thereof, including the Special Committee of the Checkpoint Board, withdraws, withholds, amends or qualifies or modifies, in each case, in a manner adverse to Parent or Merger Sub, its recommendation that the stockholders of Checkpoint vote to adopt the Merger Agreement and approve the Merger.

Upon termination of the Merger Agreement under certain specified circumstances, Checkpoint will be required to pay Parent a termination fee (the "Checkpoint Termination Fee") of $12,500,000. Specifically, the Checkpoint Termination Fee is payable if (i) the Merger Agreement is terminated in certain circumstances; (ii) prior to such termination (but after the date of the Merger Agreement) a bona fide proposal for an alternative acquisition transaction has been publicly disclosed or otherwise made to the Checkpoint Board and not publicly withdrawn (if made publicly); and (iii) within one year of such termination, Checkpoint subsequently consummates an alternative acquisition transaction or enters into a definitive agreement providing for an alternative acquisition transaction and such transaction is ultimately consummated. The Checkpoint Termination Fee will also be payable if the Merger Agreement is terminated: (a) by Parent, if Checkpoint Board, or any committee thereof, including the Special Committee of the Checkpoint Board, withdraws, withholds, amends or qualifies or modifies, in each case, in a manner adverse to Parent or Merger Sub, its recommendation that the stockholders of Checkpoint vote to adopt the Merger Agreement and approve the Merger; or (b) by Checkpoint in order to enter into an agreement providing for an alternative acquisition transaction that constitutes a Superior Proposal.

The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is attached hereto as Exhibit 2.1 and incorporated herein by reference.

CVR Agreement

Pursuant to the Merger Agreement, as of or prior to the Effective Time, Parent and a rights agent (the "Rights Agent") will enter into the CVR Agreement governing the terms of the CVRs issued in connection with the Merger. The Rights Agent will maintain an up-to-date register of the holders of CVRs (the "Holders"). Holders shall not be permitted to transfer the CVRs (subject to certain limited exceptions as set forth in the CVR Agreement).

Each CVR represents the right to receive one of the following contingent cash payments, without interest, subject to any applicable withholding taxes (such applicable payment, the "Milestone Payment"), conditioned upon the achievement of the corresponding milestone condition within the following specified time periods:

(i) $0.70, if the Milestone (as defined below) is first achieved on or prior to the date that is 12 months prior to Milestone Deadline Date (as defined below) and the applicable regulatory approval provides for a dosing schedule of once every three weeks,
(ii) $0.45, if the Milestone is first achieved on or prior to the date that is 12 months prior to the Milestone Deadline Date and the applicable regulatory approval provides for a dosing schedule that is more frequent than once every three weeks,
(iii) $0.45, if the Milestone is first achieved after the date that is 12 months prior to the Milestone Deadline Date but on or prior to the Milestone Deadline Date, and the applicable regulatory approval provides for a dosing schedule of once every three weeks, or
(iv) $0.20, if the Milestone is first achieved after the date that is 12 months prior to the Milestone Deadline Date but on or prior to the Milestone Deadline Date, and the applicable regulatory approval provides for a dosing schedule that is more frequent than once every three weeks.
As used in the CVR Agreement, (a) the "Milestone Deadline Date" means the date that is 36 months after the date on which a marketing authorization application or equivalent for cosibelimab receives a positive validation outcome by the European Medicines Agency (the "EMA") and (b) the "Milestone" means the receipt of regulatory approval of (i) cosibelimab in the European Union pursuant to the centralized approval procedure or (ii) any of Germany, France, Italy, Spain or the United Kingdom.

Parent (directly or through its affiliates) is obligated to use, and to obligate its licensees to use, certain specified commercially reasonable efforts to (i) file a marketing authorization application for cosibelimab with the EMA within 12 months of the Closing Date or, to the extent any feedback or communications from, or expectations or requirements of, the EMA (including additional trial requirements) make it impracticable or inadvisable to file such marketing authorization application within such time period, as promptly thereafter as practicable, and (ii) achieve the Primary Milestone (as defined in the CVR Agreement) in its then-maximum value as promptly as practicable (including timely filing any appeals and curing any deficiencies identified in a relevant marketing authorization application by the relevant regulatory

authority). Parent’s obligations to use such commercially reasonable efforts terminates on the earlier of (a) the Milestone Deadline Date and (b) the achievement of the Milestone. There can be no assurance that the Milestone will be achieved on or before the Milestone Deadline Date, or that any Milestone Payments will be made.

The foregoing description of the form of CVR Agreement does not purport to be complete and is qualified in its entirety by reference to the form of CVR Agreement, a copy of the form of which is included as Exhibit B to the Merger Agreement filed as Exhibit 2.1 to this report and incorporated by reference herein.

Support Agreement

Concurrently with the execution of the Merger Agreement, Checkpoint entered into a Support Agreement (the "Support Agreement") with Parent and Fortress. Under the terms of the Support Agreement, Fortress has agreed to, among other things, during the term of the Support Agreement, (i) vote its Shares in favor of the adoption of the Merger Agreement and the approval of the Merger and the other transactions contemplated by the Merger Agreement, and against any acquisition proposal or any action, proposal, agreement, transaction or arrangement that is intended, or would reasonably be expected, to result in a material breach of a covenant, representation or warranty or any obligation of Checkpoint under the Merger Agreement or any of the conditions to Checkpoint’s obligations under the Merger Agreement not being fulfilled or satisfied, (ii) not transfer its Shares (subject to certain exceptions), and (iii) waive and not to exercise any appraisal rights in respect of such Shares that may arise with respect to the Merger and not to commence or participate in, any class action or legal action (a) challenging the validity of, or seeking to enjoin or delay the operation of any provision of the Merger Agreement or (b) with respect to claims against the Checkpoint Board, or any committee thereof, Parent of Merger Sub relating to the Merger Agreement or the transactions contemplated thereby.

Under the Support Agreement, subject to the occurrence of the Effective Time, Fortress also agreed to forgo any further payment, dividend or distribution, or issuance or transfer of securities by Checkpoint on or after the date of the Support Agreement pursuant to the Amended and Restated Founders Agreement, dated as of July 11, 2016, between Fortress and Checkpoint and certain other agreements between Fortress and Checkpoint.

The Support Agreement also includes certain representations and warranties and covenants of Fortress to Parent, including certain restrictive covenants that apply to Fortress following the Effective Time.

As of March 9, 2025, Fortress beneficially owned an aggregate of approximately 11.2% of the outstanding Shares (consisting of 6,222,249 shares of common stock and 700,000 shares of Class A common stock) and controlled a majority of the outstanding voting power of Checkpoint’s capital stock through its ownership of all outstanding shares of Checkpoint’s Class A common stock. The Support Agreement will terminate upon termination of the Merger Agreement, the Effective Time and certain other specified events.

The foregoing description of the Support Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Support Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.

Royalty Agreement

Concurrently with the execution of the Merger Agreement, Checkpoint entered into a Royalty Agreement (the "Royalty Agreement") with Parent and Fortress pursuant to which following, and subject to the occurrence of, the Effective Time, Fortress will receive a royalty interest right based on worldwide net sales of certain products of Checkpoint and Parent. The royalty interest right represents the right to receive quarterly cash payments of 2.5% of net sales of such products during the time period set forth in the Royalty Agreement.

The foregoing description of the Royalty Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Royalty Agreement, a copy of which is attached hereto as Exhibit 10.2 and is incorporated herein by reference.

Transition Services Agreement

Pursuant to the Merger Agreement, as of or prior to the Effective Time, Checkpoint and Fortress will enter into a Transition Services Agreement (the "Transition Services Agreement"), pursuant to which, from and after the Effective

Time, Fortress would provide Checkpoint with certain transition services as set forth in the Transition Services Agreement, for the period of time and in exchange for the compensation set forth therein.

The foregoing description of the Transition Services Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Transition Services Agreement, a copy of the form of which is attached hereto as Exhibit C to the Merger Agreement and is incorporated herein by reference.

On March 9, 2025 Sun Pharmaceutical Industries Limited (Reuters: SUN.BO, Bloomberg: SUNP IN, NSE: SUNPHARMA, BSE: 524715 (together with its subsidiaries and/or associated companies, "Sun Pharma")) and Checkpoint Therapeutics, Inc. (Nasdaq: CKPT) ("Checkpoint") reported that they have entered into an agreement by which Sun Pharma will acquire Checkpoint, an immunotherapy and targeted oncology company (Press release, Sun Pharma, MAR 9, 2025, View Source [SID1234651025]).

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Checkpoint is a Nasdaq-listed commercial-stage company focused on developing novel treatments for patients with solid tumor cancers. Checkpoint has received approval from the U.S. Food & Drug Administration (FDA) for UNLOXCYT (cosibelimab-ipdl) for the treatment of adults with metastatic cutaneous squamous cell carcinoma (cSCC) or locally advanced cSCC who are not candidates for curative surgery or curative radiation.

Dilip Shanghvi, Chairman & Managing Director of Sun Pharma, said, "Combining UNLOXCYT, an FDA-approved anti-PD-L1 treatment for advanced cutaneous squamous cell carcinoma, with Sun Pharma’s global presence means patients with cSCC may soon have access to an important, new treatment option. The acquisition further bolsters our innovative portfolio in onco-derm therapy."

"I am proud of the dedication and passion of our team at Checkpoint that allowed us to achieve the first and only FDA-approved anti-PD-L1 treatment for patients with advanced cSCC, and we are excited to enter this transaction with Sun Pharma as the next step to bringing UNLOXCYT to cSCC patients in need of a differentiated immunotherapy treatment option," said James Oliviero, President and Chief Executive Officer of Checkpoint. "Sun Pharma is aligned with Checkpoint’s commitment to improving the lives of skin cancer patients, and I believe this transaction will maximize value for our stockholders and provide accelerated access to UNLOXCYT in the United States, Europe and other markets worldwide."

Transaction Summary

Upon completion of the transaction, Sun Pharma will acquire all outstanding shares of Checkpoint and Checkpoint stockholders will receive, for each share of common stock they hold, an upfront cash payment of $4.10, without interest, and a non-transferable contingent value right (CVR) entitling the stockholder to receive up to an additional $0.70 in cash, without interest, if cosibelimab is approved prior to certain deadlines in the European Union pursuant to the centralized approval procedure or in Germany, France, Italy, Spain or the United Kingdom, subject to the terms and conditions in the contingent value rights agreement.

The upfront cash payment of $4.10 per share of common stock represents a premium of approximately 66.0% to Checkpoint’s closing share price on March 7, 2025, the last trading day prior to today’s announcement.

In connection with the transaction, Checkpoint, Sun Pharma and Fortress Biotech, Inc., Checkpoint’s controlling stockholder ("Fortress"; Nasdaq: FBIO), have entered into a royalty agreement, under which following the closing of the transaction Fortress would be entitled to receive royalty payments based on future sales of cosibelimab during a specified term, in lieu of royalty rights that were granted to Fortress in connection with its founding of Checkpoint.

In connection with the evaluation of Checkpoint’s strategic alternatives, the Checkpoint board of directors (the "Board") formed a special committee of independent and disinterested directors (the "Special Committee"), which led the review and negotiations for this transaction. The Special Committee, with the assistance of its independent financial and legal advisors, conducted a comprehensive review of potential strategic alternatives available to Checkpoint and ultimately determined that the compelling and certain cash consideration and meaningful upside presented by the CVRs in this transaction provides superior risk-adjusted value relative to Checkpoint’s standalone prospects and other available alternatives. The Special Committee unanimously approved, and recommended that Checkpoint’s Board approve, the proposed transaction. After considering this recommendation, Checkpoint’s Board unanimously approved the proposed transaction. In arriving at its unanimous recommendation in favor of the transaction, the Special Committee considered several additional factors which will be outlined in public filings to be made by Checkpoint.

The transaction is expected to be completed in the second calendar quarter of 2025. The transaction is subject to customary closing conditions, including required regulatory approvals and approval by the holders of a majority of the voting power of outstanding shares of Checkpoint common stock, and by the holders of a majority of the shares of Checkpoint common stock that are not held by Fortress or by certain other affiliates of Checkpoint.

For the nine-month period ending September 2024, Checkpoint reported $0.04 million in revenue and a net loss of $27.3 million. The R&D expense for the nine-month period was $19.3 million. As of September 30, 2024, Checkpoint had a cash balance of $4.7 million, outstanding accounts payable and accrued expenses of $15.6 million, and outstanding accounts payable and accrued expenses – related party of $2.0 million.

In connection with the transaction, Fortress, which holds a majority of Checkpoint’s outstanding voting power, has agreed to vote in favor of the transaction.

Advisors

Barack Ferrazzano Kirschbaum & Nagelberg LLP and Allen Overy Shearman Sterling US LLP are serving as legal advisors to Sun Pharma.

Locust Walk is serving as the exclusive financial advisor to Checkpoint and lead financial advisor to Checkpoint on the transaction.

Cooley LLP and Morris, Nichols, Arsht & Tunnell LLP are serving as legal advisors to the Special Committee. Kroll, LLC is serving as financial advisor to the Special Committee.

Alston & Bird LLP is serving as legal advisor to Checkpoint.

About Cutaneous Squamous Cell Carcinoma

cSCC is the second-most common type of skin cancer in the United States, with an estimated annual incidence of approximately 1.8 million cases according to the Skin Cancer Foundation. Important risk factors for cSCC include chronic ultraviolet exposure and immunosuppressive conditions. While most cases are localized tumors amenable to curative resection, each year approximately 40,000 cases become advanced and an estimated 15,000 people in the United States die from this disease. In addition to being a life-threatening disease, cSCC causes significant functional morbidities and cosmetic deformities due to tumors that commonly arise in the head and neck region, and that invade blood vessels, nerves and vital organs, such as the eye or ear.

On March 9, 2025, Checkpoint Therapeutics, Inc., a Delaware corporation ("Checkpoint" or the "Company"), reported to have entered into an Agreement and Plan of Merger (the "Original Merger Agreement") with Sun Pharmaceutical Industries, Inc., a Delaware corporation ("Sun Pharma" or "Parent"), and Snoopy Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent ("Merger Sub") (Filing, Checkpoint Therapeutics, MAR 9, 2025, View Source [SID1234651933]). The Original Merger Agreement provides that, on the terms and subject to the conditions set forth in the Original Merger Agreement, Parent, Merger Sub and the Company will effect a merger of Merger Sub with and into the Company (the "Merger"), with the Company continuing as the surviving corporation of the Merger and a wholly owned subsidiary of Parent. Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to such terms in the Original Merger Agreement.

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On April 14, 2025, the Company, Parent and Merger Sub entered into an Amendment to the Original Merger Agreement (the "Merger Agreement Amendment" and the Original Merger Agreement, as amended by the Merger Agreement Amendment, the "Merger Agreement"). Pursuant to the Merger Agreement Amendment, the definition of "Company Required Vote" is revised to mean "(a) the affirmative vote of a majority of the votes cast at a duly convened meeting of the Company Stockholders by the Unaffiliated Company Stockholders and (b) the affirmative vote of the holders of a majority in voting power of the outstanding Company Common Stock, in the case of each of clause (a) and (b), in favor of the adoption of this Agreement."

Other than as expressly set forth in the Merger Agreement Amendment, the Original Merger Agreement remains unmodified and in full force and effect in accordance with its terms.

A special committee (the "Special Committee") of independent and disinterested members of the Company’s board of directors (the "Company Board") unanimously adopted resolutions recommending that the Company Board approve, adopt and declare advisable the Merger Agreement and submit to the Company’s stockholders, and recommend the adoption by the Unaffiliated Company Stockholders of, the Merger Agreement. Thereafter, the Company Board unanimously authorized and approved the Merger Agreement Amendment and recommended that the stockholders of the Company adopt the Merger Agreement. The Special Committee unanimously determined that the Merger Agreement and the transactions contemplated thereby are advisable, fair to and in the best interests of the Company and the Unaffiliated Company Stockholders. Upon the Special Committee’s recommendation, the Company Board determined that the Merger Agreement and the transactions contemplated thereby are advisable, fair to and in the best interest of the Company and its stockholders.

The foregoing description of the Merger Agreement Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement Amendment, which is filed as Exhibit 2.1 to this Current Report on Form 8-K and the full text of the Original Merger Agreement, a copy of which is attached as Exhibit 2.1 to Checkpoint’s Current Report on Form 8-K, filed with the U.S. Securities and Exchange Commission (the "SEC") on March 10, 2025, each of which is incorporated herein by reference. A copy of the Merger Agreement Amendment has been included to provide Company stockholders and other security holders with information regarding its terms and is not intended to provide any factual information about the Company, Parent, Merger Sub or their respective affiliates. The representations, warranties and covenants contained in the Merger Agreement have been made solely for the purposes of the Merger Agreement and as of specific dates; were made solely for the benefit of the parties to the Merger Agreement; are not intended as statements of fact to be relied upon by Company stockholders or other security holders, but rather as a way of allocating the risk between the parties in the event the statements therein prove to be inaccurate; have been modified or qualified by certain confidential disclosures that were made between the parties in connection with the negotiation of the Merger Agreement, which disclosures are not reflected in the Merger Agreement itself; may no longer be true as of a given date; and may apply standards of materiality in a way that is different from what may be viewed as material by Company stockholders or other security holders. Company stockholders and other security holders are not third-party beneficiaries under the Merger Agreement (except, following the Effective Time, with respect to Company stockholders’ right to receive the Merger Consideration and the right of holders of Company equity awards and Company Warrants to receive the consideration provided for such securities pursuant to the Merger Agreement) and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the Company, Parent, Merger Sub or their respective affiliates. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures. The Company acknowledges that, notwithstanding the inclusion of the foregoing cautionary statements, it is responsible for considering whether additional specific disclosures of material information regarding material contractual provisions are required to make the statements in this Form 8-K not misleading. Notwithstanding the foregoing, information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement, and unless required by applicable law, Checkpoint undertakes no obligation to update such information.

The Merger Agreement should not be read alone but should instead be read in conjunction with the other information regarding the Merger Agreement, the Merger, the Company, Parent, Merger Sub, their respective affiliates and their respective businesses, that will be contained in, or incorporated by reference into, the proxy statement that the Company will file in connection with the transactions contemplated by the Merger Agreement, as well as in the Forms 10-K, Forms 10-Q, Forms 8-K and other filings that the Company will make with the Securities and Exchange Commission.