On November 14, 2023, Xencor reported that it has entered into an Amended and Restated Collaboration and License Agreement (the "New Collaboration Agreement") with Genentech, Inc., a Delaware corporation, having its principal place of business at 1 DNA Way, South San Francisco, California 94080 ("GNE"), and F. Hoffmann-La Roche Ltd, a corporation organized and existing under the laws of Switzerland, having its principal place of business at Grenzacherstrasse 124, CH 4070 Basel, Switzerland ("Roche") (GNE and Roche, collectively, "Genentech") (Filing, 8-K, Xencor, NOV 15, 2023, View Source [SID1234637709]). The New Collaboration Agreement is effective as of June 1, 2024 (the "Effective Date") and, as of that date, will replace the current Collaboration and License Agreement between the Company and Roche which was entered into on February 4, 2019 (the "Original Collaboration Agreement"). The Original Collaboration Agreement will remain effective for the period between February 4, 2019 and the Effective Date.

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The Company has exercised its option under the Original Collaboration Agreement to convert its current development cost and profit-sharing arrangement with Genentech into a royalty and milestone payment financial arrangement (the "Royalty Conversion"). Pursuant to the terms of the New Collaboration Agreement, the Company and Genentech have agreed on the financial and other terms to implement the Royalty Conversion. Pursuant to the Royalty Conversion, in connection with any program under the Original Collaboration Agreement, including XmAb306 (RO7310729), the Company will be entitled to receive tiered royalties on a product-by-product and country-by-country basis ranging from low double-digit to mid-teens percentages. The Company will also be entitled to receive up to $600 million in milestones, including $115 million in development milestones, $185 in regulatory milestones and $300 million in sale-based milestones.

Pursuant to the terms of the New Collaboration Agreement, after the Effective Date, Genentech will assume sole responsibility over all clinical, regulatory, and commercial activities.

The descriptions of the contractual arrangements contained herein do not purport to be complete and are qualified in their entirety by reference to the copy of the actual agreement which will be filed as exhibits to the Company’s Annual Report on Form 10-K for the period ending December 31, 2023.