with certain applicable option exercise letters we have sent to Adimab, we refer to as the Adimab Collaboration Agreement. We are developing antibodies discovered under the Adimab Collaboration
Agreement in our ASN100 monoclonal antibody program.
Under the Adimab Collaboration Agreement, Adimab and Arsanis were required to use reasonable efforts
to conduct certain research, which we funded, to discover and optimize antibodies directed against targets selected by us. Prior to our exercise of an option (as described in the next paragraph), (1) we and Adimab each grant the other a
non-exclusive
license to the relevant intellectual property we own to allow each party to carry out its rights and obligations in connection with the research, and (2) except for certain rights of Adimab to
continue using and licensing its own libraries, each party agrees not to practice or license the patents arising out of the research that it owns for any purpose other than to carry out its rights and obligations in connection with the research.
With respect to each target that was the subject of the research, we had an exclusive option to obtain, with respect to a specified number of antibodies
directed against such target and discovered or optimized by Adimab, (1) ownership of certain patent rights relating to such antibodies and (2) exclusive and
non-exclusive
licenses, with the right to
grant sublicenses, in all human therapeutic, prophylactic and diagnostic areas, which we refer to as the licensed field, under certain patent rights and
know-how,
to research, develop, make, have made, use,
sell, offer to sell, import and export such antibodies and products based on such antibodies (but not for antibody discovery purposes). In addition, upon exercise of each option, certain contractual restrictions on our ability to prosecute, practice
and license certain patents owned by us that arose out of the research were eliminated. All of our options under the Adimab Collaboration Agreement have expired, or are in the process of being exercised, or, with respect to multiple targets and
hundreds of antibodies, have already been exercised. For each target for which we have exercised an option, we are required to use commercially reasonable efforts to develop and commercialize at least one product in major markets.
Under the Adimab Collaboration Agreement, we have paid Adimab approximately $4.3 million in the aggregate to date, consisting of upfront payments and
reimbursement for research conducted by Adimab. Among other payment obligations, we are obligated to pay Adimab royalties at a mid single-digit percentage of net sales, made by us or our affiliates, of products based on antibodies for which we have
exercised our option, or products that use or are based on any antibody discovered or optimized under the agreement, any derivative or modified version of any such antibody, or any sequence information as to any such antibody. The above payment
obligations are subject to carve-outs for, among other things, sales of certain antibody products if they are sold at cost in developing countries under our April 2017 letter agreement with the Bill & Melinda Gates Foundation (described in
more detail below). We have not made any payments to Adimab pursuant to the Adimab Collaboration Agreement since January 1, 2017.
Adimab Option
and License Agreement
We are also party to an option and license agreement with Adimab that we entered into in February 2017, which we refer to as the Adimab Option Agreement. We are developing antibodies discovered under the Adimab Option
Agreement in our ASN500 monoclonal antibody program.
Under the Adimab Option Agreement, Adimab has provided to us certain proprietary antibodies against
respiratory syncytial virus, or RSV, which we refer to as the initial RSV antibodies, for our evaluation during a specified option period and has granted us an exclusive,
non-sublicensable
license under
certain Adimab patent rights and
know-how
during the option period to create, research, optimize, make, have made and use the initial RSV antibodies and modified or derivative forms of the initial RSV
antibodies. Adimab has performed affinity maturation of a limited number of the initial RSV antibodies for us and provided us with a specified number of higher-affinity RSV antibodies resulting from those activities. In addition, we are conducting
our own research program with respect to these RSV antibodies.
Under the Adimab Option Agreement, we have an exclusive option, exercisable during the
option period upon payment of an option fee to Adimab, to require Adimab to assign to us all rights in up to a specified number of
- 20 -