Kite to Acquire Tmunity Therapeutics to Pursue Next Generation CAR T-Cell Therapy Advancements in Cancer
Kite, a Gilead Company (Nasdaq: GILD), and Tmunity Therapeutics (Tmunity), today announced that the companies have signed an agreement in which Kite will acquire Tmunity, a clinical-stage, private biotech company focused on next-generation CAR T-therapies and technologies. The acquisition of Tmunity complements Kite’s existing in-house cell therapy research capabilities by adding additional pipeline assets, platform capabilities, and a strategic research and licensing agreement with the University of Pennsylvania (Penn).
The acquisition will provide Kite with pre-clinical and clinical programs, including an ‘armored’ CAR T technology platform, which potentially could be applied to a variety of CAR T’s to enhance anti-tumor activity, as well as rapid manufacturing processes. Tmunity’s prostate-specific membrane antigen (PSMA) and prostate stem cell antigen (PSCA) assets are not part of the Kite acquisition and will be spun-out by Tmunity as part of the transaction.
As part of the acquisition, Kite will assume responsibility for continuing the research and development collaboration between Tmunity and Penn, also known as the Amended Research License Agreement (ARLA), which includes research funding to Penn along with options and licenses to certain cell engineering and manufacturing technologies invented and developed in certain Penn laboratories. Upon closing, the ARLA will be extended until 2026 with an option to extend further.
“Kite has demonstrated an ability to globally scale cell therapy and address the unique challenges and opportunities that cell therapy represents, which are quite different in material ways than traditional pharmaceutical or biotech approaches,” said Tmunity Founder Carl June, MD, who is also the Richard W. Vague Professor of Immunotherapy in Penn’s Perelman School of Medicine and director of Penn’s Center for Cellular Immunotherapies. “Kite’s singular focus on cell therapy makes them unique and particularly nimble.”
Tmunity was formed in 2015 by some of the early innovators in the cell therapy field, the University of Pennsylvania’s Dr. June, Bruce Levine, PhD, James Riley, PhD and Anne Chew, PhD. The company was formed to rapidly advance early-stage cell therapy research and innovation done in academia into the clinic, to produce new treatments for patients with unmet needs.As part of Kite’s acquisition, the Tmunity founders will become senior scientific advisors for Kite.
“We believe that the impact cell therapy is making for patients today is just the start of what is possible,” said Christi Shaw, Chief Executive Officer of Kite. “The Kite team is thrilled to be joining forces with the researchers at Tmunity who are rapidly advancing cell therapy research from the labs into the clinic through their unique partnership with the University of Pennsylvania. Together, we bring a deep understanding of cell therapy as an effective platform, and combined with Kite’s industry-leading global scale, we collectively have a singular focus: to use cell therapy to develop potential cures, and to get them to patients as quickly as possible.”
Dr. June, a visionary researcher who helped shape the development of innovative cell therapies beginning in the 1980s, leads a team at Penn which, working across basic and clinical research settings, helped ignite the promise of cell therapy.
“The Tmunity team is excited by the potential to become part of Kite and see what we can accomplish together to write the next chapter on what cell therapy is capable of,” said Beth Seidenberg, MD, Non-Executive Chairwoman of Tmunity and Founding Managing Director of Westlake Village BioPartners. “This acquisition is about unlocking ways to help more patients, and do so more quickly, than either team could do alone.”
The transaction is expected to close in the first quarter of 2023, and after closing, Tmunity’s employees will join Kite. Closing of the transaction is subject to expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions.
The financial terms of the agreement were not disclosed. Kite will acquire all outstanding shares of Tmunity other than those already owned by Kite. Beginning in the first quarter of 2022, consistent with guidance from the U.S. Securities and Exchange Commission (SEC), Gilead no longer excludes acquired IPR&D expenses from its non-GAAP financial measures and expects the transaction with Tmunity to reduce Gilead’s GAAP and non-GAAP 2023 EPS by approximately $0.18-$0.22.
Drs. June, Levine, Riley, and Chew are all individual equity holders in Tmunity and as part of this agreement will become paid scientific advisors to Kite. Penn receives sponsored research funding from Tmunity, and as inventors of some of the licensed technology, Drs. June, Levine, Riley, and Chew, along with Penn, may receive additional financial benefits under the license in the future. Penn is also an investor in Tmunity and holds equity interests.
The other major investors in Tmunity include Westlake Village Biopartners, Andreessen Horowitz (also known as “a16z”), Parker Institute for Cancer Immunotherapy, Gilead Sciences, Kleiner Perkins, Resilience, Lilly Asia Ventures, Crystal South, Be The Match, and BrightEdge, the philanthropic impact fund of the American Cancer Society.
Cowen is acting as financial advisor to Kite. Centerview Partners is acting as financial advisor and Cooley and Ropes & Gray are acting as legal advisors to Tmunity.
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