Item 1.01. Entry into a Material Definitive Agreement.
On January 9, 2022, Stoke Therapeutics, Inc., a Delaware corporation (the
"Company") entered into a License and Collaboration Agreement (the "Agreement")
with Acadia Pharmaceuticals Inc. ("Acadia") for the discovery, development and
commercialization of novel RNA-based medicines for the treatment of severe and
rare genetic neurodevelopmental disease of the central nervous system ("CNS").
The Agreement focuses on the targets SYNGAP1, MECP2 (Rett syndrome), and an
undisclosed neurodevelopmental target of mutual interest. In connection with
each target, the parties will collaborate to identify potential treatments for
further development and commercialization as licensed products. With respect to
SYNGAP1, the parties have agreed to co-develop and co-commercialize licensed
products for such target globally, and in connection therewith the Company
granted to Acadia worldwide, co-exclusive (with the Company) licenses for such
licensed products. With respect to MECP2 and the neurodevelopmental target, the
Company granted to Acadia worldwide, exclusive licenses to develop and
commercialize licensed products for such targets.
Pursuant to the Agreement, Acadia will pay the Company an upfront payment in the
amount of $60,000,000. Acadia will fund the research to identify potential
licensed products for MECP2 and the neurodevelopmental target, and the parties
will equally fund the research to identify potential licensed products for
SYNGAP1. The Company is eligible to receive up to $907,500,000 in potential
total milestone payments based upon the achievement of certain development,
regulatory, first commercial sales and sales milestone events across the
programs for the three targets, assuming each milestone were achieved at least
once. With respect to licensed products for MECP2 and the neurodevelopmental
target, the Company is also eligible to receive tiered royalties at percentages
ranging from the mid-single digits to the mid-teens on future net sales by
Acadia of licensed products worldwide. Royalties payable under the Agreement are
subject to standard royalty reductions. For SYNGAP1 licensed products that the
parties are co-developing and co-commercializing, the Company will be
responsible for 50% of the development and commercialization costs and will
receive 50% of the profits from global commercialization.
With respect to each SYNGAP1 licensed product being co-developed or
co-commercialized, the Agreement will remain in effect, unless earlier
terminated, until the parties have agreed to permanently abandon the further
development and commercialization of such licensed product. With respect to
licensed products for MECP2 and the neurodevelopmental target, the Agreement
will remain in effect, unless earlier terminated, until the expiration, on
a country-by-country and licensed product-by-licensed product basis, of the
applicable royalty term, at which point the license for such licensed product
shall become fully paid-up, royalty-free, perpetual and irrevocable in such
country.
The Agreement also contains customary provisions for termination by Acadia for
convenience and by either party for cause, including for material breach
(subject to cure). The Company has standard reversion rights in connection with
certain early termination events.
The foregoing description of the terms of the Agreement does not purport to be
complete and is qualified in its entirety by reference to the full text of the
Agreement, a copy of which will be filed with the Securities and Exchange
Commission as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarter ending March 30, 2022.
Item 2.02. Results of Operations and Financial Condition
On January 10, 2022, the Company plans to present certain preliminary financial
and operating information in connection with a presentation (the "Presentation")
at the J.P. Morgan Healthcare Conference, including that the Company expects to
report that it had cash, cash equivalents, marketable securities and restricted
cash of approximately $220.4 million, and approximately 36.9 million shares of
common stock outstanding, as of December 31, 2021.
The Company's audited financial statements for the fiscal year ended
December 31, 2021, are not yet available. Accordingly, the preliminary financial
information included in the Presentation is an estimate subject to the
completion of the Company's financial closing procedures and any adjustments
that may result from the completion of the audit of the Company's financial
statements. The preliminary financial information may differ materially from the
actual results that will be reflected in the Company's audited financial
statements when they are completed and publicly disclosed.
The information in this Item 2.02 shall not be deemed "filed" for purposes of
Section 18 of the Securities Exchange Act of 1924, as amended (the "Exchange
Act"), or otherwise subject to the liabilities of that section, nor shall it be
deemed incorporated by reference into any other filing under the Exchange Act or
the Securities Act of 1933, as amended (the "Securities Act"), except as
expressly set forth by specific reference in such a filing.
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Item 7.01. Regulation FD.
Presentation
The Company is furnishing the Presentation, a full copy of which is attached
hereto as Exhibit 99.1.
Press Release
On January 10, 2022, the Company and Acadia issued a joint press release,
announcing their entry into the Agreement. A copy of the press release is
attached hereto as Exhibit 99.2.
The information furnished with this report, including Exhibit 99.1 and Exhibit
99.2, shall not be deemed "filed" for purposes of Section 18 of the Exchange
Act, or otherwise subject to the liabilities of that section, nor shall it be
deemed incorporated by reference into any other filing under the Exchange Act or
the Securities Act, except as expressly set forth by specific reference in such
a filing.
Item 8.01 Other Events
The Company also reported that its cash, cash equivalents, marketable securities
and restricted cash, including the upfront payment payable by Acadia pursuant to
the Agreement, are expected to fund operations into the second half of 2024.
Cautionary Note Regarding Forward-Looking Statements
This report contains forward-looking statements within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act of 1995,
including, but not limited to, statements regarding: receipt of upfront
payments; receipt of potential milestone payments under the SYNGAP1
collaboration; receipt of potential milestones and royalty payments under the
MECP2 program and the third program; the ability to develop new treatments for
neurodevelopmental diseases; expectations regarding the proposed transaction
with Acadia; and the Company's expected cash, cash equivalents, marketable
securities and restricted cash as of December 31, 2021. Statements including
words such as "believe," "plan," "will," "continue," "expect," "may," or
"ongoing" and statements in the future tense are forward-looking statements.
These forward-looking statements involve risks and uncertainties, as well as
assumptions, which, if they do not fully materialize or prove incorrect, could
cause the Company's results to differ materially from those expressed or implied
by such forward-looking statements. Forward-looking statements are subject to
risks and uncertainties that may cause the company's actual activities or
results to differ significantly from those expressed in any forward-looking
statement, including risks and uncertainties related to the Company's ability to
advance its product candidates, obtain regulatory approval of and ultimately
commercialize its product candidates, the timing and results of preclinical and
clinical trials, the company's ability to fund development activities and
achieve development goals, the Company's ability to protect intellectual
property and other risks and uncertainties described under the heading "Risk
Factors" in documents the Company files from time to time with the Securities
and Exchange Commission. These forward-looking statements speak only as of the
date of this press release, and the Company undertakes no obligation to revise
or update any forward-looking statements to reflect events or circumstances
after the date hereof.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number Description
99.1 Presentation, dated as of January 2022
99.2 Joint Press Release, dated as of January 10, 2022.
104 Cover Page Interactive Data File (the cover page XBRL tags are
embedded within the inline XBRL document).
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