Apellis Announces Collaboration with SFJ Pharmaceuticals for APL-2 in Hematologic Indications

Apellis Pharmaceuticals announced a novel, risk-sharing collaboration to support the development of APL-2 in hematologic indications with SFJ Pharmaceuticals, a global drug development company backed by Blackstone Life Sciences and Abingworth.

This collaboration marks the first time that SFJ Pharmaceuticals has partnered with a pre-revenue biopharma company. As part of this collaboration, SFJ and Apellis have entered into an agreement to support the development of APL-2 for the treatment of patients with paroxysmal nocturnal hemoglobinuria (PNH). Under the terms of the agreement, SFJ has agreed to pay Apellis $60 million in support of the PNH clinical program following deal close, with up to an additional $60 million based on Apellis meeting specific, pre-defined clinical milestones that are expected in 2019 and associated with the PNH development program, and subject to Apellis meeting certain capital requirements. Subject to mutual agreement, SFJ may also pay Apellis an additional $50 million in funding for the PNH clinical program following a specified, pre-defined clinical milestone.

In addition, Apellis and SFJ have entered into a letter of intent to negotiate and enter into a joint development agreement to support Apellis’ clinical development programs for APL-2 for the treatment of patients with cold agglutinin disease (CAD) and warm antibody hemolytic anemia (wAIHA). Following execution of the CAD/wAIHA joint development agreement, including agreed upon development plans, Apellis would receive up to $30 million in funding. Subject to mutual agreement, SFJ may also pay Apellis an additional $50 million in funding for the CAD and wAIHA clinical programs following a specified, pre-defined clinical milestone. Together the PNH agreement and the CAD/wAIHA agreement would provide the potential for up to $250 million in non-dilutive financing.

Under the terms of the PNH agreement, Apellis will pay SFJ regulatory approval milestone payments in annual increments at a pre-determined payment schedule over six years, with the majority of payments to SFJ due in years 3-6 following regulatory approval. No approval payments are owed to SFJ should regulatory approval not be achieved for PNH. Apellis has an option to buy-out of all or part of the milestone payments at any time following regulatory approval at a discounted rate. Apellis will retain exclusive worldwide commercial rights to APL-2 in all indications.

“This innovative collaboration with SFJ provides Apellis with substantial non-dilutive funding to develop APL-2 in hematologic diseases of complement with serious unmet need,” said Cedric Francois, CEO and co-founder of Apellis. “We are fortunate to partner with the highly experienced and qualified drug development professionals at SFJ Pharma, who have an outstanding track record of success. Under the terms of the collaboration, we will retain full commercial rights for APL-2 in all indications, have diversified our development risk and maintain considerable financial flexibility – both in terms of the amount of capital we can access and in regards to payment options following potential regulatory approval.”

“The collaboration with Apellis is particularly exciting for SFJ as it expands our business model to include pre-revenue biopharma companies,” said Bob DeBenedetto, CEO of SFJ. “After performing an in-depth diligence review of Apellis’ clinical data in PNH, CAD and wAIHA, as well as the PNH Phase 3 program design and commercial scale manufacturing capabilities, we believe that Apellis is the ideal partner with which to enter this novel agreement.”