ZYMEWORKS BC INC. : Entry into Material Definitive Agreement, FD Settlement Disclosure, Financial Statements and Exhibits (Form 8-K)

ARTICLE 1.01 Entering into a Material Definitive Agreement.

On October 18, 2022the company, a subsidiary of zymeworkshas entered into a collaboration and license agreement (the “Collaboration and License Agreement”) with Jazz, granting Jazz the exclusive rights to develop and commercialize the Company’s proprietary HER2 bispecific antibody product candidate known as zanidatamab worldwide, but excluding the People’s Republic of China,
Australia, New Zealand, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan,
Uzbekistan, hong kong, Taiwan, Macau, Mongolia, South Korea, Brunei Darussalam,
Cambodia, Indonesia, Papua New GuineaLaotian People’s Democratic Republic,
Malaysia, Burma, Philippines, Singapore, ThailandTimor-Leste, and Vietnam
(the Territory”). BeiGene, Ltd. has exclusive rights, pursuant to an agreement with the Company dated November 26, 2018as amended (the “BeiGene Agreement”), to commercialize zanidatamab in the countries excluded from the Territory.

Licenses. Pursuant to the license and collaboration agreement, the Company has granted Jazz an exclusive license, together with royalties, with the right to sub-license, under certain elements of the Company’s intellectual property, to the research, development, manufacture and marketing in the Territory of pharmaceutical products containing or incorporating zanidatamab or certain related antibodies (such antibodies, collectively, “Licensed Antibodies” and pharmaceutical products, “Licensed Products”) . Licensed Antibodies and Licensed Products expressly exclude all antibody-drug conjugates, including the Company’s proprietary antibody-drug conjugate, zanidatamab zovodotin (also known as ZW49). The Company has also granted Jazz a non-exclusive license, with the right to sublicense, under certain Company intellectual property, to research, preclinical development and manufacture of Licensed Products to outside the Territory for the sole purpose of promoting the development and marketing of Licensed Products in the Territory.

Jazz has granted the Company certain licenses under certain Jazz intellectual property to develop and commercialize Licensed Antibodies and Licensed Products outside of the Territory, to conduct certain development and manufacturing activities relating to Licensed Products in the Territory, and to manufacture and cause to be manufactured Antibodies under license for incorporation into zanidatamab zovodotin, for development and commercialization inside and outside the Territory. If the BeiGene Agreement is terminated, in whole or in part, Jazz has a right of first negotiation to develop or commercialize any licensed product in such countries. The licenses granted by the Company and Jazz are effective upon receipt of the United States Hart-Scott Rodino Antitrust Improvements Act of 1976 authorization (such authorization, the “HSR Authorization”).

Exclusivity. During the Term (as defined below), Jazz and its Affiliates are prohibited from conducting any clinical development or commercialization of any pharmaceutical product containing a bispecific antibody directed against the ECD2 and ECD4 domains of HER2 in the Territory. , other than Licensed Products. . During the Term, the Company and its affiliates are prohibited from carrying out any preclinical development (except for certain independent internal preclinical development by the Company or its affiliates) or clinical development of, or commercialization of, any pharmaceutical product that is directed to HER2 in the Territory (each, a “Zymeworks Competitive Product”), other than the Licensed Products; provided that zanidatamab zovodotin is excluded from this restriction. The Company reserves the right to grant third parties the right to apply any of the Company’s platforms to derive or generate, without any assistance from the Company, antibodies directed against any biological target when the Company does not is not aware of the identity of this target, and the Company retains the right to fulfill its obligations under the agreements with its existing platform partners; provided, however, that the Company may not generate or grant licenses to develop or commercialize products competing with Zymeworks in new agreements based on the platform entered into after the effective date of the agreement of license and collaboration.

Development, regulation, manufacturing and marketing. As between Jazz and Company, Jazz shall be solely responsible for all development and commercial activities with respect to the Licensed Products in the Territory, and all such development and commercial activities in the Territory shall be at Jazz’s sole cost and expense, except that the Company will be responsible for continuing clinical trials of zanidatamab initiated by Company prior to execution of the License and Collaboration Agreement (collectively, “Zymeworks Ongoing Studies”), including clinical trials initiated by Company in South Korea, and the filing of the first Biologics License Application for the Licensed Product (the “First BLA”), at Jazz’s expense and expense, subject to the terms and conditions of the License and Collaboration Agreement. Following regulatory approval of the first BLA or sooner upon Jazz’s written request, the Company will promptly transfer the first BLA to Jazz.


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Jazz will use commercially reasonable efforts to develop and obtain regulatory approval of a licensed product in certain major markets for the treatment of certain diseases. Jazz will be the holder of regulatory approvals and regulatory submissions for Licensed Products in the Territory, except for Zymeworks’ ongoing studies and the first BLA until it is transferred to Jazz.

The Company, either itself or through the Company’s contract manufacturing organization, will manufacture and Jazz will purchase from the Company Jazz’s requirements for zanidatamab and produce under license until Jazz or Jazz Contract Manufacturer is authorized to manufacture the Licensed Antibody and Licensed Product, or until two years after the closing of the License and Collaboration Agreement (closing of which is subject to receipt of the HSR clearance), whichever is later. Thereafter, the Company will manufacture for Jazz, and Jazz will purchase from the Company, certain quantities of zanidatamab and the Licensed Product until such manufacturing is fully transferred to Jazz, but no later than three years after Closing. The supply of zanidatamab and the licensed product will be further defined in separate clinical and commercial supply agreements to be executed by the parties.

Jazz will be solely responsible for marketing the Licensed Products in the Territory and will use commercially reasonable efforts to market in each specified major market country each Licensed Product that obtains regulatory approval in that country. Jazz will conduct such marketing at its sole cost and expense.

Financial conditions. Jazz has agreed to pay the Company an upfront non-refundable payment of $50.0 millionwhich will be due and payable by Jazz to the Company after receipt of the HSR authorization, and if Jazz decides that it wishes to retain its licenses and other rights under the license and collaboration agreement, then it must make a payment additional $325.0 million to the Company within a specified period of time after the later of (i) the date the HSR authorization is received and (ii) the date the Company provides Jazz with the master data from the database of trial locked and cleaned for the zymeworks
ongoing study of zanidatamab in subjects with advanced or metastatic HER2-amplified bile duct cancers (HERIZON-BTC-01), known as ZWI-ZW25-203, together with all data, analysis and other information set out in the License and Collaboration Agreement. Jazz’s failure to make this last payment before the end of this period will result in the automatic and immediate termination of the License and Collaboration Agreement. Jazz will reimburse Company for Company’s performance of development activities under the License and Collaboration Agreement in accordance with a development plan and budget. Jazz has also agreed to pay the Company potential regulatory milestone payments up to an aggregate of $525.0 millionand potential commercial milestone payments up to a total of $862.5 million.

Pending approval, Company is eligible to receive tiered royalties between 10% and 20% on annual net sales of Licensed Products in the Territory, with customary reductions in specified circumstances. Royalties are payable on a licensed product-by-licensed product-by-country basis until no later than (i) 10 years after the first commercial sale of such licensed product in that country, (ii) the expiration of the last valid claim period patent rights under the Company’s licensed intellectual property covering such licensed product in such country, and (iii) the expiration of the regulatory exclusivity of such licensed product in such country.

Intellectual property. The Company is the sole owner of all inventions made by the parties alone or jointly that specifically relate to the composition of zanidatamab matter and of any inventions made solely by the Company and its affiliates. Jazz owns all inventions made solely by Jazz. Inventions made jointly by the parties are the joint property of the parties.

Term and Termination. Unless terminated earlier, the term of the License and Collaboration Agreement will continue on a Licensed Product-by-Licensed Product and country-by-country basis until the expiration of the Royalty Term for such Licensed Product in that country (the “Term”). ) . Country by country, . . .

ARTICLE 7.01 Disclosure of FD Rules.

On October 19, 2022, zymeworks and Jazz issued a joint press release regarding the licensing and collaboration agreement. Also on October 19, 2022, zymeworks
issued a press release regarding the license and collaboration agreement. Copies of these press releases are provided as Exhibits 99.1 and 99.2 to this report and are incorporated herein by reference.

The information set forth in this Section 7.01 and in Exhibits 99.1 and 99.2 hereto is for furnishing purposes and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to liability of this section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly provided by specific reference in such filing.

ARTICLE 9.01 Financial Statements and Supporting Documents.

(d) Exhibits.

  No.     Description

99.1        Joint Press Release dated October 19, 2022.

99.2        Zymeworks Press Release dated October 19, 2022.

104       Cover Page Interactive Data File (embedded as Inline XBRL document).


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