Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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No worries, Heckler - looks like our two replies crossed at the same time.
Bill.
Potnak - yes, agreed. I guess it’s a risk/reward and an assessment of income v capital. A fairly complex commercial negotiation.
I think you are missing my point, Heckler.
Yes, with GSK assuming ownership of Sierra, they effectively assume the role of the license holder as set out in the agreement with the CPF.
What I was doing was responding to Thoth2's comment about licensing on SRA737 to a totally ***different*** party - in that case Zentalis. From what I can tell the agreement with the CPF doesn't give the freedom to do that. Thus if GSK want to go this route, they are going to have to agree something with the CPF. The agreement with the CPF only allows on licensing for non-oncology indications to a different/new party.
Bill.
Bill.
Apologies - my comments don’t cover the Zentalis scenario!
They could buy out of the agreement with CPF (and SAR) it would cost them at least the remaining milestones and maybe some on top to cover lost royalties. It might be an option worth paying for when you consider the royalties alone could be worth a couple of hundred million a year if it gets to market. The question is would the CPF go for it? I think they would, all profit made goes back into cancer research anyway. Sareum would largely be a bystander in a deal like this. This has been the very scenario I've been thinking of. Low cost, carrying less risk but big rewards if it goes to market.
Exactly, but that’s the whole point. The licensing entity doesn’t have to change - it’s still Sierra. Yesterday it was owned by many, diverse shareholders, tomorrow it’s owned exclusively by GSK.
Does the license agreement cover ownership or share structure of Sierra Oncology Inc. ?
I think there is a need to be a bit careful with assumptions as to whether GSK can on-license SRA737.
I went right the way through the Sierra/CPF agreement and the only allowance for on-licensing I could find was for non-oncology indications. For oncology, the licence is given to Sierra exclusively without any options I could see for on licensing/sub licensing.
So, if GSK does want to on-license in some way, to my eyes it looks like GSK will have to approach the CPF and work out an updated/new agreement of some kind to facilitate that transaction.
Bill.
Well one thing is for sure, if GSK don't get a move on with 737 immediately then I feel sorry for their comms team as their twitter feeds will get the same pasting that Sierra got!
https://www.globenewswire.com/en/news-release/2021/04/12/2208087/0/en/Zentalis-Pharmaceuticals-Enters-into-Clinical-Collaboration-and-Supply-Agreement-with-GlaxoSmithKline-to-Evaluate-its-Oral-WEE1-Inhibitor-ZN-c3-in-Combination-with-Niraparib-a-PARP.html
I have a suspicion 737 is going to be licenced to these guys.
Once they own Sierra, they can do what they want with “Sierra a GSK Company” and the products owned / licensed. They may wish to buy out the licenses for a fixed capital sum to avoid enduring payments…. that would be an interesting point to get to.
Very true. Legals still need to do their work though in order to make the necessary arrangements to ratify the deal. It will be interesting to see whether GSK want to take full control of SRA737 asap or leave it with Sierra. Either way, milestones should top up the coffers.
Sierra track record to date has been appalling.
In fact, this is why GSK bought Sierra instead of the licenses.
For both Momo and 737 if they’d attempted to take over the licenses they’d have had to go back to the holder and re-negotiate / novate the license. And clearly, as GSK rather than little Sierra, the terms would have been somewhat different!
Laz - I’m thinking that they wouldn’t need to do anything if Sierra remains a fully owned subsidiary of GSK?
Like all these….
https://www.gsk.com/media/7475/gsk-group-company-names-and-addresses.pdf
The result could be made known very quickly. There will be a lot of proxy votes and major shareholders will always vote. So we could know tonight or tomorrow.
On the assumption that it is voted for then SRA737 will become a GSK licence in all but name pending the legals etc: This will take time but it doesn't prevent behind the scenes discussions. Who knows, they may already have taken place.
I have also found it a bit odd that Sareum didn't go for a placing shortly after consolidation. Although we are ok at the moment I would say that there is always room for another £10m or so. Makes me think they are either waiting for a higher sp or, they know where they will get cash from.
Very interesting times. I see no downside barring an out and out disaster, but I do see plenty of scenarios that could play out - all of which are positive. GSK taking centre stage IMO.
I could be wide of the mark with my thinking but this remains a stonking buy.
Yes silence is hopefully golden in this case, I will also be waiting for I think multiple red dots over the coming days. All possible outcomes are in play at this moment. The Sierra deal could be the trigger event for news flow if that silence has been driven by NDAs and if as I suspect PH have been advising since appointed on the terms of a Commercial arrangement.
What suprises me and I think a few have mentioned it before maybe Thoth as well. Is no proactive interview for over a year even with that has happened let alone the HNWI's multiple investments.
You would have thought Dr Mitchell would be elated to mention we are cashed up for ph1. It's almost as if they are unavailable for comment.
For those who think the below links are a little too tenuous. Cast your mind back to this news in 2019. Gilead, Galapagos and Sareum all mentioned in the same article. Oh, and Galapagos still haven't spent that 5 billion dollars and Sareum still has an unpartnered TYK2. https://quoteddata.com/2019/07/trust-favourite-gilead-expands-deal-galapagos/
I’d expect it to close within 24 hours.
https://central.virtualshareholdermeeting.com/vsm/web?pvskey=SRRA2022SM
Any ideas on how quickly it'll go from the presumed 'yes' vote to the signed deal? Could be hours, could be days but we're bound to get a 'Sareum notes that....' update tomorrow.
11 weeks since the last RNS (discounting BioTrinity) which just happened to be about the GSK/Sierra deal. 11 weeks, nothing. Potnak, I completely agree with you, there is a reason for the silence and that just may be down to the execution of this deal. Tomorrow could (italicised) be most interesting.
I'm half expecting a yes vote in this meeting will start a chain reaction for everything else Sareum. I still think everything is hinged on this deal. Sierra, GSK, Gilead and by assotiation, Galapagos. I may be completely wrong and probably am but it would explain a lot of things if i am right. Very exciting though.
Assuming the GSK deal is approved we can expect confirmation from Sierra later this evening and an update, which may or may not reference SRA737, from GSK tomorrow. We shall have to wait and see whether Tim takes the opportunity to issue a confirmatory RNS….