UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) December 19, 2005
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Pharmion Corporation
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(Exact name of registrant as specified in its charter)
Delaware 000-50447 84-1521333
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(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
2525 28th Street, Boulder, Colorado 80301
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 720-564-9100
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
On December 19, 2005, Pharmion GmbH, a limited liability
company registered in Switzerland ("Pharmion GmbH") and a
wholly-owned indirect subsidiary of Pharmion Corporation, a
Delaware corporation (the "Company"), and GPC Biotech AG ("GPC
Biotech"), entered into a Co-Development and License Agreement
and a Supply Agreement.
The Co-Development and License Agreement ("CDLA"):
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Pursuant to the CDLA, Pharmion GmbH acquired exclusive
commercialization rights, including the right to develop, market
and distribute, that certain platinum complex,
af-bis(acetato)-b-ammine-cd-dichloro-e-(cyclohexylamine)platinum
(IV), known commercially as satraplatin, in Europe, Turkey, the
Middle East, Australia and New Zealand.
Pharmion GmbH will provide an upfront payment to GPC Biotech
of $37.1 million, which includes an $18 million reimbursement for
past satraplatin clinical development costs and a $19.1 million
payment for the funding of certain clinical development
activities to be conducted jointly by Pharmion GmbH and GPC
Biotech. The parties will form a joint development committee to
coordinate, evaluate and expedite global development activities
for satraplatin in a variety of tumor types. The parties will
share costs incurred in connection with global development
activities conducted under a development plan agreed to by the
parties, toward which Pharmion GmbH has made an additional
commitment of approximately $22.2 million. In addition, Pharmion
GmbH will pay GPC Biotech $30.5 million upon the achievement of
initial regulatory filing and approval milestones, and $15
million for each subsequent regulatory approval for certain
additional indications up to a maximum of $75 million for such
approvals.
GPC Biotech will also receive royalties on sales of
satraplatin by Pharmion GmbH in its territories at rates of 26 to
30 percent on annual sales up to $500 million, and 34 percent on
annual sales over $500 million. Finally, Pharmion GmbH is
obligated to pay GPC Biotech up to $105 million for achievement
of significant annual sales milestones in the Pharmion GmbH
territories. Pharmion GmbH and GPC Biotech will each lead
regulatory and commercial activities relating to the promotion
and sale of satraplatin in their respective territories.
During the term of the CDLA, the Company has agreed to
maintain the financial viability of Pharmion GmbH, such that
Pharmion GmbH
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will have sufficient funds available to satisfy its monetary
obligations under the CDLA.
The CDLA terminates on a country by country basis on the
last to occur of: (a) the date that sales of a generic product
containing satraplatin by one or more third parties in a country
in any six-month period exceed, on a per unit basis, a specified
threshold amount of the entire market for products containing
satraplatin in such country; (b) the last day of the defined
royalty term in the GPC Biotech and Spectrum Pharmaceuticals,
Inc. Co-Development and License Agreement, dated September 30,
2002, a redacted copy of which is on file with the United States
Securities and Exchange Commission, as Exhibit 10.1 to GPC
Biotech's Form F-1, dated June 9, 2004; (c) the expiration date
in such country of the last to expire of any GPC Biotech patent
or patent held jointly between the parties to the CDLA that
includes at least one valid claim that would be infringed by the
sale of satraplatin; and (d) expiration of any period of data,
market or other regulatory exclusivity available in the Pharmion
GmbH territory. Upon termination, Pharmion GmbH retains a
non-exclusive, fully-paid, royalty-free license to continue the
commercialization of satraplatin in the Pharmion GmbH territory.
The Supply Agreement:
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Pursuant to the terms of the Supply Agreement, Pharmion GmbH
has agreed to purchase 100 percent of its requirements for
satraplatin from GPC Biotech, and GPC Biotech has agreed to
manufacture and supply the requirements of Pharmion GmbH for, and
maintain certain inventories of, satraplatin. Pricing is based
upon 110 percent of the fully allocated cost of manufacture,
subject to annual adjustment.
The parties will form a joint manufacturing committee to,
among other things, oversee activities with respect to the
manufacture of satraplatin, to coordinate regulatory activities
relating to its manufacture and to establish work plans for
analytical methods transfer.
Press Release:
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A copy of the press release announcing the transaction
described in this report is attached as Exhibit 99.1 to this
Current Report on Form 8-K and is incorporated herein by
reference.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
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99.1 Press Release issued by the Company on December 20, 2005.
This report contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, without limitation,
discussion relative to markets for our products and trends in
revenue, gross margins and anticipated expense levels, as well as
other statements including words such as "anticipate," "believe,"
"plan," "estimate," "expect" and "intend" and other similar
expressions. All statements regarding our expected financial
position and operating results, business strategy, financing
plans, forecast trends relating to our industry are
forward-looking statements. These forward-looking statements are
subject to business and economic risks and uncertainties, and our
actual results of operations may differ materially from those
contained in the forward-looking statements. Factors that could
cause or contribute to such differences include, but are not
limited to, those factors set forth under "Factors Affecting our
Business Conditions" in our Quarterly Report on Form 10-Q for the
quarter ended September 30, 2005. As a result, you should not
place undue reliance on these forward-looking statements. We
undertake no obligation to revise these forward-looking
statements to reflect future events or developments.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PHARMION CORPORATION
Date: December 22, 2005 By: /s/ Erle T. Mast
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Name: Erle T. Mast
Title: Chief Financial Officer