UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-K
(Mark One)
For the fiscal year ended December 31, 2011
For the transaction period from __________ to __________
Commission file number: 000-53127
GENESIS BIOPHARMA, INC.
(Exact Name of Registrant as Specified in Its Charter)
(866) 963-2220
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g)
of the Act:
Common Stock, $0.000041666 par value
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No x
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨ No x
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨
Indicate by check mark whether the registrant is a large accelerated filer, accelerated filer or non-accelerated filer (See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act) (Check one).
Large accelerated filer ¨ Accelerated filer x
Non-accelerated filer ¨ (do not check if a smaller reporting company) Smaller reporting company ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x
The aggregate market value of the registrant’s common stock, $0.000041666 par value per share, on June 30, 2011, the last business day of the registrant’s most recently completed second fiscal quarter, was approximately $110,195,585. As of March 27, 2012, there were 78,293,095 shares of the registrant’s common stock outstanding.
TABLE OF CONTENTS
“SAFE HARBOR” STATEMENT
Some of the information contained in this Annual Report may include forward-looking statements that reflect our current views with respect to our research and development activities, business strategy, business plan, financial performance and other future events. These statements include forward-looking statements both with respect to us, specifically, and the biotechnology sector, in general. Statements that include the words “expect,” “intend,” “plan,” “believe,” “project,” “estimate,” “may,” “should,” “anticipate,” “will” and similar statements of a future or forward-looking nature identify forward-looking statements for purposes of the federal securities laws or otherwise.
All forward-looking statements involve inherent risks and uncertainties, and there are or will be important factors that could cause actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to, those factors set forth in the sections entitled “Business,” “Risk Factors,” “Legal Proceedings,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Quantitative and Qualitative Disclosures About Market Risk” and “Controls and Procedures” in this Annual Report, all of which you should review carefully. Please consider our forward-looking statements in light of those risks as you read this Annual Report. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.
If one or more of these or other risks or uncertainties materializes, or if our underlying assumptions prove to be incorrect, actual results may vary materially from what we anticipate. All subsequent written and oral forward-looking statements attributable to us or individuals acting on our behalf are expressly qualified in their entirety by this Statement.
Item 1. Business
References in this Annual Report to “we,” “us,” “our” or the “company” refer to Genesis Biopharma, Inc., a Nevada corporation.
Overview
We are a biotechnology company focused on developing and commercializing adoptive cell therapy using autologous tumor infiltrating lymphocytes for the treatment of Stage IV metastatic melanoma and other cancers. Our lead product candidate, Cōntego™, is an adoptive cell therapy using autologous tumor infiltrating lymphocytes for the treatment of certain cancers.
Cancer cells possess multiple means of evading detection and destruction by the immune system. Such evasion occurs despite the fact that there are tumor associated antigens expressed on the surface of the cancer cells which are not expressed on the surface of normal cells. A variety of immunosuppressive influences can exist in the cancer patient including the presence of lymphocytes or myeloid cells with immunosuppressive activity.
Adoptive cell therapy (ACT) is a passive immunotherapy which attempts to optimize each patient’s unique immune response so that immune system operatives called anti-tumor T cells will circulate throughout the patient’s body, recognize the markers on the surface of cancer cells, and attack and kill those cancer cells. Our lead product candidate that we have named Contego™ is being developed as a ready-to-infuse ACT product comprised of a specific kind of anti-tumor T cell called autologous tumor-infiltrating lymphocytes (TILs). TILs migrate from the bloodstream and invade the tumor in an attempt to kill the tumor cells. We are developing Contego™ to treat patients suffering from metastatic melanoma, and ovarian, breast and colorectal cancers.
Cōntego™ is based on the adoptive cell therapy regimen using tumor infiltrating lymphocytes invented by Dr. Steven A. Rosenberg, Chief, Surgery Branch, Center for Cancer Research, National Cancer Institute for the treatment of metastatic melanoma. Dr. Rosenberg’s adoptive cell therapy is presently available as a physician-sponsored investigational therapy for the treatment of Stage IV metastatic melanoma at the National Cancer Institute, MD Anderson Cancer Center, and the H. Lee Moffitt Cancer & Research Institute. The current method of treatment is very labor intensive, which has limited its widespread application. We believe that a significant market opportunity exists if we can make the existing adoptive cell therapy more widely available to a larger number of cancer patients. There is no guarantee that Cōntego will prove to be a commercially successful therapy product.
We have licensed the rights to the adoptive cell therapy from the National Cancer Institute, and are presently developing a commercial-scale manufacturing process with Lonza Walkersville, Inc. for Contego as a prospective therapy for the treatment of Stage IV metastatic melanoma. Our goal is to develop and establish a manufacturing process for the large-scale production of TILs that is in accord with current Good Manufacturing Practices (“cGMP”). We do not plan to establish or operate our own manufacturing facility.
In order to effect our business plan, we have to date (i) acquired a worldwide, non-exclusive license for various adoptive cell therapy technologies from the National Institute of Health, (ii) entered into a Cooperative Research and Development Agreement with the National Cancer Institute (NCI), pursuant to which we intend to support the in vitro development of improved methods for the generation and selection of autologous TILs, develop approaches for large-scale production of autologous TILs that are in accord with cGMP procedures, and conduct clinical trials using these improved methods of generating TILs for the treatment of metastatic melanoma. We have also entered into a Manufacturing Services Agreement with Lonza Walkersville, Inc. pursuant to which Lonza has agreed to manufacture, package, ship and handle quality assurance and quality control of our Contego autologous cell therapy products.
Company History
We were incorporated in the State of Nevada on September 17, 2007. Until March 2010, we were known as Freight Management Corp., and we were engaged in the development of an internet-based, intelligent online system for business owners, freight forwarders in the shipping/freight industry and export/import industry. We never engaged in the online freight business, and were an inactive company until March 15, 2010.
On March 15, 2010, we acquired the rights, title and interest to certain assets, including certain patents, patent applications, materials, and know-how, related to the development and commercialization of biotechnology drugs, and then commenced developing anti-cancer drugs based primarily on anti-CD55+ antibody (the “Anti-CD55+ Antibody Program”). In order to further develop the assets we acquired, on March 15, 2010 we also entered into a Patent and Know How License (the “CRT License Agreement”) with Cancer Research Technology Limited, a company registered in England and Wales. The CRT License Agreement granted us an exclusive, worldwide right and license in certain intellectual property related to a proprietary, therapeutic use of anti-CD55+ antibodies, including rights to patents and patent applications related thereto. In order to develop our newly acquired technologies, on September 1, 2010, we entered into a research agreement with the University of Nottingham, England. Through this research agreement, we commenced preclinical research on a prospective therapeutic antibody (anti-CD55+ antibody) directed against expression of complement decay-accelerating factor CD55 protein which in humans is encoded by the CD55 gene. CD55 is a 70 kilodalton membrane protein that plays a role in the regulation of the complement system. CD55 protein is broadly expressed in malignant tumors, and is thought to play a role the promotion of tumorigenesis.
Although we initially believed that the proposed anti-CD55+ therapies that we were attempting to develop had significant commercial potential, test results received in mid-2011 from the studies performed for us by the University of Nottingham failed to meet the pre-clinical development endpoints. Accordingly, based on these test results and on a further evaluation of the anti-CD55+ technology, in October 2011, our Board of Directors determined that it was in the best interests of this company to (i) end our development efforts for the anti-CD55+ technology and to terminate the CRT License Agreement, and (ii) pursue the development of a new ready-to-infuse adoptive cell therapy product candidate we refer to as Contego™. Accordingly, we no longer are pursuing the Anti-CD55+ Antibody Program.
In February 2012 we agreed with the CRT that we would terminate the CRT License Agreement. The termination is subject to the execution of a formal termination agreement that will be prepared by the CRT. In connection with the termination of the CRT License Agreement, we will have to pay the CRT £18,000 (approx. U.S. $29,000) and return to the CRT all rights to the anti-CD55+ related patents and patent applications that were licensed and transferred to us by the CRT. We also need to pay Nottingham University £16,000 (approx. U.S. $25,000) as reimbursement for out-of-pocket Anti-CD55+ Antibody Program research-related expenses. Following our termination of the CRT License Agreement, we will no longer own, or have a license to use, the intellectual property necessary to develop therapeutic products based on the use of anti-CD55+ antibodies and our sole focus will be on Contego.
Technology and Proposed Products; Regulatory Strategy
Contego™ is being developed as a ready-to-infuse adoptive cell therapy product candidate comprised of a specific kind of anti-tumor T cell called autologous tumor-infiltrating lymphocytes (TILs) for the treatment of certain solid tumor cancers. TILs are white blood cells that have left the bloodstream and migrated into the tumor which are believed to kill the tumor cells.
Currently our focus is on the development and commercialization of Contego, our ACT therapy using TILs for the treatment of Stage IV metastatic melanoma. Our goal is to also develop our technology so that it can eventually be used to treat certain other solid tumor cancers such as triple negative breast/inflammatory breast duct, ovarian, and colorectal cancers.
Briefly, after the patient’s metastatic melanoma tumor has been surgically resected at the patient’s hospital, the tumor will then be sent to our manufacturing partner, Lonza Walkersville, Inc., at its facilities in Walkersville, Maryland USA. Using patent-protected and proprietary processes, autologous TILs having a high reactivity against the patient’s tumor-specific cell surface markers will then be isolated from the patient’s metastatic melanoma tumor. This population of autologous TILs is then multiplied ex vivo to greater than 50 billion TILs under conditions that overcome the immunosuppressive influences that exist in the cancer patient due to the presence of their cancer. Six to eight days prior to infusion of the TILs, the patient returns to the hospital and is administered a nonmyeloablative chemotherapeutic regimen to remove any lymphoid and myeloid suppressor cells present in the patient’s immune system. Once the TILs have been multiplied to a sufficient number ex vivo, and after the patient has completed the nonmyeloablative chemotherapeutic regimen, the TILs are infused into the patient along with a high dose of interleukin-2 (IL-2), a protein that stimulates the immune system.
Typically, the patient remains in the hospital for 8-10 days after the TIL infusion while their immune system rebuilds itself. Based on published results by the National Cancer Institute, the MD Anderson Cancer Center and at the Moffit Cancer Center, if planned confirmatory clinical trials reproduce results seen so far, we expect that for patients with metastatic melanoma who are refractory to all other treatments, about 50% of such patients according to RECIST criteria (“Response Evaluation Criteria in Solid Tumors” for clinical trials where diagnostic imaging such as a CAT scan is used to determine tumor presence, absence, shrinkage or growth) could experience an objective response showing significant tumor shrinkage following the ACT using autologous TILs. In addition, based on results from the same institutes, we also anticipate that a small percentage of patients could experience a complete response. Responses could also be durable lasting several years, and could be seen in all organ sites where metastasis is present, including in the brain. .
Our lead product candidate, Cōntego™, is an adoptive cell therapy using autologous tumor infiltrating lymphocytes indicated for the treatment of Stage IV metastatic melanoma. During 2012 and early 2013, we intend to work with our manufacturing partner, Lonza Walkersville to develop an FDA compliant manufacturing process for Contego. Our goal is to submit our investigational new drug application (IND) to the U.S. Food and Drug Administration (FDA) in late 2013 seeking allowance to proceed with a pivotal clinical trial for Cōntego for the treatment of Stage IV metastatic melanoma patients who are refractory to all FDA approved therapies for treatment of the disease. If the FDA approves our IND, we anticipate that we will commence a pivotal clinical trial for Contego in early 2014 for about 500 patients at approximately 20 trial centers. The clinical trials are expected to take at least 24 to 36 months to complete. We plan to seek accelerated approval from FDA under Subpart E of the Food Drug and Cosmetics Act for Contego as a second line therapy for the treatment of patients with Stage IV metastatic melanoma that are unresponsive to, or intolerant of, available therapies. Our goal is to obtain accelerated approval under Subpart E within four years. If such approval is granted by FDA, when being allowed to sell Contego in the USA, our approval will be conditioned upon us completing a confirmatory registration trial to remove the conditional approval status within an FDA mandated period of time post receipt of accelerated approval.
We also plan to investigate Cōntego as a prospective therapy for the treatment of persons with triple negative breast / inflammatory breast duct cancers, ovarian cancer, and colorectal cancer. We intend to undertake exploratory pilot clinical trials for these indications under sponsored research agreements with various medical and research institutions, including the institutions that are affiliated with members of our scientific and medical advisory board (see, Item 10 “Scientific & Medical Advisory Board” below). To date, we have not, however, entered into any such sponsored research agreements, and no assurance can be given if, or when such investigative clinical trials will begin.
Table 1: Genesis Biopharma Intended Product Pipeline
Market Opportunity
We are initially positioning Cōntego for the treatment of Stage IV metastatic melanoma, and ovarian, breast and colorectal cancers. The following table published by the American Cancer Society in 2011, lists the worldwide number of each of the foregoing cancers.
Table 2: Worldwide Number of Certain Cancer Cases
Based on our own internal estimates and the number of annual deaths for people with metastatic melanoma, we currently estimate approximately 6,000 –7,000 Stage IV metastatic melanoma patients could be candidates for Cōntego annually in the U.S. We also estimate that the number of Stage IV metastatic melanoma patients suitable for treatment using Contego outside the U.S. is approximately twice the size as in the U.S. We cannot, however, estimate how many of the patients that would be suitable for therapy using Contego, if and when Contego becomes available, will actually use Contego nor whether their disease status will change in meaningful way.
Summary of Intellectual Property
The intellectual properties that we licensed from the NIH under the License Agreement consist of T cell transfer technologies of which Dr. Steven A. Rosenberg is an inventor. Dr. Rosenberg is Chief of Surgery at the National Cancer Institute in Bethesda, Maryland and a Professor of Surgery at the Uniformed Services University of Health Sciences and at the George Washington University School of Medicine and Health Sciences in Washington, D.C. Dr. Rosenberg is a pioneer in the field of autologous cell therapy, and his recent studies of cell transfer therapies have resulted in cancer regressions in patients associated with the clonal repopulation of lymphocytes with anti-tumor reactivity. As described below, Dr. Rosenberg will be working with us under the CRADA to develop Contego.
The License Agreement licenses to us, on a non-exclusive basis, a total of 43 patent filings, both issued and pending. These 43 licensed filings include eight U.S. patents, one U.S. reissue patent, one European patent, three Australian patents, eight U.S. utility applications, five European applications, six Canadian applications, four Australian applications, three International applications filed under the provisions of the Patent Cooperation Treaty, and four U.S. provisional applications. In addition to the filings specifically identified in License Agreement, the licensed patent rights also include all divisions and continuations of these applications, all patents issuing from these applications, divisions and continuations, and any reissues, reexaminations and extensions of these patents.
The subject matter claimed in the patents and patent applications that were licensed by us under the License Agreement generally relates to:
Under the License Agreement, we are responsible for paying the patent maintenance costs. We currently estimate that annual maintenance cost for the current elements of the non-exclusively licensed portfolio will range from $50,000 to $100,000. The licensed issued U.S. patents will expire at various times between 2012 and, assuming that all maintenance fees are timely paid, 2026.
Our goal is to use the technologies that we licensed from the NIH, or that are expected to be developed under the CRADA, to further the development of our lead product candidate, Contego™.
Agreements Related To Intellectual Property
Cooperative Research And Development Agreement
On August 5, 2011, we entered into a Cooperative Research and Development Agreement (“CRADA”) with the National Institutes of Health and the National Cancer Institute (NCI). Under the terms of the five-year CRADA, Genesis Biopharma will work with Steven A. Rosenberg, M.D., Ph.D., chief of NCI’s Surgery Branch, to develop adoptive cell immunotherapies that are designed to destroy metastatic melanoma cells using a patient’s tumor infiltrating lymphocytes.