425: TuHURA Biosciences Enters Exclusivity Agreement with Kineta for Anti-VISTA Checkpoint Inhibitor KVA12123

TuHURA Biosciences secures an exclusive right to acquire Kineta's KVA12123, a novel anti-VISTA checkpoint inhibitor, for a potential $5 million deal.

Summary

• TuHURA Biosciences has entered into an Exclusivity and Right of First Offer Agreement with Kineta for the potential acquisition of Kineta's KVA12123 anti-VISTA antibody.
• KVA12123 is a checkpoint inhibitor designed to reverse VISTA immune suppression and remodel the tumor microenvironment.
• TuHURA will pay Kineta $5.0 million, with $2.5 million paid at signing and an additional $2.5 million due by July 15, 2024.
• TuHURA has an exclusive right to acquire Kinetas worldwide patents, patent rights, patent applications, product and development program assets, technical and business information, and other rights and assets associated with and derived from its development program related to KVA12123.
• The exclusivity period lasts until October 1, 2024, with a potential extension of up to 20 days.
• TuHURA sold $5.0 million of its common stock in a private offering to an existing shareholder to fund the agreement.
• KVA12123 has completed two clinical trials as a monotherapy and in combination with Merck's KEYTRUDA in patients with advanced solid tumors.
• TuHURA and Kintara previously announced a merger agreement, expected to close in the third quarter of 2024, under the name TuHURA Biosciences, Inc. and trade on the Nasdaq Capital Market under the ticker HURA.
• The merger is subject to customary closing conditions, including stockholder approval.

Sentiment

Score: 7

Explanation: The sentiment is positive due to the potential acquisition of a promising asset and the strengthening of TuHURA's pipeline. However, there are risks associated with the deal and the pending merger, which temper the overall sentiment.

Positives

• TuHURA gains exclusive rights to a promising anti-VISTA checkpoint inhibitor, KVA12123, which could enhance its oncology pipeline.
• KVA12123 has shown a favorable safety profile in clinical trials.
• The $5.0 million private placement strengthens TuHURA's balance sheet.
• The acquisition of KVA12123 has multiple synergies with both of our IFx and Delta receptor technologies and could be a promising addition to our pipeline, bringing in a potential Phase 2 ready, novel checkpoint inhibitor.
• KVA12123 focuses on VISTA, which is the only known checkpoint on quiescent T-cells preventing their activation and represents a promising new target in cancer immunotherapy.

Negatives

• The acquisition is contingent on TuHURA and Kineta entering into a definitive agreement.
• The merger between TuHURA and Kintara is subject to customary closing conditions, including stockholder approval, which introduces uncertainty.
• TuHURA is paying $5 million for an option on the asset, which may not result in a completed acquisition.

Risks

• The failure to reach a definitive agreement with Kineta could result in TuHURA losing the $2.5 million initial payment.
• The merger with Kintara may not close, impacting the combined company's strategy and resources.
• Clinical trials for KVA12123 may not yield positive results, affecting its potential value.
• The combined company's capital resources may not be sufficient to fund its operations.
• The risk that Kineta and TuHURA do not enter into a definitive agreement for a strategic transaction.

Future Outlook

The combined company will focus on advancing TuHURA's personalized cancer vaccine(s) and first-in-class bi-functional ADCs, two technologies that seek to overcome the major obstacles that limit the effectiveness of current immunotherapies in treating cancer.

Management Comments

• Dr. James Bianco, Chief Executive Officer of TuHURA, commented that KVA12123 has multiple synergies with both of our IFx and Delta receptor technologies and could be a promising addition to our pipeline, bringing in a potential Phase 2 ready, novel checkpoint inhibitor.
• Craig W. Philips, President of Kineta, stated that TuHURA is well positioned to advance KVA12123 and believes they will make an excellent partner for this program.

Industry Context

This announcement reflects the ongoing interest in VISTA as a target for cancer immunotherapy, with companies seeking to develop novel checkpoint inhibitors to overcome resistance to existing therapies. The acquisition of KVA12123 could position TuHURA as a key player in this emerging field.

Comparison to Industry Standards

• The development of VISTA inhibitors is an area of active research, with companies like Jounce Therapeutics and Compugen also pursuing this target.
• KVA12123's favorable safety profile, with no evidence of cytokine release syndrome, differentiates it from some other VISTA-targeting therapies.
• Merck's KEYTRUDA (pembrolizumab) is a leading anti-PD1 therapy, and KVA12123 has been studied in combination with it, suggesting potential synergies.

Stakeholder Impact

• Shareholders of TuHURA and Kintara may be impacted by the potential acquisition and the pending merger.
• Patients with advanced solid tumors may benefit from the development of KVA12123 as a new treatment option.
• Employees of TuHURA, Kintara, and Kineta may be affected by the acquisition and merger.

Next Steps

• TuHURA to pay the remaining $2.5 million to Kineta by July 15, 2024.
• TuHURA and Kineta to negotiate and potentially enter into a definitive agreement for the acquisition of KVA12123.
• Kintara and TuHURA to obtain stockholder approval for the proposed merger.
• Kintara and TuHURA to close the merger in the third quarter of 2024.

Key Dates