Kite Pharmaceuticals, Inc.
Jan 9, 2017

Kite Pharma Establishes a Strategic Partnership With Daiichi Sankyo to Develop and Commercialize Axicabtagene Ciloleucel (KTE-C19) in Japan

SANTA MONICA, Calif.--(BUSINESS WIRE)-- Kite Pharma (Nasdaq:KITE) announced today that it has entered into a strategic partnership with Daiichi Sankyo Co., Ltd. (Daiichi Sankyo) for axicabtagene ciloleucel (approved USAN for KTE-C19) in Japan. Axicabtagene ciloleucel, Kite's lead product candidate, is an investigational therapy in which a patient's T cells are engineered to express a chimeric antigen receptor (CAR) to target the antigen CD19, a protein expressed on the cell surface of B-cell lymphomas and leukemias, and redirect the T cells to kill cancer cells.

Under the terms of the partnership agreement, Daiichi Sankyo will be responsible for development and commercialization of axicabtagene ciloleucel in Japan. Daiichi Sankyo will make an upfront payment to Kite of $50 million and Kite will be eligible to receive future payments totaling up to $200 million for development and commercial milestones. Kite is also entitled to receive sales royalties in the low to mid double digit range.

"We are thrilled to partner with Daiichi Sankyo, a market leader in Japan who shares our vision for engineered T-cell therapy and has strong development capabilities in oncology," said Arie Belldegrun, M.D., FACS, Chairman, President, and Chief Executive Officer of Kite. "We have a strategic roadmap to commercialize axicabtagene ciloleucel globally while focusing Kite's development and commercialization efforts in the United States and Europe. Daiichi Sankyo's commitment to bring autologous T-cell therapy to patients in Japan will complement our strategy and demonstrates the significant value in our pipeline, as well as the commercial potential for autologous T-cell therapy globally."

As part of the transaction, Kite will provide certain technical transfer services to Daiichi Sankyo. In addition, Daiichi Sankyo has a certain period of time to license additional Kite product candidates for Japan including KITE-718, Kite's T cell receptor product candidate targeting MAGE-A3/A6 and certain other product candidates that proceed to a U.S. investigational new drug application filing over the next three years. Upfront and milestone payments for each additional product candidate could equal up to $200 million plus low to mid double digit sales royalties. Kite retains all development and commercialization rights outside of Japan.

"We are very enthusiastic about this partnership with Kite which has the most advanced technology platform in this area and the potential for cell-based therapy to change the way in which we treat cancer in Japan," said Koichi Akahane, Japan Head of Oncology R&D, Daiichi Sankyo. "We believe we can leverage the pioneering research conducted by Kite to potentially accelerate development and commercial availability of axicabtagene ciloleucel in Japan for those patients suffering from B-cell malignancies."

Japan, the third-largest pharmaceutical market in the world, has implemented an accelerated approval pathway for regenerative medicine and cell therapy products under the Pharmaceuticals and Medical Devices Act (PMD Act) in November 2014. There are approximately 9,300 new cases of aggressive NHL and 1,400 new cases of acute lymphoblastic leukemia (ALL) diagnosed per year in Japan, with similar treatment rates and prescribing patterns as the United States and Europe.1

Kite announced in December 2016 that it has initiated the rolling submission to the U.S. Food and Drug Administration (FDA) of the Biologics License Application (BLA) for KTE-C19 as a treatment for patients with refractory aggressive non-Hodgkin lymphoma (NHL).

About axicabtagene ciloleucel

Kite Pharma's lead product candidate, axicabtagene ciloleucel, is an investigational therapy in which a patient's T cells are engineered to express a chimeric antigen receptor (CAR) to target the antigen CD19, a protein expressed on the cell surface of B-cell lymphomas and leukemias, and redirect the T cells to kill cancer cells. Axicabtagene ciloleucel has been granted Breakthrough Therapy Designation status for diffuse large B-cell lymphoma (DLBCL), transformed follicular lymphoma (TFL), and primary mediastinal B-cell lymphoma (PMBCL) by theĀ U.S. Food and Drug Administration (FDA) and Priority Medicines (PRIME) regulatory support for DLBCL in the EU.

AboutĀ Daiichi Sankyo

Daiichi Sankyo Group is dedicated to the creation and supply of innovative pharmaceutical products to address diversified, unmet medical needs of patients in both mature and emerging markets. With over 100 years of scientific expertise and a presence in more than 20 countries, Daiichi Sankyo and its 16,000 employees around the world draw upon a rich legacy of innovation and a robust pipeline of promising new medicines to help people. In addition to a strong portfolio of medicines for hypertension and thrombotic disorders, under the Group's 2025 Vision to become a "Global Pharma Innovator with Competitive Advantage in Oncology," Daiichi Sankyo research and development is primarily focused on bringing forth novel therapies in oncology, including immuno-oncology, with additional focus on new horizon areas, such as pain management, neurodegenerative diseases, heart and kidney diseases, and other rare diseases. For more information, please visit: www.daiichisankyo.com. Daiichi Sankyo, Inc., headquartered in Parsippany, New Jersey, is a member of the Daiichi Sankyo Group. For more information on Daiichi Sankyo, Inc., please visit: www.dsi.com.

About Kite Pharma

Kite Pharma, Inc., is a clinical-stage biopharmaceutical company engaged in the development of novel cancer immunotherapy products, with a primary focus on engineered autologous cell therapy (eACT™) designed to restore the immune system's ability to recognize and eradicate tumors. Kite is based in Santa Monica, CA. For more information on Kite Pharma, please visit www.kitepharma.com. Sign up to follow @KitePharma on Twitter at http://www.twitter.com/kitepharma.

Cautionary Note on Forward-Looking Statements

This press release contains forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The press release may, in some cases, use terms such as "predicts," "believes," "potential," "proposed," "continue," "estimates," "anticipates," "expects," "plans," "intends," "may," "could," "might," "will," "should" or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Forward-looking statements include statements regarding intentions, beliefs, projections, outlook, analyses or current expectations concerning, among other things: the ability of Daiichi Sankyo to develop and commercialize axicabtagene ciloleucel in Japan and of Kite to develop and commercialize axicabtagene ciloleucel in the United States, Europe and other territories; and the expectations regarding the clinical effectiveness and safety of T-cell therapies. Various factors may cause differences between Kite's expectations and actual results as discussed in greater detail in Kite's filings with the Securities and Exchange Commission, including without limitation in its Form 10-Q for the quarter ended September 30, 2016. Any forward-looking statements that are made in this press release speak only as of the date of this press release. Kite assumes no obligation to update the forward-looking statements whether as a result of new information, future events or otherwise, after the date of this press release.

1 IMS Health, Pharmaceutical and Medical Devices Agency (PMDA) website, Decision Resources Group and Kite estimates.

Kite Pharma
Christine Cassiano
SVP, Corporate Communications & Investor Relations
ccassiano@kitepharma.com
or
Greg Mann
VP, Investor Relations
gmann@kitepharma.com

Source: Kite Pharma, Inc.

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