CancerVax Corp. Receives OFAC License to Enter Into Transactions With Cuban Biotech Company
The Treasury Department's Office of Foreign Assets Control (OFAC) last week issued a highly unusual specific license that grants CancerVax Corp., a California biotechnology company, the authority to complete the clinical development of three experimental cancer drugs that were developed in Cuba.
The license issued by OFAC authorizes CancerVax and its wholly owned subsidiaries, Tarcanta, Inc., and Tarcanta, Ltd. (Ireland), to enter into the transactions with CIMAB, S.A., a Cuban biotechnology company, and YM BioSciences Inc., a Canadian company, relating to three drugs that target epidermal growth factor, a protein associated with the growth and spread of tumors in a range of cancers, including lung, breast and colon cancer.
Under the agreements with CIMAB and YM BioSciences, CancerVax will provide upfront access fees, technology transfer fees, development and commercialization milestones and royalties upon commercial sales. CancerVax is obligated to make access and technology transfer payments of approximately $6 million over the next three years. If the three products are approved for commercial sales in the U.S., Europe and Japan, CancerVax must pay additional milestone payments, up to a maximum of approximately $35 million, based upon meeting specified regulatory, clinical and commercialization milestones, and royalties on future net sales of product. Under the terms of the OFAC license, all of the milestone and other payments owed to CIMAB will be made in U.S.-origin food, medicines and/or medical supplies for the public health purposes of the Cuban people.
CancerVax is the first U.S.-based company to receive this type of license from the U.S. Government. David F. Hale, President and CEO of CancerVax, indicated that his company had been working with OFAC and the State Department on this transaction for more thatn two years. He also mentioned that CancerVax's efforts to obtain approval to enter into this transaction received bipartisan support in the U.S. Congress.