Equillium and Ono Pharmaceutical Announce Exclusive Option and Asset Purchase Agreement for the Development and Commercialization of Itolizumab

Equillium, Inc. (Nasdaq: EQ), a clinical-stage biotechnology company focused on developing novel therapeutics to treat severe autoimmune and inflammatory disorders, and Ono Pharmaceutical Co., Ltd. (“Ono”), today announced an option and asset purchase agreement through which Ono gains the exclusive option to purchase Equillium’s rights to itolizumab, a first-in-class monoclonal antibody targeting CD6. These rights include all therapeutic indications and the rights to commercialize itolizumab in the United States, Canada, Australia, and New Zealand.

“We are very pleased to partner itolizumab with Ono, a leading Japanese pharmaceutical company dedicated to fighting disease and pain,” said Bruce Steel, Chief Executive Officer at Equillium. “This strategic partnership validates the potential of itolizumab to address autoimmune and immuno-inflammatory disorders for patients in significant need of new therapies. Through this partnership, we have secured the resources necessary to continue advancing our Phase 3 EQUATOR study of itolizumab in the treatment of first-line acute graft-versus-host disease, a severe life-threatening disease, and our ongoing EQUALISE study in lupus nephritis. Based on our current operating plan, we expect this strategic partnership will enable us to fund operations into 2025, enabling us to advance our wholly-owned pipeline of multi-cytokine inhibitors through multiple key milestones, including our ongoing Phase 2 study of EQ101 in alopecia areata and Phase 1 study of EQ102 in celiac disease.”

“We believe this collaboration with Equillium reinforces our commitment to research and development and creating innovative therapeutics in immunology,” said Gyo Sagara, President and Chief Executive Officer of Ono. “We are very pleased to be partnering with Equillium to develop a novel medicine for patients with difficult-to-treat immuno-inflammatory disorders. We hope that itolizumab will serve as our foundation for expanding our business in the United States and pave the way for becoming a global specialty pharmaceutical company.”

Under the terms of the agreement, Equillium will receive a non-refundable upfront payment of approximately $26.0 million (¥3.5 billion) and will also be eligible to receive up to an aggregate of approximately $138.5 million (¥18.7 billion) for exercise of the option and milestone payments from development through first commercial sale. Equillium will be responsible for the conduct of all research and development of itolizumab, which will be fully funded by Ono on a quarterly basis commencing July 1, 2022 through the option period.¹ The option period will expire three months following delivery of topline data from the EQUALISE study in lupus nephritis and interim data from the EQUATOR Phase 3 study in acute GVHD.