July 2013, Array BioPharma (ARRY) entered into a Drug Discovery Collaboration Agreement with Loxo Oncology (LOXO) @LoxoOncology, and granted Loxo exclusive rights to develop and commercialize certain Array invented compounds targeted at the tropomyosin kinase (“Trk”) family of receptors, including LOXO-101.

In April 2014 and again in April 2015, Array and Loxo amended the agreement to expand the research activities under the agreement. Under the terms of the amended agreement, Loxo will fund further preclinical research to be conducted by Array during the remainder of the three year discovery research phase, which may be extended by Loxo for up to two additional one year renewal periods.

Loxo will fund further discovery and preclinical research to be conducted by Array directed at other targets during the research phase of the agreement. Loxo will be responsible for all additional preclinical and clinical development and commercialization.

Upfront Payment

Array received shares of Loxo nonvoting preferred stock representing an initial 19.9% interest in the newly formed entity. Following additional financings by Loxo, Array’s ownership interest in Loxo as of June 30, 2014 was 15.3%. All of the shares of preferred stock held by Array converted into shares of common stock on the closing date of Loxo’s IPO. After certain trading restrictions ended following Loxo’s IPO, all shares were sold and as of June 30, 2015, Array has no remaining ownership interest in Loxo.

  • Array receives advance payments for preclinical research and other services that Array is providing during the term of the discovery program.

Commercial 

  • Up to $435MM if certain clinical, regulatory and sales milestones are achieved
  • Royalties on sales of any resulting drugs

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