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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): October 1, 2005
SANGAMO BIOSCIENCES, INC.
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(Exact Name of Registrant as Specified in Its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
000-30171 68-0359556
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(Commission File Number) (IRS Employer Identification No.)
501 Canal Blvd, Suite A100 Richmond, California 94804
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(Address of Principal Executive Offices) (Zip Code)
(510) 970-6000
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(Registrant's Telephone Number, Including Area Code)
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
Effective as of October 1, 2005, Sangamo BioSciences, Inc. ("Sangamo"),
entered into a Research License and Commercial Option Agreement with Dow
AgroSciences LLC ("DAS"), a wholly owned indirect subsidiary of Dow Chemical
Corporation. Under this agreement, Sangamo will provide DAS with access to
Sangamo's proprietary zinc finger DNA-binding protein ("ZFP") technology and the
exclusive right to use Sangamo's ZFP technology to modify the genomes or alter
the nucleic acid or protein expression of plant cells, plants, or plant cell
cultures. Sangamo will retain all rights to use plants or plant-derived products
to deliver ZFP transcription factors or nucleases into human or animals for
diagnostic, therapeutic, or prophylactic purposes. The press release announcing
the transaction is attached as Exhibit 99.1 to this Current Report on Form 8-K
and is incorporated herein by reference.
Sangamo's agreement with DAS provides for an initial three-year
research term during which DAS and Sangamo will work together to validate and
optimize the application of Sangamo's ZFP technology to plants, plant cells and
plant cell cultures. A joint committee having equal representation from Sangamo
and DAS will oversee this research. During the initial three-year research term,
DAS will have the option to obtain a commercial license to sell products
incorporating or derived from plant cells generated using Sangamo's ZFP
technology, including agricultural crops, industrial products and plant-derived
biopharmaceuticals. This commercial license will be exclusive for all such
products other than animal and human health products. In the event that DAS
exercises this option, DAS may elect to extend the research program beyond the
initial three-year term on a year-to-year basis.
Pursuant to the Research License and Commercial Option Agreement, DAS
will make an initial cash payment to Sangamo of $7.5 million and will purchase
up to $4 million of Sangamo common stock in the next financing transaction
meeting certain criteria. In addition, DAS will provide between $4 and $6
million in research funding over the initial three-year research term and may
make up to an additional $4 million in research milestone payments to Sangamo
during this same period, depending on the success of the research program. In
the event that DAS elects to extend the research program beyond the initial
three-year term, DAS will provide additional research funding. If DAS exercises
its option to obtain a commercial license, Sangamo will be entitled to a
one-time exercise fee of $6 million as well as minimum annual payments totaling
up to $25.25 million, development and commercialization milestone payments for
each product, and royalties on sales of products. Furthermore, DAS will have the
right to sublicense Sangamo's ZFP technology to third parties for use in plant
cells, plants, or plant cell cultures, and Sangamo will be entitled to twenty
five percent (25%) of any cash consideration received by DAS under such
sublicenses.
Sangamo has agreed to supply DAS and its sublicensees with ZFP
transcription factors and/or nucleases for both research and commercial use. If
DAS exercises its option to obtain a commercial license, DAS may request that
Sangamo transfer, at DAS's expense, the ZFP manufacturing technology to DAS or
to a mutually agreed-upon contract manufacturer.
The Research License and Commercial Option Agreement will terminate
automatically if DAS fails to exercise its option for a commercial license by
end the initial three-year research term. DAS may also terminate the agreement
at the end of the second year of the initial research term if the joint
committee overseeing the research determines that disappointing research results
have made it unlikely that DAS will exercise the option; Sangamo is guaranteed
to receive $4 million in research funding from DAS prior to such a termination.
Following DAS's exercise of the option and payment of the exercise fee, DAS may
terminate the agreement at any time. In addition, each party may terminate the
agreement upon an uncured material breach of the other party. In the event of
any termination of the agreement, all rights to use Sangamo's ZFP technology
will revert to Sangamo, and DAS will no longer be permitted to practice
Sangamo's ZFP technology or to develop or, except in limited circumstances,
commercialize any products derived from Sangamo's ZFP technology.
The performance of the Research License and Commercial Option Agreement
and the benefits that may be derived by Sangamo from this agreement are subject
to many uncertainties and other factors. A description of some of the
uncertainties and other factors that could impact the Research License and
Commercial Option Agreement and Sangamo are set forth in Exhibit 99.2 to this
Current Report on Form 8-K, which is incorporated herein by reference.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits. The following documents are filed as exhibits to this report:
99.1 Press Release, dated October 5, 2005.
99.2 Uncertanties and Other Factors
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DATE: October 5, 2005
SANGAMO BIOSCIENCES, INC.
By: /s/ EDWARD O. LANPHIER II
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Edward O. Lanphier II
President, Chief Executive Officer
EXHIBIT 99.1
DOW AGROSCIENCES, SANGAMO BIOSCIENCES ANNOUNCE RESEARCH AND COMMERCIAL
LICENSE AGREEMENT IN PLANT AGRICULTURE
INDIANAPOLIS and RICHMOND, Calif., Oct. 5 /PRNewswire-FirstCall/ -- Dow
AgroSciences LLC, a wholly owned subsidiary of The Dow Chemical Company (NYSE:
DOW), and Sangamo BioSciences, Inc. (Nasdaq: SGMO) today announced the signing
of a Research and Commercial License Agreement. The agreement provides Dow
AgroSciences with access to Sangamo's proprietary zinc finger DNA-binding
protein (ZFP) technology for use in plants and plant cell cultures to develop
products in areas including, on an exclusive basis, plant agriculture and
industrial products, and, on a non-exclusive basis, animal health and
biopharmaceutical products produced in plants.
"Dow AgroSciences has a strong tradition of innovation and early adoption of
new technologies. We pride ourselves on operating at the cutting edge of plant
biotechnology in our mission to provide products that improve the quality and
quantity of the earth's food supply and contribute to improving the health and
quality of life of the world's growing population," said Dan Kittle, vice
president, Research and Development for Dow AgroSciences. "We believe that
access to Sangamo's ZFP technology will ensure an early and sustainable
competitive advantage for our business. We also look forward to working with the
public research sector and other companies to fully develop and apply this
technology to plant crop improvement."
"Dow AgroSciences is recognized as a world leader in innovative plant
biotechnology," said Edward Lanphier, Sangamo's president and chief executive
officer. "Sangamo has demonstrated that our ZFP technology provides a robust and
broadly applicable approach for both gene regulation and gene modification in a
wide range of organisms. Our business strategy has always been to maximize the
commercial potential of this technology across all fields of use. We believe
that the combination of our novel technology with Dow AgroSciences' proven
experience in development of agricultural biotech products will enable us to
accomplish this goal in plant agriculture. In Dow AgroSciences, we have a
partner that shares our vision and is capable of fully exploiting the
applications of ZFP transcription factors (ZFP TFs(TM)) and ZFP nucleases
(ZFNs(TM)) in plants."
ZFPs are the dominant class of naturally occurring transcription factors in
organisms from yeast to humans. Transcription factors, which are found in the
nucleus of every cell, bind to DNA to regulate gene expression. The ability to
selectively control specific genes is emerging as a critical tool in modern
biotechnology. Though there are many kinds of transcription factors, only ZFPs
are amenable to engineering and precise targeting to a particular gene or genes
of interest. By engineering ZFPs that recognize a specific DNA sequence Sangamo
scientists have created ZFP TFs(TM) that can control gene expression and
consequently, cell function. For example, Sangamo has demonstrated that plant
oils can be improved using ZFP TFs(TM).
Sangamo has also developed sequence-specific ZFNs(TM) for precision gene
modification and targeted gene insertion. These technologies have the potential
to play a major role in bringing new discoveries in genomics forward to the
marketplace. According to a 2004 International Service for the Acquisition of
Agri-biotech Applications (ISAAA) report, transgenic traits were planted on an
estimated 200 million acres, or 29 percent of the global acres for soybean,
cotton, maize, and canola. Phillips McDougall, international crop protection and
agricultural biotechnology consultants, estimates the value of agricultural
biotechnology in these crops for 2004 to be $4.7 billion. Both the acreage and
the value of agricultural biotechnology are expected to grow. This increasing
demand could be addressed by the use of Sangamo's ZFN and ZFP technologies for
combinations or stacks of multiple traits and new traits. Investments globally
in genomics are also revealing large numbers of genes with the potential to
substantially improve crop quality, expand crop uses and improve agronomic
performance.
About Dow AgroSciences, LLC
Dow AgroSciences LLC, based in Indianapolis, Indiana, USA, is a global
leader in providing pest management, biotechnology and crop products that
improve the quality and quantity of the earth's food supply and contribute to
improving the health and quality of life of the world's growing population. Dow
AgroSciences has approximately 5,500 people in more than 50 countries dedicated
to its business, and has worldwide sales of US $3.4 billion. Dow AgroSciences is
a wholly owned subsidiary of The Dow Chemical Company. For more information
about Dow AgroSciences, visit www.dowagro.com.
About Sangamo
Sangamo BioSciences, Inc. is focused on the research and development of
novel DNA-binding proteins for therapeutic gene regulation and modification. The
most advanced ZFP Therapeutic(TM) development programs are currently in Phase I
clinical trials for evaluation of safety in patients with diabetic neuropathy
and peripheral artery disease. Other therapeutic development programs are
focused on macular degeneration, ischemic heart disease, congestive heart
failure, neuropathic pain, and infectious and monogenic diseases. Sangamo's core
competencies enable the engineering of a class of DNA-binding proteins known as
zinc finger DNA-binding proteins (ZFPs). By engineering ZFPs that recognize a
specific DNA sequence Sangamo has created ZFP transcription factors (ZFP TF(TM))
that can control gene expression and, consequently, cell function. Sangamo is
also developing sequence-specific ZFP Nucleases (ZFN(TM)) for therapeutic gene
modification as a treatment for a variety of monogenic diseases, such as sickle
cell anemia, and for infectious diseases, such as HIV. For more information
about Sangamo, visit the company's web site at www.sangamo.com.
This press release may contain forward-looking statements based on Dow
AgroSciences LLC and Sangamo BioSciences, Inc.'s current expectations. These
forward-looking statements include, without limitation, references to the
research and development of novel ZFP TFs and ZFNs and applications of Sangamo's
ZFP technology platform. Actual results may differ materially from these
forward-looking statements due to a number of factors, including technological
challenges, Dow AgroSciences ability to develop commercially viable products and
technological developments by our competitors. See the company's SEC filings,
and in particular, the risk factors described in the company's Annual Report on
Form 10-K and its most recent 10-Q. Dow AgroSciences and Sangamo BioSciences,
Inc. assume no obligation to update the forward-looking information contained in
this press release.
SOURCE Sangamo BioSciences, Inc.
-0- 10/05/2005
/CONTACT: Elizabeth Wolffe, Ph.D of Sangamo BioSciences, Inc.,
+1-510-970-6000, ext. 271, or ewolffe@sangamo.com; or media, Justin Jackson,
+1-212-213-0006, or investors, John Cummings, +1-415-352-6262, both of Burns
McClellan, Inc., for Sangamo; or Robyn Heine, +1-317-337-4807, or
rheine@dow.com, for Dow AgroSciences/
/FCMN Contact: ewolffe@sangamo.com /
/Web site: http://www.dowagro.com/
/Web site: http://www.sangamo.com/
(SGMO DOW)
EXHIBIT 99.2
UNCERTAINTIES RELATING TO THE PERFORMANCE OF THE RESEARCH LICENSE AND COMMERCIAL
OPTION AGREEMENT MAY CAUSE THE BENEFITS UNDER THIS AGREEMENT TO BE LIMITED.
The Research License and Commercial Option Agreement between Sangamo
BioSciences, Inc. ("Sangamo") and Dow AgroSciences LLC ("DAS") agreement
provides for an initial phase in which DAS and Sangamo will work together to
validate and optimize the application of Sangamo's zinc finger DNA-binding
protein (ZFP) technology to plants, plant cells and plant cell cultures. Sangamo
can not be certain that DAS and Sangamo will succeed with the development of the
necessary technology for the application of the ZFP technology to plants, plant
cells and plant cell cultures or with the development of commercially viable
products in these fields of use. To the extent Sangamo and DAS do not succeed in
developing the necessary technology and commercializing products or if DAS
elects not to exercise its option for a commercial license regardless of
development achievements, Sangamo's revenue under this agreement will be
limited.
This agreement will terminate after 3 years if DAS fails to exercise its option
for a commercial license. In addition, it may terminate after only two years if
the joint committee determines that disappointing research results make it
unlikely for DAS to exercise its commercial license option. The initial cash
payment of $7.5 million, $4.0 million purchase of Sangamo's common stock and
$4.0 million in research funding are the only payment obligations under this
agreement not subject to achievement of milestones or actions at the sole
discretion of DAS.