CALDERWOOD & HARKNESS LLP 1120 Avenue of the Americas, 32nd Floor New York, New York 10036
December 6, 2022
VIA EMAIL
Lisa Moritani, Esq. General Counsel & Corporate Secretary Penterra Pharmaceuticals Corp. 900 Commons Way, Suite 400 Dralvecen, NJ 08807
Re: Matter No. 1018-00005 — Confirmation of Engagement Dormancy Supplemental New Drug Application — Velonatib (NDA No. 215-847) — Chronic Plaque Psoriasis Indication
Dear Lisa:
This letter confirms our receipt and acknowledgment of your email dated December 1, 2022, in which you instructed Calderwood & Harkness LLP (the "Firm") to place the Velonatib chronic plaque psoriasis supplemental New Drug Application ("sNDA") labeling supplement engagement on dormant status, effective December 1, 2022. This engagement is tracked internally under Matter No. 1018-00005. The Firm's Healthcare & Life Sciences team has carefully reviewed your dormancy instruction and is pleased to confirm the following arrangements regarding the cessation of active work, preservation of the engagement file, financial reconciliation, and the procedures that will govern any future reactivation of the matter.
1. Cessation of Work
All work on Matter No. 1018-00005 has ceased as of December 1, 2022. No further billable activity will be undertaken by any member of the engagement team on the draft United States Prescribing Information ("USPI"), the Medication Guide, the Risk Evaluation and Mitigation Strategy ("REMS") assessment section, or any other sNDA-related work product unless and until Penterra Pharmaceuticals Corp. ("Penterra" or the "Company") provides written instructions to reactivate the engagement in accordance with the reactivation procedures described in Section 4 below.
Accordingly, no invoices will be submitted to Penterra during the dormancy period unless the Company separately requests specific services and provides prior written authorization for such services. This ensures that no fees or disbursements will accrue on this matter without Penterra's express knowledge and consent.
For the record, we note that the most recent active work product generated under this engagement included the following:
• Draft USPI — Psoriasis Indication, Rev. 3, dated October 15, 2022; and
• Draft Medication Guide Update, Rev. 2, dated October 20, 2022.
Both of these deliverables were placed on formal hold on November 22, 2022, following the release of the CLARION-3 top-line results and Penterra's subsequent decision to reassess the regulatory strategy for the psoriasis indication. No substantive revisions have been made to either document since that date.
2. File Preservation
All work product, correspondence, memoranda, and files generated during the active phase of the engagement — spanning from July 7 through November 30, 2022 — have been preserved in both physical and electronic form. These files will be maintained in accordance with Calderwood & Harkness's standard document retention policies as well as any specific instructions provided by Penterra. The engagement file remains available for retrieval and review at any time upon Penterra's request.
The key preserved documents comprising the engagement file include, but are not limited to, the following:
• Executed Engagement Letter, dated July 7, 2022
• Regulatory Strategy Memorandum, dated August 12, 2022
• Pediatric Study Deferral Analysis Memorandum, dated September 8, 2022
• REMS Assessment Memorandum, dated September 22, 2022
• Draft USPI — Psoriasis Indication, Rev. 3, dated October 15, 2022 — DRAFT, ON HOLD
• Draft Medication Guide Update, Rev. 2, dated October 20, 2022 — DRAFT, ON HOLD
• Correspondence with patent counsel (Whitfield & Grange LLP) regarding labeling language and Orange Book listing considerations, dated October 3, 2022
• Post-CLARION-3 Regulatory Path Analysis Memorandum, dated November 28, 2022
• FDA Type B Meeting Briefing Document (Calderwood & Harkness review comments), dated April 18, 2022
• FDA Type B Meeting Minutes (Calderwood & Harkness annotated version), dated May 19, 2022
• All related internal emails, working drafts, research memoranda, and supporting materials generated during the active phase
Should Penterra wish to receive copies of any of the foregoing documents at any time during the dormancy period, we will promptly provide them upon request. We also note that Penterra's own copies of shared work product, including joint working drafts circulated to the Penterra regulatory affairs team, remain the Company's property regardless of the dormancy status of this engagement.
3. Financial Reconciliation
We are pleased to confirm that all financial obligations arising from the active period of the engagement have been fully satisfied. There are no outstanding balances, unbilled amounts, or unresolved disbursements. A summary of the financial reconciliation for the engagement through the date of dormancy is set forth below:
For reference, the billing rates in effect during the active period of the engagement were $1,175 per hour for partners and $725 per hour for associates, as set forth in the executed engagement letter dated July 7, 2022. These rates applied to all timekeepers who recorded time to the matter during the active phase.
We also note for completeness that the original fee estimate for the full scope of the engagement — encompassing all regulatory counsel services through submission of the sNDA to the U.S. Food and Drug Administration ("FDA") — was in the range of $475,000 to $625,000. As a result of the dormancy, the engagement was placed on hold before that full scope of work was completed. The fees invoiced and collected to date represent work performed through the active phase only, and any remaining scope will be addressed upon reactivation, at which point an updated fee estimate will be provided reflecting the remaining deliverables, any change in scope, and then-current billing rates.
4. Reactivation Procedures
When Penterra wishes to reactivate the engagement, we ask that the Company provide written notice to the undersigned or to Joel Strauss, the responsible partner on the matter. We understand that Penterra currently anticipates that reactivation may occur upon the availability of top-line data from the redesigned CLARION-3R study, which is projected for the second half of 2024. We recognize, of course, that this timeline may shift based on clinical enrollment and other factors, and we will look to Penterra for updates as described in Section 6 below.
Upon receipt of a written reactivation notice from Penterra, Calderwood & Harkness will undertake the following steps to ensure an orderly and effective resumption of work:
1. Staffing Confirmation. Joel Strauss, the responsible partner on this matter, will confirm the availability of the engagement team and identify any necessary adjustments to the staffing plan. The team as constituted during the active phase comprised: Joel Strauss (responsible partner), Miriam Calloway (billing partner), Sean Morrissey (lead associate), and Christopher Aiken (working associate). In the event that any member of the team is unavailable at the time of reactivation due to other commitments, departures, or other circumstances, we will promptly identify qualified replacements and notify Penterra of any proposed staffing changes for the Company's review and approval.
2. Conflicts Check. A full conflicts review will be re-run in accordance with Firm policy to ensure that no new conflicts of interest have arisen during the dormancy period that would affect our ability to represent Penterra on this matter. We will promptly notify Penterra of the results of this review and, in the unlikely event a conflict is identified, work with the Company to determine whether appropriate waivers or other measures can be implemented.
3. Rate Confirmation. Any adjustments to the Firm's billing rates that have taken effect during the dormancy period will be communicated to Penterra and confirmed in writing before work resumes. If the scope of services has materially changed — for example, due to new clinical data, changes in the regulatory pathway, or the addition of new deliverables — updated engagement terms will be documented in an amendment to the engagement letter or a new engagement letter, as appropriate.
4. Regulatory-Landscape Update Memorandum. Upon reactivation, the engagement team will prepare a comprehensive status memorandum for Penterra identifying all material regulatory developments that occurred during the dormancy period. This memorandum will address, at a minimum, the following areas: (a) FDA guidance documents affecting Janus kinase ("JAK") inhibitors, including any updates to the boxed warning framework or post-marketing requirements applicable to this drug class; (b) class-wide labeling updates or safety communications issued by the FDA with respect to JAK inhibitors; (c) competitor approvals, supplemental approvals, or labeling changes in the chronic plaque psoriasis therapeutic area; (d) any changes to the sNDA regulatory pathway, including revisions to FDA review procedures, content and format requirements, or electronic submission standards; and (e) any relevant updates to Prescription Drug User Fee Act ("PDUFA") procedures, timelines, or user fee schedules. This memorandum will serve as the foundation for updating the regulatory strategy and work product to reflect the current landscape.
5. Work-Product Review. All preserved drafts — including the USPI Rev. 3, the Medication Guide Rev. 2, and the REMS assessment analysis — will be retrieved from the engagement file and reviewed in detail by the engagement team. The team will assess each deliverable for necessary updates in light of the CLARION-3R data, any intervening regulatory changes identified in the regulatory-landscape update memorandum, and any additional guidance or direction received from Penterra's regulatory affairs team. We will provide Penterra with a written summary of recommended revisions and a proposed timeline for completing the remaining scope of work.
We recommend that Penterra provide advance notice of the anticipated reactivation — ideally several weeks before the expected CLARION-3R data readout — to allow sufficient ramp-up time for the engagement team to complete the staffing confirmation, conflicts review, and initial regulatory-landscape assessment before the data become available. This lead time will enable the team to move quickly once top-line results are in hand and the Company is prepared to advance the sNDA strategy.
5. Continued Availability During Dormancy
Although the matter is dormant and no active billable work will be performed, Joel Strauss and the Healthcare & Life Sciences team at Calderwood & Harkness remain available to respond to discrete questions or provide limited guidance that may arise during the interim period. We recognize that the regulatory and competitive landscape for JAK inhibitors in psoriasis continues to evolve, and that circumstances may arise in which Penterra would benefit from brief consultation with outside regulatory counsel even while the sNDA engagement is on hold.
By way of example, such inquiries could include questions about FDA communications or correspondence received by Penterra relating to the Velonatib NDA or the psoriasis indication, developments in JAK-inhibitor regulatory policy (such as new FDA-mandated labeling changes or safety-related actions), or coordination points with Whitfield & Grange LLP (patent counsel) or Callendar Baines Group LLC (regulatory consultancy) on matters touching the sNDA or labeling supplement. We are happy to assist with such matters on an ad hoc basis, understanding that any such services would be billed at the then-current rates and only with Penterra's prior written approval before any work is commenced.
6. Annual Dormancy Review
Pursuant to Calderwood & Harkness's firm policy, dormant matters are subject to annual review to ensure that the Firm's records remain current and that client expectations regarding the status of inactive matters are regularly confirmed. This matter will be reviewed on or before December 1, 2023, and annually thereafter for so long as it remains in dormant status.
If the Firm does not hear from Penterra by December 2023 regarding the status of the engagement, we will reach out proactively to confirm whether the matter should remain dormant, be reactivated, or be formally closed in accordance with the Firm's file closure procedures. We respectfully request that Penterra notify Calderwood & Harkness of any material developments in the CLARION-3R clinical program, any changes to the anticipated reactivation timeline, or any other circumstances that may affect the status of this engagement, so that we may plan accordingly and ensure that we are fully prepared to support the Company when the time comes.
7. Scope Limitation
For the avoidance of doubt, the dormancy confirmed in this letter relates solely to the chronic plaque psoriasis sNDA labeling supplement engagement under Matter No. 1018-00005. It does not affect, modify, or otherwise alter the terms of any other engagement, if any, between Penterra Pharmaceuticals Corp. (or any of its affiliates or subsidiaries) and Calderwood & Harkness LLP.
On behalf of the entire engagement team, we wish to express our sincere appreciation for the opportunity to work with Penterra and your outstanding regulatory affairs team — including Dr. Karen Hessler, Dr. Tomás Becerra, and Janet Ling — on this matter. The collaboration during the active phase of the engagement was productive and thoroughly professional, and we are grateful for the confidence Penterra has placed in the Firm.
We continue to believe that the clinical program for Velonatib in chronic plaque psoriasis provides a solid foundation for the sNDA. The CLARION-2 results — including a PASI-75 response rate at Week 16 of 71.5% compared to 9.1% for placebo, and an sPGA 0/1 response rate of 58.3% compared to 5.7% for placebo — remain compelling and underscore the therapeutic potential of Velonatib in this indication. We are confident that the redesigned CLARION-3R study, with a target enrollment of approximately 950 patients and PASI-75 at Week 16 as the primary endpoint, represents a viable and well-designed path to achieving the psoriasis indication and strengthening the overall submission package.
We look forward to resuming our work on behalf of Penterra when the time is right, and we remain committed to supporting the Company in advancing the Velonatib regulatory program. In the meantime, please do not hesitate to contact me or Joel Strauss at any time should you have questions about any of the matters addressed in this letter or if there is anything else we can assist with during the dormancy period.
With kind regards,
CALDERWOOD & HARKNESS LLP
By: /s/ Miriam Calloway
Miriam Calloway Partner, Healthcare & Life Sciences
cc: Joel Strauss, Partner, Calderwood & Harkness LLP Sean Morrissey, Associate, Calderwood & Harkness LLP Christopher Aiken, Associate, Calderwood & Harkness LLP
| Item | Amount |
| Total fees invoiced (July 7 – November 30, 2022) | $287,450.00 |
| Total fees collected | $287,450.00 |
| Outstanding accounts receivable | $0.00 |
| Unbilled work-in-progress | $0.00 |
| Disbursements invoiced | $4,212.38 |
| Disbursements collected | $4,212.38 |
| Outstanding disbursements | $0.00 |
| Write-offs | $0.00 |