Five Prime Therapeutics In License Agreement with Seattle Genetics

By Michael Dabaie

Five Prime Therapeutics Inc. said Wednesday it is in a global license agreement with Seattle Genetics Inc. to develop and commercialize novel antibody-drug conjugate therapies using monoclonal antibodies developed by Five Prime.

Shares rose 9% to $4.80 in early trading.

Five Prime granted Seattle Genetics an exclusive worldwide license to a family of monoclonal antibodies that are directed to a single target and Seattle Genetics will be responsible for research, development, manufacturing and commercialization of ADC products based on these antibodies.

For the multi-product deal, Five Prime will receive a $5 million upfront payment and is eligible to receive progress-dependent development and regulatory milestone payments as well as cumulative commercial milestone payments. Cumulative milestones may reach up to $295 million for the first ADC product developed and commercialized, Five Prime said.

Five Prime said it will additionally receive tiered mid-single digit royalties on net product sales.

On Tuesday, Five Prime said that Bristol-Myers Squibb informed the company that randomized Phase 2 trial testing of the combination of cabiralizumab with Opdivo with and without chemotherapy in patients with advanced pancreatic cancer didn't meet its primary endpoint. Five Prime said Bristol-Myers has no near-term plans for additional sponsored development of cabiralizumab, but will continue to support the evaluation of cabiralizumab in select, ongoing investigator-sponsored trials and may continue to assess future development opportunities.

Wedbush lowered the stock to neutral from outperform and cut its price target to $5 from $12 a share on the announcement the pancreatic cancer study didn't meet its primary endpoint.

Given that Bristol-Myers Squibb will no longer directly support development of cabiralizumab, "we now see little to no value in the asset and are removing the program from our model," Wedbush said.

Write to Michael Dabaie at [e-mail]

(END) Dow Jones Newswires

February 19, 2020 10:16 ET (15:16 GMT)

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