Xencor, Inc. (XNCR) Rockets on Licensing Deal With Novartis AG (NVS)

Shares of Monrovia, California, based Xencor, Inc. (XNCR) rose on Tuesday, against the backdrop of a strong day in stocks overall. Xencor's stock was up 32.06%, rising $4.02 per share, to close at $16.56, on volume of 3,102,591 shares. The company announced a licensing deal with Novartis AG (NVS) on two early stage blood cancer treatments, that could be worth as much as $2.41 billion.

Founded in 1997, Xencor, Inc. is a clinical-stage biopharmaceutical company, that focuses on discovering and developing engineered monoclonal antibodies to treat severe life-threatening diseases with unmet medical needs.
The company uses a proprietary technology platform to create next-generation antibody product candidates designed to treat autoimmune and allergic diseases, asthma, cancer, and other conditions. The company's stock trades on the NASDAQ.

Founded in 1996, and based in Basel, Switzerland, Novartis AG develops, manufactures, and markets healthcare products. It provides patent-protected prescription medicines, surgical, ophthalmic pharmaceuticals, vision care products, generic pharmaceuticals, human vaccines and blood testing diagnostics, affordable and reliable consumer medications for self-care and numerous common ailments. The company's stock trades on the New York Stock Exchange.

On Tuesday the two companies announced that they have entered into a licensing agreement on two early stage blood cancer treatments. The agreement could be worth as much as $2.41 billion. Xencor will retain US commercialization rights, while Novartis will pay a royalty for foreign sales. The two drug candidates are Xencor's XmAb14045 and XmAb13676, for acute myeloid leukemia and B-cell malignancies. Both drugs are set to begin clinical development in 2016. Novaris has the right to select four additional products for development, and to use Xencor's bispecific technology to develop as many as 10 more.

Novartis will pay $150 million upfront, but will also pay for clinical, regulatory and sales milestone payments if the programs are successful. Novartis stock closed up on the news on Tuesday, rising 3.04%, up $2.35 per share, to close at $79.59.

"We believe our flexible bispecific oncology platform has substantial potential," said Xencor President and Chief Executive Officer, Bassil Dahiyat, Ph.D. "Our programs are built on a novel XmAb Fc domain, which allows for the rapid creation of drug candidates that maintain important full-length antibody properties, without the manufacturing and commercialization challenges that have historically blocked the viability of bispecific antibodies. As we announced earlier this morning, we are excited to collaborate with Novartis on the development of our two lead bispecific oncology programs, XmAb14045 and XmAb13676, while maintaining commercialization rights for both candidates in the U.S. In addition, we are unveiling two new programs today, XmAb18087 and XmAb20717 for the treatment of neuroendocrine tumors and multiple cancers, respectively."

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Published on Jun 29, 2016
By Kevin Mercadante

Copyrighted 2016. Content published with author's permission.

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