Health and Healthcare
Did Immunomedics Rise Too Much as Seattle Genetics Deal Terminated?
Published:
Last Updated:
Shares of Immunomedics Inc. (NASDAQ: IMMU) saw a massive gain on Friday after the company announced the termination of its licensing deal with Seattle Genetics Inc. (NASDAQ: SGEN). It may seem counterintuitive that shares would rise after such an announcement. So 24/7 Wall St. has taken a closer look at the report to see if this rise is justified.
Seattle Genetics decided to terminate the licensing deal following intense legal battles, also after Immunomedics announced that its president and CEO, Cynthia Sullivan, was no longer at the helm.
Back in February, Immunomedics inked a deal with Seattle Genetics for a potential $2 billion for the development of its IMMU-132, with a $250 million upfront payment, for the treatment of metastatic triple-negative breast cancer (mTNBC). However the deal was placed on Hold in March following a shareholder revolt.
Not to mention, that Seattle Genetics also will continue to hold roughly 3 million shares of Immunomedics common stock, as well as a warrant to purchase an additional 8.7 million shares at $4.90 per share.
Immunomedics also will delay its submission for its Biologics License Agreement (BLA) for IMMU-132 until late in the fourth quarter of this year or in the first quarter of 2018.
Separately, the firm also made a $125 million private placement offer to further support the development of IMMu-132 to file a BLA for accelerated approval with the U.S. Food and Drug Administration (FDA). Currently the company only has a market cap of roughly $675 million.
Most of the rally in the shares was following the announcement of executives stepping down. It seems that this may have been more of a concern for investors than the deal being cut.
The mid-April short interest report noted that Immunomedics had 25.46 million shares short, compared to the previous level of 26.65 million.
Shares of Immunomedics closed Friday up 17.6% at $6.36, with a consensus analyst price target of $7.50 and a 52-week trading range of $1.95 to $7.15.
The #1 Thing to Do Before You Claim Social Security (Sponsor)
Choosing the right (or wrong) time to claim Social Security can dramatically change your retirement. So, before making one of the biggest decisions of your financial life, it’s a smart idea to get an extra set of eyes on your complete financial situation.
A financial advisor can help you decide the right Social Security option for you and your family. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.
Click here to match with up to 3 financial pros who would be excited to help you optimize your Social Security outcomes.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
