Applied Genetic Technologies Corp. (NASDAQ: AGTC) announced that the Biogen Inc. (NASDAQ: BIIB) equity investment as part of their collaboration has closed. As per the agreement that was set in early July, this is a broad collaboration and license agreement focused on the development of gene-based therapies for two orphan diseases of the retina and three options for early stage discovery programs in two ophthalmic diseases and one non-ophthalmic condition.

Under the terms of the agreements, Biogen will make near-term payments, including an upfront payment in the amount of $124 million, to Applied Genetic, which includes a $30 million equity investment at a purchase price of $20.63 per share. Applied Genetic is eligible to receive upfront and milestone payments exceeding $1 billion in total. Biogen will be granted a license to the XLRS and XLRP programs and the option to license discovery programs for three additional indications at the time of clinical candidate selection.

Sue Washer, CEO of Applied Genetic, said:

We are excited to combine our deep experience in gene therapy and ophthalmology with Biogen’s strong track record of developing and marketing therapies for complex and rare diseases. This collaboration will provide many synergies, enabling us to accelerate our lead programs for the treatment of X-Linked Retinoschisis (XLRS) and X-linked Retinitis Pigmentosa (XLRP), two ocular conditions with significant unmet needs, and three discovery programs, including a non-ophthalmic condition. In addition, we now have expanded resources to accelerate the development of several internal programs, including our program for the treatment of achromatopsia.

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Shares of Applied Genetic were down 0.7%, at $15.40 Thursday morning. The stock has a consensus analyst price target of $32.00 and a 52-week trading range of $14.40 to $28.24.

Biogen shares were up 1% to $312.63, in its 52-week range of $290.85 to $480.18. The consensus price target is $389.27.

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