ImmunoGen Inc. (NASDAQ: IMGN) has decided to partner with Jazz Pharmaceuticals PLC (NASDAQ: JAZZ) for the development and commercialization of two early-stage, hematology-related antibody-drug conjugate (ADC) programs, as well as an additional program to be designated during the term of the agreement.

Under the agreement, these programs include IMGN779, a CD33-targeted ADC for the treatment of acute myeloid leukemia (AML) in Phase 1 testing, and IMGN632, a CD123-targeted ADC for hematological malignancies expected to enter clinical testing before the end of the year.

Also ImmunoGen will be responsible for the development of the three ADC programs prior to any potential opt-in by Jazz. After any opt-in, Jazz would then be responsible for any further development as well as for potential regulatory submissions and commercialization.

In terms of the money, Jazz will pay ImmunoGen an upfront payment of $75 million. Additionally, Jazz will pay ImmunoGen up to $100 million in development funding over seven years to support the three ADC programs.

What this buys is that for each program, Jazz may exercise its opt-in right at any time prior to a pivotal study or any time prior to a biologics license application (BLA). For each program to which Jazz elects to opt-in, ImmunoGen would be eligible to receive milestone payments based on receiving regulatory approval of the applicable product, plus tiered royalties as a percentage of commercial sales.

Mark Enyedy, president and CEO of ImmunoGen, commented:

This strategic partnership with Jazz significantly advances our goal of accelerating the development of our early-stage novel ADC assets. This deal joins us with a global partner, provides us with substantial funding to support these programs, and preserves the right to co-commercialize one of these assets. Jazz has demonstrated the ability to bring innovative compounds to patients and will make an ideal partner to help develop and commercialize our novel ADC assets targeting AML, and more broadly, in the area of hematology/oncology. In addition, this partnership significantly strengthens our financial position and moves us closer to delivering upon our mission of bringing ADC therapies to patients.

Shares of ImmunoGen were last seen up more than 18% at $7.64, with a consensus analyst price target of $8.00 and a 52-week trading range of $1.51 to $8.04,

Jazz shares were last seen down near 1% to $144.29, with a 52-week range of $95.80 to $163.75 and a consensus price target of $182.29.

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