Under terms of the agreement, Janssen, a subsidiary of New Brunswick, N.J.-based pharmaceutical and health-related consumer products conglomerate Johnson & Johnson, will receive exclusive rights to the drug plamotamab in exchange for an upfront payment of $100 million and the purchase of $25 million in Xencor shares.
“We are delighted to collaborate with Janssen’s leading scientists to expand the scope of the plamotamab program,” Bassil Dahiyat, Xencor’s chief executive, said in the announcement. “This collaboration complements our plans to initiate combination clinical trials of plamotamab with tafasitamab and lenalidomide, and it expands our strategy to develop multiple highly active chemotherapy-free regimens for B-cell (lymphoma) cancers.”
Tafasitamab is a monoclonal antibody that Xencor licensed to Planegg, Germany-based MorphoSys in 2010. Lenalidomide is marketed under the Revlimid label and is used to treat multiple myeloma; it is now owned by New York-based Bristol-Myers Squibb Co.
Later this year or early next year, Xencor is slated to begin a Phase 2 clinical trial of this drug combination in lymphoma patients. Work on this trial is proceeding on a separate track from the latest agreement with Janssen.
The Oct. 4 agreement specifically calls for Janssen to pay 80% of the cost of development of plamotamab, with Xencor picking up the remaining 20%.
For antibodies that are developed without the plamotamab molecule, Xencor retains an option to co-fund development costs in exchange for higher royalties.
In addition, as part of a two-year research collaboration between the two parties, Xencor can apply its technology to identify other antibody candidate drugs to treat certain types of lymphomas. Janssen will then have an exclusive license to develop selected molecules, either separately or in combination with plamotamab.
According to the announcement, Xencor’s agreement with Janssen must meet certain closing conditions, including approval under the Hart-Scott-Rodino Antitrust Improvements Act. Closing is expected to occur later this quarter.
Shares of Xencor closed up 5.5% on Oct. 4 after the announcement, finishing the day at $35.52, even as the broader Nasdaq exchange closed that day down 2%.
Xencor, founded in 1997, is developing engineered monoclonal antibodies for the treatment of cancer and autoimmune diseases.
This is the second collaboration and licensing agreement that Xencor has inked with Janssen Biotech in the last year.