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$2 Billion Biotech Licensing Deal Cancelled

Drug vials

(angelsalamag054, Pixabay)

8 May 2017. A licensing deal with a potential value of more than $2 billion between two biotechnology companies for a new breast cancer drug was cancelled on Friday. However, Immunomedics Inc., in Morris Plains, New Jersey, says it found alternative financing to continue development of the drug, which it previously licensed to Seattle Genetics in Bothell, Washington.

Under the agreement announced in February 2017, Seattle Genetics received an exclusive license to further develop and commercialize the drug sacituzumab govitecan, code-named IMMU-132 by Immunomedics, an antibody drug conjugate. Both Seattle Genetics and Immunomedics create antibody-drug conjugates, which join highly-targeted synthetic antibodies with other compounds or additives to combine the targeting of antibodies with cancer-killing power of the drugs being delivered. Seattle Genetics paid $250 million upfront and agreed to further payments to Immunomedics totaling $2.1 billion if all developmental and regulatory milestones were met.

As reported in Science & Enterprise, Immunomedics’s technology combines synthetic antibodies with cancer-killing compounds that by themselves would not be given to patients due to their toxicity. In this case, IMMU-132 targets Trop-2 proteins that overproduce on the surface of tumor cells in a number of solid-tumor cancers and help drive tumor growth. In IMMU-132, an antibody called hRS7 targets Trop-2 proteins that combines with SN-38, a metabolite of the drug irinotecan and approved by FDA as a chemotherapy.

According to the Seattle Times, Immunomedics has gone through legal and management turmoil since the deal’s announcement. Activist investors in Immunomedics objected to the deal, arguing Seattle Genetics should have paid a higher price for IMMU-132. The investors, led by venture capital company VenBio, sued in a Delaware state court, which in March issued a temporary restraining order to halt the agreement. In a Seattle Genetics statement on Friday, company CEO Clay Siegall attributed the cancellation to, “significant delays and lack of progress towards closing the deal ….”

On Friday, Immunomedics’ founder David Goldenberg, and Cynthia Sullivan, Goldenberg’s wife who serves as company CEO, stepped down. Chief financial officer Michael Garone will stay on as interim CEO. While both parties agreed to cancel  the licensing deal, Seattle Genetics continues to hold 3 million shares in Immunomedics stock, as well as an option to purchase more shares at a favorable price.

Immunomedics says it raised $125 million in a private stock sale to fund new clinical trials of IMMU-132. The antibody drug conjugate is in an intermediate-stage trial testing the treatment with individuals having a number of different solid tumor cancers. Intermediate- and late-stage trials testing the antibody drug conjugate in people with triple negative breast cancer are not yet recruiting participants, according to ClinicalTrials.gov.

The company still believes the U.S. Food and Drug Administration will approve an accelerated schedule for a biologics license application and review of IMMU-132 to treat triple-negative breast cancer in combination with other drugs. The agency gave IMMU-132 a breakthrough designation in February 2016. Immunomedics says it recruited 100 participants for its intermediate-stage trial by December 2016, and it expects to start enrolling individuals in its late-stage trial in the last quarter of 2017.

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