Johnson & Johnson's
) Janssen Biotech, Inc. recently signed a worldwide license and
development agreement with Danish company Genmab A/S. The agreement
covers Genmab's oncology candidate, daratumumab.
Daratumumab, a human monoclonal antibody (mAb) which is
currently in phase I/II studies, is being investigated for
relapsed, refractory multiple myeloma.
Terms of the Deal
Per the terms of the deal, Genmab will receive an upfront
payment of $55 million and development, regulatory and sales
milestones. Genmab will also be entitled to receive tiered
double-digit royalties on global sales of daratumumab. Janssen will
fund all expenses associated with the research, development,
manufacturing and commercialization of daratumumab.
Moreover, Janssen will make an $80 million equity investment in
Genmab which means it will hold about 10.73% of Genmab's share
capital once the deal closes. The total value of the deal could
exceed $1.1 billion.
In return, Janssen will gain exclusive worldwide rights to the
candidate as well as a back-up CD38 human antibody.
While Genmab will be responsible for phase I/II trials (GEN501
and GEN503) with daratumumab, other development, clinical and
regulatory filing activities will be handled by Janssen. More than
10 new studies, including phase III studies, will be conducted
under the deal. Genmab expects to initiate a phase I/II study of
daratumumab plus Velcade in the coming months.
Besides multiple myeloma, daratumumab has the potential to be
evaluated for additional indications like acute myeloid leukemia,
diffuse large B-cell lymphoma, plasma cell leukemia, follicular
lymphoma, acute lymphoblastic leukemia, and mantle cell lymphoma.
Genmab said that it expects to evaluate daratumumab for at least
three new indications.
This deal is a major positive for Genmab. The deal will not only
strengthen the company's financial position in the form of upfront
and milestone payments, Genmab will also benefit from Janssen's
expertise and experience in the oncology market. Meanwhile, the
deal is in line with Johnson & Johnson's focus on hematological
cancers. The company already has a multiple myeloma product in its
portfolio - Velcade.
Customary closing conditions like approval by the Danish
Financial Supervisory Authority and clearance by the US antitrust
authorities need to be fulfilled for the closing of the deal.
Apart from Janssen, Genmab has deals with other companies like
), Cormorant Pharmaceuticals and
We currently have a Neutral recommendation on Johnson &
Johnson, which carries a Zacks #3 Rank (short-term Hold
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