In a bid to boost its ophthalmology portfolio,
Regeneron Pharmaceuticals, Inc.
) inked a deal with privately held Avalanche Biotechnologies,
Inc. Through the deal, Regeneron aims to jointly discover,
develop (using Avalanche's Ocular BioFactory technology) and
subsequently commercialize drugs for treating patients suffering
from ophthalmologic diseases.
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Under the terms of the deal, the private entity will receive an
upfront payment in cash and contingent payments totaling up to
$640 million following the achievement of certain development and
regulatory milestones. Furthermore, Regeneron will have to shell
out royalties on global net sales of drugs emanating from the
partnership, which covers up to eight distinct therapeutic
targets. Regeneron is entitled to exclusive global rights to each
candidate under clinical development.
Moreover, the ophthalmology deal grants Avalanche the option to
share costs of development and profits (following approval) with
Regeneron pertaining to two collaboration therapeutic targets
selected by the private entity. Furthermore, Regeneron will get a
time-limited option to acquire rights to Avalanche's
ophthalmology candidate AVA-101 following the completion of its
phase IIa study in wet age-related macular degeneration (AMD).
We are positive on the deal inked by Regeneron, which has already
tasted stupendous success with its eye drug Eylea. The first
approved indication for Eylea was wet AMD, the same indication
for which AVA-101 is being studied. Regeneron is aiming to
enhance its position in the lucrative ophthalmology market by
successfully developing candidates under the deal.
We are highly optimistic about the success of the deal since
Regeneron is vastly experienced in developing and subsequently
commercializing eye disorder treatments as can be gauged by
Eylea's success. Regeneron has a partnership with
) on Eylea.
Regeneron carries a Zacks Rank #3 (Hold). Better-ranked stocks in
the biopharma space include
). Both stocks carry a Zacks Rank #1 (Strong Buy).