Geron Corporation ( GERN ), a clinical-stage biopharmaceutical company, announced that it has entered into an exclusive worldwide license and collaboration agreement with Janssen Biotech, Inc., a unit of Johnson & Johnson ( JNJ ) for the development and commercialization of its sole pipeline candidate, imetelstat.
Imetelstat is being evaluated for a variety of hematologic myeloid malignancies such as myelofibrosis (MF), myelodysplastic syndrome (MDS) and acute myelogenous leukemia (AML).
Per the agreement, Geron will initially receive a payment of $35 million along with potential milestone payments of $900 million and royalties on sales as and when booked by Janssen Biotech.
Meanwhile, both companies will equally share the development costs of various studies on imetelstat, which include phase II studies in MF and MDS as initial studies, additional registration studies in MF and MDS, and an exploratory phase II and potential follow-on phase III studies in AML. Geron plans to commence a phase II study on imetelstat for the treatment of MF in mid-2015 followed by a phase II study for MDF.
The going is finally getting good for Geron. The collaboration with Janssen Biotech will immensely boost imetelstat's development plans which had suffered a setback earlier in 2014 when the FDA placed a full clinical hold on Geron's investigational new drug application for the candidate. Nevertheless, the FDA recently removed the hold on imetelstat.
Hence, the news of the collaboration with Janssen will further boost investor confidence on Geron's growth prospects, which is entirely dependent on the successful development of imetelstat.
Shares are expected to react positively to the news. Geron is a Zacks Rank #3 (Hold) stock. Some better-ranked biotech stocks include Biogen Idec ( BIIB ) and Affymetrix Inc ( AFFX ). Both carry a Zacks Rank #1 (Strong Buy).
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