Why Biohaven Stock Was Rocking the Market This Week
Key Points
Its partner is South Korean peer SK Biopharmaceuticals.
It also secured a victory in a lawsuit.
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The past few business days have been eventful for Biohaven (NYSE: BHVN). The company, which, in its present incarnation, is a clinical-stage biotech, agreed to an impressive licensing and collaboration deal with a peer and secured a favorable judgment in a court case.
These factors helped propel Biohaven stock to a more than 16% gain week to date as of Friday before market open, according to data compiled by S&P Global Market Intelligence.
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795 million reasons to be optimistic
Of the two developments, the more impactful was that agreement. Early Wednesday morning, Biohaven announced that South Korea-based SK Biopharmaceuticals will compensate it with up to $795 million in upfront and milestone payments for an exclusive worldwide license to its Kv7 ion channel platform.
Image source: Getty Images.
SK is also being granted the rights to Biohaven's lead drug candidate, opakalim, which is being developed to treat focal epilepsy (a form of the disorder that is localized in the brain). If and when the drug is approved by the U.S. Food and Drug Administration (FDA), SK would be on the hook to pay Biohaven tiered royalties on its American sales.
It'll also be responsible for paying the Kv7 program's costs.
As for that legal case, on Tuesday, a judge in the U.S. District Court of Delaware entered judgment in favor of Biohaven and Yale University, following a jury's verdict last month.
The two organizations had filed a trade secret misappropriation and breach-of-contract suit against biotech Avilar Therapeutics and RA Capital Management. Biohaven and Yale have been awarded a total of $4 million in the suit.
Drug of choice
It's very encouraging whenever a company, particularly one in the always capital-hungry biotech sector, reports two positive news items. The SK agreement is the one to watch of the pair, especially considering that opakalim has had mixed results in clinical trials for certain indications.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
