Halozyme Therapeutics Inc. (NASDAQ: HALO) saw its shares make a handy gain early on Thursday after the firm announced that it licensed its Enhanze drug-delivery technology to Roche for exclusive development of an “undisclosed therapeutic target.”
According to the agreement, Halozyme will receive an initial $30 million with the potential to earn additional payments of up to $160 million subject to regulatory and sales-based milestones. Halozyme also will receive tiered, mid-single digit royalties on sales of commercialized products.
Keep in mind that prior to the stock’s reaction, the company had a market cap of $1.85 billion, so these milestone payments would be significant for Halozyme.
For some quick background: the Enhanze drug-delivery technology is based on its patented recombinant human hyaluronidase enzyme (rHuPH20). It has been shown to remove traditional limitations on the volume of biologics that can be delivered subcutaneously (just under the skin).
Excluding Thursday’s move, Halozyme had outperformed the broad markets with the stock up 33% year to date. Over the past 52 weeks, the stock was up 22.5%.
Dr. Helen Torley, president and CEO, commented:
We are pleased to broaden our longstanding collaboration with Roche to include selection of a new target. With each new licensing agreement, we see the potential for our global partners to advance their innovative therapies, reducing the treatment burden for patients, caregivers and payers through shorter administration times or a less frequent dosing regimen.
Shares of Halozyme closed Wednesday at $13.18, with a consensus analyst price target of $17.44 and a 52-week range of $8.18 to $15.20. Following the announcement, the stock was up about 18% at $15.52 in early trading indications Thursday.