Pfizer, Inc (NYSE: PFE) has signed an agreement with the much smaller AVANT Immunotherapeutics (NASDAQ: AVAN). The two have announced an agreement where Pfizer will be granted an exclusive worldwide license to its CDX-110 therapeutic cancer vaccine candidate and the agreement also gives Pfizer exclusive rights to the use of EGFRvIII vaccines in other potential indications.
CDX-110 is currently under both Fast Track and Orphan Drug designations by the FDA for GBM, and the company just put out positive Phase II data yesterday.
Terms of the licensing and development agreement are for Pfizer to make an upfront payment to AVANT of $40 million and Pfizer will also make a $10 million equity investment in AVANT. Pfizer will fund all R&D costs for these programs. AVANT is still eligible to receive milestone payments of more $390 million for the successful development and commercialization of CDX-110 and additional EGFRvIII vaccine products. It can also reveive double-digit royalties on any product sales.
GBM is the most common and aggressive form of primary brain tumor, with very poor prognosis. There are an estimated 10,000 new cases of GBM annually in the United States, which predominantly affects adults aged 45 to 70. The current standard treatment for patients with GBM includes surgical resection, radiotherapy with concurrent temozolomide and then adjuvant temozolomide chemotherapy.
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Shares of AVANT were up marginally by 0.3% today at $10.05, but shares had surged by more than 30% to $14.50 after this news was released. Its 52-week trading range is $4.80 to $15.96. Before this after-hours surge, AVANT’s market cap was just under a mere $17 million (yep, seventeen).
Jon C. Ogg
April 16, 2008
Jon Ogg produces the Special Situation Investing Newsletter. He can be reached at firstname.lastname@example.org and he does not own securities in the companies he covers.