By Michael Erman and Ludwig Burger
(Reuters) -Bristol Myers Squibb will pay $1.5 billion upfront to partner with Germany’s BioNTech on an experimental cancer drug, the U.S. company said on Monday, in a deal that could eventually exceed $11 billion in value for BioNTech.
The deal provides a boost for the German company’s ambition to continue its costly long-term focus on experimental cancer treatments, and show that its success as Pfizer’s COVID-19 vaccine partner was not a one-off achievement.
BioNTech’s Germany-listed shares surged 13.1% by 1117 GMT to a one-month high.
Bristol said it will co-develop and co-commercialize BioNTech’s drug, BNT327, for multiple solid tumour types.
The deal underscores the industry’s focus on a new dual mechanism of action in oncology. BNT327 is designed to activate the immune system, similar to an established drug class including Merck & Co’s Keytruda, but also to cut a tumour’s blood supply.
“We are impressed by the innovation that BioNTech has achieved to date and we look forward to partnering to accelerate existing clinical trials and time to market, while expanding the number of potential indications,” Bristol Myers CEO Chris Boerner said in a statement.
Shares in Instil Bio, which is working with ImmuneOnco on a similar compound, soared 41% in U.S. premarket trade.
Summit Therapeutics and Akeso have formed another partnership in the development race with a drug candidate called ivonescimab.
BioNTech took full ownership of BNT327 through the acquisition of China’s Biotheus earlier this year for $800 million upfront and up to $150 million contingent on development achievements.
It previously held certain rights in the drug under a 2023 collaboration deal.
In addition to the initial payment, Bristol plans to pay BioNTech up to $2 billion more in non-contingent anniversary payments through 2028. BioNTech may also earn up to $7.6 billion more in development, regulatory and commercial milestones, Bristol said.
The companies will share global profits and losses from the drug equally, and joint development and manufacturing costs will also be shared on a 50/50 basis, subject to some exceptions.
BNT327, part of a drug category known as bispecific antibodies, is currently being tested as a first-line treatment in extensive stage small cell lung cancer and non-small cell lung cancer. More than 1,000 patients have been treated with the drug to date.
(Reporting by Michael Erman and Ludwig Burger; Editing by Jacqueline Wong and Susan Fenton)
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