ImmunoGen, Inc. (IMGN): Collaboration with Jazz Sent Shares Rallying, Cowen Comments

ImmunoGen, Inc. (NASDAQ:IMGN) shares are rallying today thanks to news of a collaboration agreement with Jazz Pharmaceuticals (NASDAQ:JAZZ) for the development and commercialization of  two early-stage hematology-related antibody-drug conjugate (ADC) programs and a third undesignated ADC program. As of this writing, shares of ImmunoGen are up nearly 21% to $7.80.

Under the terms of the deal with Jazz, ImmunoGen will receive $75 million of upfront milestone payments, up to $100 million in research support, and additional co-commercialization options and potential opt-in milestone and royalty fees. In addition, ImmunoGen will be responsible for development of three antibody drug conjugates (ADC), including IMGN779 and IMGN632. JAZZ has the right to opt-in at any point prior to a pivotal study or at any time prior to BLA filing. Following an opt-in, Jazz and ImmunoGen will share developmental and commercialization costs in the U.S. and the E.U. ImmunoGen will also have the right to opt-in to co-develop up to two products with U.S. profit sharing, instead of receiving milestone and royalty payments from Jazz.

ImmunoGen CEO Mark Enyedy stated, “This strategic partnership with Jazz significantly advances our goal of accelerating the development of our early-stage novel ADC assets. This deal joins us with a global partner, provides us with substantial funding to support these programs, and preserves the right to co-commercialize one of these assets […] Jazz has demonstrated the ability to bring innovative compounds to patients and will make an ideal partner to help develop and commercialize our novel ADC assets targeting AML, and more broadly, in the area of hematology/oncology. In addition, this partnership significantly strengthens our financial position and moves us closer to delivering upon our mission of bringing ADC therapies to patients.”

Cowen analyst Boris Peaker commented, “The deal gives IMGN access to complementary capabilities that includes both Jazz’s sales force and hematology-oncology portfolio. Moreover, it provides IMGN with financial support to advance these early stages programs, but also strengthens the balance sheet to support mirvetuximab’s pivotal program. As of 2Q17, IMGN guided that its cash position was sufficient to fund operations into 2H18. Today’s deal likely takes IMGN into 2019 and potentially topline mirve FORWARD I data in 1H19, but it will still likely require additional financing to be in a comfortable cash position at the time of FORWARD I’s readout. We view today’s deal terms as very favorable and commend IMGN for executing on strategy it previously laid out to establish deals for non-core assets and co-development/commercialization deals for core assets.”

Sentiment on the street is mostly bullish on IMGN stock. Out of 6 analysts who cover the stock, 4 suggest a Buy rating and 2 recommend to Hold the stock. The 12-month average price target assigned to the stock is $10.00, which represents a potential upside of 45% from where the stock is currently trading.

ImmunoGen, Inc. is a biotechnology company, which develops novel anticancer therapeutics using its antibody-drug conjugate technology. Its product candidates include Mirvetuximab Soravtansine, Coltuximab ravtansine and Kadcyla .


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