Xoma Corp., whose stock crashed in July on the failure of its lead drug against an eye disease, said today it signed a potential $530 million licensing deal with Swiss drug developer Novartis AG for an experimental cancer immunotherapy treatment.
Xoma stock shot up 43 percent, or 32 cents per share to $1.07 in late trading Thursday.
Xoma CEO John Varian: Novartis is "the best company" to carry forward Xoma's experimental cancer-fighting antibody.
Initially, the deal disclosed earlier Thursday would give the Berkeley company (NASDAQ: XOMA) $37 million upfront from Novartis (NYSE: NVS). That would be a financial shot in the arm for a company with an accumulated deficit of $1.16 billion over its 31-year history and cash & equivalents of $51 million as of June 30.
As part of the deal, Novartis extended the maturity date on about $13.5 million of outstanding debt to Sept. 30, 2020, and Xoma agreed to reduce the royalty rate paid by Novartis for antibodies already in the clinic.
The $530 million figure includes development, regulatory & commercial milestones — so-called bio-bucks — that could take years to hit. Xoma also potentially would receive mid-single digit to low double-digit royalties on any products sales, assuming a drug successfully runs the gauntlet of clinical trials and the drug-approval process.
"Xoma and Novarties have worked closely together for several years to develop new product candidates," Xoma CEO John Varian said in a press release. "When they expressed interest in our (immunotherapy) program, we knew Novartis was the best company to bring this exciting potential therapy to the patients whom it may help."
Several companies have focused on immune-modulating therapies to reset the system that normally protects us from foreign invaders but is tricked by tumors.
Xoma's program targets transforming growth factor-beta, or TGFb, a protein involved in immune suppression & inhibiting cell growth.
Great advice, SlingnLose! How did this POS work out for ya? Make a lot of money shorting, did ya?
Sentiment: Strong Buy
I suspect you are correct. HFTs shorting and manipulating this stock today which they will probably keep doing until some news hits.
.73 cents seems to be the magic number right now. Someone is buying it up like crazy at .73 cents. The bid size is huge now, over 70,000, and they keep adding to it.
I noticed it when it happened and the volume of the trade is precisely the reason it was most likely a Hedge fund trade. It was actually 8,116,453 shares.
Grim? Not sure how you came to that conclusion. If someone sold that many shares, someone bought that many. The question is who bought them? I suspect it was a corporate Hedge fund trade. Hedge funds often trade stocks.