UCB (Other OTC:UCBJY.PK - News) and Immunomedics, Inc. (NasdaqGM:IMMU - News) recently announced that they have amended their agreement for the worldwide development, marketing and sale of epratuzumab for all autoimmune disease indications. According to the new agreement, UCB returned its buy-in right to Immunomedics for the cancer indication of the candidate, and in return got the flexibility to select a partner to sublicense epratuzumab’s rights for certain territories.
On the execution of the amendment, Immunomedics is entitled to receive a cash payment of $30 million. Moreover, if UCB exercises its right to sublicense, it will have to make another cash payment of $30 million to Immunomedics, along with additional payments upon the achievement of new regulatory and sales milestones. Also as a part of the agreement, Immunomedics will issue a 5-year warrant to UCB for the purchase of one million shares of Immunomedics’ common stock at an exercise price of $8.00 per share.
UCB in-licensed epratuzumab from Immunomedics in May 2006, to develop, market and sell the molecule worldwide as a treatment for autoimmune diseases. Under the original agreement UCB was to book potential future sales of epratuzumab and pay royalties on these sales to Immunomedics.
We note that epratuzumab is currently being evaluated in two late-stage trials, EMBODY1 and EMBODY 2, for the treatment of patients with moderate-to-severe lupus. Both these trials are being conducted to evaluate the efficacy, safety, tolerability, and immunogenicity of epratuzumab when administered with standard-of-care treatments in patients with moderate-to-severe systemic lupus erythematosus (NYSE:SLE - News). Initial results from these trials are expected in the first half of 2014.
We currently have a Zacks #3 Rank (short-term Hold rating) on UCB.
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