Seattle Genetics Earns Milestone Payment
Seattle Genetics, Inc.(SGEN) has earned a milestone payment of $6 million from Takeda Pharmaceutical Company Limited (TKPYY) following the first commercial sales of Adcetris in key countries (Australia, South Korea and Mexico).
We note that Seattle Genetics entered into a collaboration agreement with Takeda to develop and commercialize Adcetris in Dec 2009. As per the deal, Seattle Genetics has rights to commercialize Adcetris in the U.S. and Canada while Takeda has commercialization rights in the rest of the world.
Seattle Genetics is entitled to receive royalties at rates that range from the mid-teens to the mid-twenties based on net sales of Adcetris within Takeda’s licensed territories.
Adcetris is approved for the treatment of relapsed or refractory Hodgkin lymphoma (HL) and systemic anaplastic large cell lymphoma.
Seattle Genetics is working on expanding Adcetris’ label. Seattle Genetics completed treatment of all patients in a phase III study, AETHERA. The study is evaluating HL patients. The primary efficacy results will be out in the second half of 2014. Adcetris also obtained orphan drug designation for diffuse large B-cell lymphoma.
Seattle Genetics currently carries a Zacks Rank #3 (Hold). Adcetris is at present approved in 40 countries. Adcetris’ revenues in the year 2013 were $144.7 million. We expect investor focus to remain on the sales ramp up of the drug and further label expansion.
Investors looking for better-ranked stocks in the biopharma sector may consider companies like Shire (SHPG) and Alkermes (ALKS). Shire carries a Zacks Rank #2 (Buy) while Alkermes holds a Zacks Rank #1 (Strong Buy).
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