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Jazz Inks Deal with Codiak to Develop Exosome Therapeutics

Zacks Equity Research

Jazz Pharmaceuticals plc JAZZ entered into a collaboration with Codiak BioSciences, Inc. to focus on the research, development and commercialization of exosome therapeutics to treat cancer.

Jazz gained exclusive worldwide rights to develop, manufacture and commercialize exosome candidates directed at five oncogene targets for hematological malignancies and solid tumors to be developed using Codiak's engEx precision engineering platform for exosome therapeutics. The deal includes therapies against NRAS and STAT3, both of which are historically undruggable intracellular targets. 

Share price of Jazz decreased 7.9% in the past one year compared with the industry’s decline of 21.7%.

 

Per the agreement, Codiak will receive a $56-million upfront fee and is also eligible for up to $20 million in preclinical development milestones across all five programs. Plus, it is entitled to receive up to $200 million per target based on Investigational New Drug (IND) application acceptance, clinical development and regulatory milestones including approvals in the United States, European Union and Japan besides sales milestones. Codiak is also eligible to receivetiered royalties ranging from mid-single digits to high teens for each approved product.

Codiak will be responsible for preclinical and early clinical development of therapeutic candidates directed atall five targets through phase I/II proof-of-concept trials, after which Jazz will be responsible for further clinical development, regulatory submissions and commercialization of each product. Codiak has the option to participate in co-commercialization and cost/profit-sharing in the United States and Canada on up to two products.

An IND for the first program should be submitted within two to three years.

Codiak’s exosome platform is unique and complements Jazz’s CombiPlexplatform and other collaboration programs. Codiak engEx platform along with Jazz's insights into relevant but intractable targets creates a unique opportunity for the latter to improve patient outcomes in various cancers.

Jazz has added several drugs to its marketed portfolio and clinical-stage candidates to its pipeline through acquisitions.

Jazz Pharmaceuticals PLC Price

Jazz Pharmaceuticals PLC Price | Jazz Pharmaceuticals PLC Quote

 

Zacks Rank & Stocks to Consider

Jazz currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks worth considering are Myriad Genetics, Inc. MYGN, Inovio Pharmaceuticals, Inc. INO and Editas Medicine, Inc. EDIT. While Myriad and Inovio sport a Zacks Rank #1 (Strong Buy), Editas carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Myriad’s earnings per share estimates have increased from $1.66 to $1.75 for 2018 and from $1.88 to $1.89 for 2019 over the past 60 days. The company delivered a positive earnings surprise in all the trailing four quarters, with average of 25.62%.

Inovio’sloss per share estimates have narrowed from $1.06 to $1.00 for 2018 and from $1.09 to $1.06 for 2019 in the past 60 days.The company delivered a positive earnings surprise in three of the trailing four quarters, with average of 21.11%.

Editas’ loss per share estimates have narrowed from $3.00 to $2.18 for 2018 and from $3.36 to $2.84 for 2019 in the past 60 days.The company delivered a positive earnings surprise in two of the trailing four quarters, with average of 10.85%.

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