UPDATE 1-Astellas, Regeneron extend antibody technology deal

* Astellas to pay Regeneron $165 mln as upfront payment

* Also to pay $130 mln in June 2018

* Regeneron posts narrower-than-expected Q2 loss

July 28 (Reuters) - Astellas Pharma Inc (4503.T) said it will pay up to $295 million to Regeneron Pharmaceuticals Inc (REGN.O) for extending the license agreement with Regeneron to discover new drugs.

In 2007, Astellas and Regeneron entered into a six-year agreement by which where Astellas made license payments of $20 million each year to Regeneron for using its antibody development technology to discover new drug candidates.

Under the new deal, Astellas would pay Regeneron $165 million as upfront payment and another $130 million in June 2018 unless it terminates the agreement prior to that date.

Astellas would also pay a mid-single-digit royalty on product sales upon commercialization of any antibody products discovered using Regeneron's technology.

The new agreement supersedes the original agreement and as such, Astellas will no longer make annual license payments in 2011 and 2012, the companies said.

REGENERON Q2 RESULTS

Regeneron posted a narrower-than-expected quarterly loss, helped partly by higher licensing payments from its partner Sanofi-Aventis (SASY.PA) for its antibody development technology.

For the second quarter, the company reported a net loss of 25.5 million, or 31 cents a share, compared with a loss of 14.9 million, or 9 cents a share, a year ago.

Revenue rose 29 percent to $115.9 million.

Analysts on average expected the company to post a loss of 38 cents a share, excluding special items, on revenue of $102.2 million, according to Thomson Reuters I/B/E/S.

Shares of Regeneron closed at $24.61 Tuesday on Nasdaq. (Reporting by Anand Basu in Bangalore; Editing by Prem Udayabhanu)