UPDATE 1-Innate Pharma shares jump on Bristol-Myers deal
* Bristol-Myers to develop and distribute new cancer antibody
* French biotech to receive up to $465 mln
* Innate shares leap 65 pct
(Adds detail, background)
PARIS, July 7 (Reuters) - Shares in Innate Pharma (IPH.PA) climbed 65 percent on Thursday after it agreed what it called the largest biotech deal ever signed in France with Bristol-Myers Squibb (BMY.N) for a potential cancer treatment.
Innate Pharma said it granted its U.S.-based partner exclusive worldwide rights to develop, make and sell the anti-cancer antibody, known as IPH2102, which uses the body's immune system to fight tumours.
Bristol-Myers will fund the antibody's development and will pay Innate Pharma up to $465 million, including a $35 million upfront sum, linked to meeting certain targets.
The French company will also receive double-digit royalty payments on worldwide net sales, the companies said in a statement.
The IPH2102 antibody is still at an early development stage, being tested on cancer patients in a so-called Phase I clinical trial, and analysts described the price paid by Bristol-Myers as impressive.
"Such amounts became rare lately in the French biotech sector and are usually devoted to more advanced molecules," Aurel BGC analysts wrote in a research note.
"The amounts of the deal are quite significant compared to Innate's size," Bryan Garnier analyst Sebastien Malafosse said.
"Bristol-Myers Squibb's know-how will accelerate the product's development and we think this announcement reinforces the stock's attractiveness and visibility," he added.
Shares in Innate Pharma, based in the southern French city of Marseilles, were trading at 2.2 euros at 1050 GMT in a flat Paris market, giving the company a market value of around 82.5 million euros ($118 million).
Innate Pharma posted sales of 4.3 million euros in 2010, down 44 percent year-on-year, and a net loss of 13.6 million.
The company is focusing on developing monoclonal antibodies, which are tailor-made proteins that can detect the proteins stuck to cancer cells and block their growth.
Danish drugmaker Novo Nordisk (NOVOb.CO) owns nearly 15 percent of Innate Pharma's share capital, while France's FSI sovereign investment fund holds almost 13 percent, according to the company's website.
INTERVIEW-Innate CFO hopeful for cancer drug candidate
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^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> ($1=.6991 Euro) (Reporting by Matthias Blamont; Editing by James Regan)
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