Sangamo to develop blood disorder drugs with Biogen
(Reuters) - Sangamo Biosciences Inc said it would collaborate with Biogen Idec Inc to develop treatments for a group of inherited blood disorders in a deal for up to $320 million.
Sangamo shares jumped as much as 30 percent to a six-year high of $17.73 on the Nasdaq on Thursday morning.
Biogen will use Sangamo's genome-editing technology to develop drugs targeting sickle cell disease and beta-thalassemia.
It will provide Sangamo $20 million upfront and reimburse costs related to research and development.
Sangamo will also be eligible for milestone payments of about $300 million, as well as double digit royalties on product sales.
The upfront payment and the terms of the milestone payments and the double digit royalties were pretty high, Wedbush analyst Liana Moussatos said.
"The deal terms are very lucrative for a pre-clinical platform. So I think Biogen must have been impressed with the pre-clinical data that Sangamo presented last month."
Sangamo presented the data last month at the annual meeting of the American Society of Hematology.
The company will be responsible for research and development for the first proof-of-concept study for beta-thalassemia, according to Thursday's deal.
Beta-thalassemia impairs the body's ability to produce hemoglobin, the protein in red blood cells (RBC).
Sickle cell disease changes the shape RBCs, tending to block blood flow.
Moussatos said Sangamo also had a promising HIV program, with a patient to stay with undetectable viral load for six months.
"That's another viable treatment and I won't be surprised if they announce another partnership for that," Moussatos said.
(Reporting by Shailesh Kuber; Editing by Joyjeet Das)