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Merck’s multi-billion dollar bet on Seattle Genetics sparks hope for breast cancer treatments

Shares of Seattle Genetics are hovering greater than 10% this morning after the Bothell, Wash.-based biotechnology firm struck a take care of Merck by which the pharmaceutical powerhouse will present a $600 million upfront cost and make a $1 billion fairness funding to proceed improvement of treatments for breast cancer.

Merck is buying 5 million shares of Seattle Genetics at $200 per share as a part of the deal, which focuses on Seattle Genetics’ experimental LIV-1 product, presently in Section 2 medical trials. As a part of the deal, Seattle Genetics might obtain $2.6 billion if improvement milestones are met, and one other $1.75 billion if gross sales milestones are reached.

The businesses additionally mentioned they plan to share the prices of growing LIV-1, with a 50-50 cut up on future prices and income. Merck may also combine the Seattle Genetics R&D efforts with its personal Keytruda breast cancer therapy program, a part of an ongoing collaboration between the 2 firms.

Fierce Biotech reports that the Merck normally doesn’t make massive bets of this sort on biotechnology merchandise. The information web site notes that the take care of Seattle Genetics comes inside hours of Gilead Sciences agreeing to buy Immunomedics for $21 billion. Immunomedics, like Seattle Genetics, is growing antibody medicine for breast cancer.

Seattle Genetics and Immunomedics as soon as labored carefully collectively on cancer treatments, however the $2 billion collaboration ended abruptly in 2017 after a messy cut up.

Along with the collaboration on LIV-1, Merck agreed to pay $125 million to Seattle Genetics for an unique license for Tukysa, a therapy for HER-2-positive cancers in areas exterior of the U.S.

Merck will personal about 2.9 p.c of Seattle Genetics as soon as the deal concludes, The Wall Street Journal reports. Seattle Genetics employs about 1,800, and boasts a market worth of $29 billion.

Seattle Genetics CEO Clay Siegall mentioned the Merck collaboration will speed up its breast cancer and different strong tumor applications.

Right here’s how Seattle Genetics explains the science behind Ladiratuzumab vedotin, an antibody-drug conjugate generally known as LIV-1.

Most metastatic breast cancers specific LIV-1, which additionally has been detected in various different cancers, together with melanoma, prostate, ovarian, uterine, and cervical cancers. Ladiratuzumab vedotin consists of a LIV-1-targeted monoclonal antibody linked to a potent microtubule-disrupting agent, monomethyl auristatin E (MMAE) by a protease-cleavable linker. This novel ADC agent is designed to bind to LIV-1 on cancer cells and launch the cell-killing agent into goal cells upon internalization. Ladiratuzumab vedotin may additionally trigger antitumor exercise by way of different mechanisms, together with activation of an immune response.

Extra on the deal within the Seattle Genetics press launch here.

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