Gilead and Jounce Ink Potential $805 Million Immuno-Oncology Pact

Business Deal_Compressed

Gilead Sciences and Jounce Therapeutics entered a discovery and development deal to exclusively license Jounce’s JTX-1811 immuno-oncology program. JTX-1811 is a monoclonal antibody that selectively depletes immunosuppressive tumor-infiltration T regulatory (TITR) cells. Jounce’s shares exploded, climbing 70% at the news.

Under the terms of the deal, Gilead is paying Jounce $85 million upfront and acquiring $35 million in equity in the company. Jounce is eligible for an additional $685 million in so-called “bio-bucks,” meaning future clinical, regulatory and commercial milestone payments. Jounce is also eligible for high single digit to mid-teen royalties.

JTX-1811 targets CCR8, a chemokine receptor enriched on TITR cells. When JTX-1811 binds to CCR8, it depletes TITR cells by enhancing antibody-dependent cellular cytotoxicity mechanisms.

“We are very pleased to add, upon closing of the transaction, JTX-1811 to our pipeline of investigational immuno-oncology therapies that have the potential to transform care for patients with cancer,” said William A. Lee, executive vice president of Research at Gilead. “JTX-1811 is complementary to our other oncology candidates and has the potential to be first in a new class of therapies as a treatment for people with both solid tumors and hematological malignancies.”

Jounce will handle development of JTX-1811 through Investigational New Drug (IND) clearance, which they believe is on track for the first half of 2021. At that point, Gilead will have the sole right to develop the drug.

In July 2019, Jounce signed a worldwide licensing deal with Celgene for JTX-8064, a potential first-in-class antibody that targets the Leukocyte Immunoglobulin Like Receptor B2 (LILRB2) on macrophages. Then, in June 2020, after Bristol Myers Squibb acquired Celgene, they cut the product loose, along with any potential milestone payments. That deal was a blow, because it had the potential of totaling $2.6 billion.

Although this deal with Gilead isn’t quite as big, it’s a start and the equity investment by Gilead is a good indication of the pharma giant’s confidence in Jounce’s potential.

“Gilead’s investment in Jounce and, specifically, JTX-1811 reinforces the value of our Translational Science Platform and differentiated and sustainable approach to novel immuno-oncology programs, focused on patients with cancer who have yet to benefit from immunotherapy. We look forward to seeing JTX-1811 progress to the clinic,” said Richard Murray, chief executive officer and president of Jounce. “Our mission to deliver the right immunotherapy to the right patient population for meaningful and long-lasting benefit remains at the core of our discovery and clinical development work. Our JTX-1811 program is a prime example of these efforts.”

Jounce currently has four development-stage programs. Vopratelimab is a monoclonal antibody being evaluated in the EMERGE Phase II trial and Jounce also plans to launch an additional Phase II predictive biomarker trial using TISvopra for patient selection, SELECT. JTX-4014 is a PD-1 checkpoint inhibitor intended for use in combination with the SELECT trial and with Jounce’s broader pipeline. As mentioned above, JTX-8064 is a LILRB2 receptor antagonist. The company is planning to enter it into the clinic this year. And, of course, JTX-811.

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