MacroGenics Wrangles Cancer Deal Worth $755 Million Out of Johnson & Johnson

Published: May 19, 2016

MacroGenics Wrangles Cancer Deal Worth $755 Million Out of Janssen Biotech May 18, 2016
By Mark Terry, Breaking News Staff

MacroGenics , headquartered in Rockville, Maryland, today signed a global oncology collaboration and license agreement with Janssen Biotech , a Johnson & Johnson company.

Janssen agrees to pay $75 million upfront, with potential clinical, regulatory and commercialization milestones that could hit $665 million. If commercialized, MacroGenics could receive double-digit royalties.

The collaboration deal uses MacroGenics’ Dual-Affinity Re-Targeting (DART) platform that simultaneously targets CD3 and an undisclosed tumor target for possible therapeutics to treat hematological malignancies and solid tumors. The specific product is MGD015, which is designed to redirect T cells, by way of their CD3 component, to attack specific cancer cells that overexpress an antigen that has not been disclosed. MacroGenics has shown that MGD015 can kill target cells in vitro and in vivo, and has shown high response rates in mouse tumor xenograft models.

“MGD015 is a promising product candidate that employs MacroGenics’ DART platform to enable a potent redirected T-cell killing mechanism with ‘off-the-shelf’convenience,” said Scott Koenig, MacroGenics’ president and chief executive officer, in a statement. “This approach is already being evaluated in five other clinical-stage DART programs. Janssen represents the ideal partner for MGD015, given its track record of successfully developing and commercializing transformative oncology therapies. This collaboration builds on an existing Janssen relationship around MGD011, a DART molecule targeting CD19 and CD3, which is now being evaluated in the clinic.”

That deal was signed in December 2014. At that time, Janssen paid MacroGenics a $50 million upfront licensing fee. J&J Innovation also repurchased 1,923,077 new shares of MacroGenics’ stock at $39 per share, totaling about $75 million.

Under that agreement, Janssen handled development of MGD011 after submission of the IND, which occurred in 2015. MacroGenics was eligible to receive up to another $575 million in various milestone payments. Janssen started a Phase I trial of MGD011 in July 2015.

The company also has a deal with Pfizer . On May 10, MacroGenics announced that its bispecific antibody therapeutic candidate, generated through its DART platform, had started Phase I trial of PF-06671008, which targets P-cadherin and CD3. That Phase I dosing triggered a $2 million milestone payment to MacroGenics under their October 2010 agreement.

In the company’s first-quarter financials reporting on May 4, MacroGenics provided an update on its pipeline. The SOPHIA study is a Phase III trial in patients with HER2-positive metastatic breast cancer for its margetuximab. The same compound is also in a Phase Ib/II gastric cancer study in combination with pembrolizumab.

Another candidate, enoblituzumab (MGA271) is in three studies, one as a monotherapy and two combination studies. MGD009, a DART molecule that targets B7-H3 and CD3, is in a Phase I study across multiple solid tumor types. Data on B7-H3, an antibody-drug conjugate, was presented at the American Association for Cancer Research (AACR) Annual Meeting in April.

MacroGenics has six DART molecules in Phase I development, including MGD006, MGD007, MGD011, MGD010, MGD009 and PF-06671008. It also indicated it plans to submit IND applications for two additional DART molecules in 2017: MGD013 and MGD014.

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