The Gilead Sciences deal, which include $135 million in upfront and near-term payments, marks a critical platform validation for Vir Biotechnology as investors await an upcoming readout in solid tumors.
Gilead Sciences has helped bolster the appeal of Vir Biotechnology’s T cell engager technology with a new licensing deal that includes $135 million in upfront and near-term payments—including an equity stake—and could tack on an additional $1.74 billion in milestones.
The upfront payment includes $90 million split between a $65 million cash payment and a $25 million equity stake for Gilead. Another $45 million will be paid out in near-term preclinical milestones, according to Vir’s Wednesday press release.
For its investment, Gilead will gain access to three dual-masked T cell engagers (TCEs) for solid tumors developed using Vir’s PRO-XTEN masking technology. Vir will conduct discovery before handing over development of any promising assets to Gilead.
Vir’s pipeline is anchored in hepatitis delta, with the company currently testing a combo of elebsiran and tobevibart in Phase 3. The biotech also has a variety of assets for the treatment of solid tumors in Phase 1. Vir partnered with Astellas earlier this year seeking to monetize its drug discovery engine. The Astellas deal focused on a single asset called VIR-5500 for prostate cancer.
With the Gilead deal, H.C. Wainright sees Vir’s plan paying off and sending a bigger message to potential partners.
“We view this second partnership as incremental external validation of Vir’s ability to monetize its oncology platform beyond a single clinical asset,” the firm wrote on Wednesday morning. The Gilead deal includes “attractive headline economics” for Vir, the firm added, while Gilead will shoulder the development burden.
H.C. Wainright noted, however, that Wednesday’s deal does not include new clinical evidence or identify specific targets. “We therefore view the transaction as strategic and financial validation rather than a basis to increase clinical probabilities of success.”
For more clinical validation, investors will need to wait for data from the Phase 1 ECLIPSE2/3 trial of VIR-5818 in HER2-targeted solid tumors, the firm said. A readout is expected sometime before the end of the year.
The company is expected to begin seeing revenue from the hepatitis and cancer programs in the early 2030s, H.C. Wainright said.
While Vir’s shares were steady on Wednesday morning at $10.58 apiece, the stock has risen 75% year to date.
