EnteroMedics Inc (NASDAQ: ETRM) is having an overwhelmingly strong start to the trading session today, and for good reason. In an SEC filing, the company disclosed a collaboration agreement. Of course, this led to excitement among investors, causing gains and prompting our friends at Trade Ideas to alert us to the movement. At the moment (9:31), ETRM is trading at $4.90 per share after a gain of $0.56 per share or 12.76% thus far today.
ETRM Enters Into Collaboration Agreement With Galvani Bioelectronics
As mentioned above, EnteroMedics is having a strong day in the market today after releasing an SEC filing that updated investors with regard to a new collaboration agreement. According to the filing, the company entered into an agreement with Galvani Bioelectronics Limited.
Under the terms of the agreement, ETRM will modify its vBloc system for use in pre-clinical research by Galvani. As a result, the company will receive payments for its development work and supply. It’s also important to note that ETRM will retain all rights, title, and ownership in the intellectual property of the new device. From there, the new device will be licensed to Galvani. Under the terms of the agreement, Galvani will have first negotiation rights for potential exclusive as well as non-exclusive supply by EnteroMedics of the developed device.
This is a clear indication of the opportunities that ETRM may have with regard to leveraging their IP portfolio, opening the door to third party sales and licensing opportunities.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will be keeping a close eye on ETRM. In particular, we’re interested in following the progress of this collaboration agreement and excited to see the doors that this agreement opens. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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