Novartis AG (ADR) (NYSE: NVS)
Novartis is working to strengthen its immunotherapies pipeline. Today, the company announced two big moves it’s making to do just that. The plans include the acquisition of Admune Therapeutics as well as a large licensing agreements with Palobiofarma and XOMA Corp (NASDAQ: XOMA). Today, we’ll talk about the agreements NVS has made with both of these companies, how the market is reacting to the news and what we can expect to see moving forward.
Admune Therapeutics Acquisition
First and foremost, NVS will acquire Admune Therapeutics. In doing so, the company will strengthen its immunology portfolio thanks to the companies IL-15 agonist program. The program is currently in Phase 1 clinical trials and expected to prove to be a positive treatment for metastatic cancer.
NVS Signs 2 Licensing Agreements
The first licensing agreement signed is with Palobiofarma. This agreement provides Novartis with both development and commercialization rights to PBF-509. PBF-509 is an adenosine receptor antagonist that is currently in the midst of Phase 1 clinical trials for the treatment of non-small cell lung cancer.
Novartis also signed an agreement with XOMA Corp. The purpose for this agreement was to give NVS exclusive development and commercialization rights with regard to TGF-beta antibody programs. These programs are designed as monotherapies, however, there will be tests to see if these programs work well in combination with therapies provided by NVS in the immuno-oncology space. In a statement, Mark Fishman, President of the Novartis Institutes for BioMedical Research had the following to say…
“The first wave of immuno-oncology therapies has demonstrated the impact this approach can have on treating certain types of tumors… To realize its full potential requires exploration of the complex system of biological pathways in the tumor microenvironment with agents that can stimulate the immune system to attack a wider variety of tumors.”
How The Market Reacted To The News
It is still incredibly early in the trading session – 9:48 to be exact. In after hours trading, NVS fell. However, in the 18 minutes the market has been open, the stock has been working its way to the green line. Currently, NVS is trading at $92.24 after a loss of 0.13% compared to the previous session’s close.
In the case of XOMA, investors are obviously excited about what they’re seeing here as the stock has started the day off on a strong note. Currently, XOMA is trading at $1.09 after a gain of 9%.
What We Can Expect To See Moving Forward
Moving forward, I’m expecting to see great movement from both NVS and XOMA. In the case of NVS, the moves announced today are huge for the development of their pipeline. Not only does this add new treatments all together, but the ability to combine treatments for opportunities to create even more new products. In the case of XOMA, the new agreement with NVS will help the company to realize gains from its TGF-beta antibody programs. All in all, both of these companies are likely to move positively.
What Do You Think?
Where do you think NVS and XOMA are headed and why? Let us know in the comments below!
[Image Courtesy of Bloomberg]