Pieris Pharmaceuticals (PIRS) Stock Climbs On Collaboration News

Pieris Pharmaceuticals Inc (NASDAQ: PIRS) is headed for the top in the market this morning after announcing that it has entered into a collaboration with Genentech. Here’s what’s going on:

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PIRS Stock Climbs On Collaboration With Genentech

In the press release, Pieris Pharmaceuticals said it entered into a multi-program research collaboration and license agreement with Genentech, a member of the Roche Group. The collaboration surrounds the discovery, development, and commercialization of locally delivered respiratory and ophthalmology therapies that leverage the company’s proprietary anticalin technology. 

PIRS went on to explain that the collaboration will enable it to combine its robust discovery engine with Genentech’s targets, as well as its preclinical and clinical development expertise. As a result, the two will work together to create novel therapies for the treatment of respiratory and other ophthalmological diseases. 

Importantly, these two focus areas of the collaboration are uniquely suited to the advantages offered by the small size of Anticalin proteins when delivered locally. 

As part of the agreement, Pieris Pharmaceuticals will receive an upfront payment of $20 million and will be eligible to receive more than $1.4 billion in additional milestone payments across multiple programs. The company will also be eligible to receive tiered royalties for commercialized programs. 

In exchange, PIRS will be responsible for discovery and early preclinical development of the programs. Genentech will be responsible for IND-enabling activities, clinical development, and commercialization of the programs. Moreover, Genentech will have the option to select additional targets in return for an option exercise fee. 

Management Commentary

In a statement, Stephen S. Yoder, President and CEO at PIRS, had the following to offer:

We look forward to working closely with Genentech on the development of new inhaled and ophthalmological treatments based on the Anticalin platform. This collaboration further expands our partnered efforts in respiratory diseases and opens a new avenue for our Anticalin technology to potentially provide patient benefit through local biological effects. This is our second respiratory alliance with a major biopharma company, and we remain deeply committed to inhaled biologics, which have already shown benefit in the clinic. We also look forward to pursuing another local application of our technology in ophthalmology, where Genentech has extensive capabilities.

The statement above was followed up by James Sabry, M.D., Ph.D., Global Head of Pharma Partnering at Roche. Here’s what he had to offer:

Genentech has a longstanding commitment to understanding the underlying biology of respiratory and ocular diseases and translating this expertise into treatments for patients. We are excited to partner with Pieris Pharmaceuticals to advance potential new therapies that we hope could make a significant difference in the lives of people who need them.

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The Bottom Line

This news is huge! First and foremost, entering into a partnership with a company the size of Genentech comes with several advantages. Not to mention, the funding offered through this partnership will help to bolster Pieris Pharmaceuticals’ balance sheet. 

At the same time, none of the internal programs at the company are included in the partnership, meaning that everything that comes out of this collaboration will be a new revenue opportunity. 

All told, this is a great deal for the company, making PIRS a stock that’s well worth watching closely.