Shares of Fate Therapeutics were up more than 21% in premarket trading after the company announced a multi-billion dollar deal with Janssen Biotech to develop cell therapies for the treatment of cancer.
The partnership will leverage San Diego-based Fate Therapeutics’ induced pluripotent stem cell (iPSC) product platform and Janssen’s proprietary tumor-targeting antigen binders to create novel CAR NK and CAR T-Cell product candidates that will be developed against up to four tumor-associated antigens for hematologic malignancies and solid tumors. Fate will advance the different candidates through preclinical studies to the point of the filing of an Investigational New Drug Application with the U.S. Food and Drug Administration. When that time comes, Janssen will have the right to exercise its option for an exclusive license for the development and commercialization of collaboration candidates targeting the tumor-associated antigens.
Fate’s iPSC platform enables mass production of off-the-shelf, engineered, homogeneous cell products that can be administered with multiple doses, according to the company. The company’s approach involves engineering human iPSCs in a one-time genetic modification event and selecting a single engineered iPSC for maintenance as a clonal master iPSC line. Analogous to master cell lines used to manufacture biopharmaceutical drug products such as monoclonal antibodies, clonal master iPSC lines are a renewable source for manufacturing cell therapy products which are well-defined and uniform in composition, can be mass-produced at significant scale in a cost-effective manner, and can be delivered off-the-shelf for patient treatment, the company said.
Under terms of the agreement, Fate will receive $50 million in upfront cash, as well as a $50 million equity investment by Janssen. Janssen will also cover the funding costs of the R&D of the collaboration candidates. Once Janssen takes over the program, Fate will then be eligible to receive payments of up to $1.8 billion upon the achievement of development and regulatory milestones and up to $1.2 billion upon the achievement of commercial milestones. Fate will also be eligible to receive double-digit royalties on worldwide commercial sales of products targeting the antigens. Additionally, Fate has the right to co-commercialize the candidates should they be approved and share equally in profits and losses, the company said in its announcement.
Scott Wolchko, president and chief executive officer of Fate Therapeutics, touted the partnership with Janssen. He said the collaboration combines Janssen’s “deep domain expertise in oncology,” along with their proprietary technologies for targeting and binding certain tumors with Fate’s iPSC product platform to develop novel off-the-shelf CAR NK and T-cell cancer immunotherapies.
“The collaboration strengthens our financial and operating position through a focused effort of developing cell-based cancer immunotherapies utilizing Janssen’s proprietary antigen-binding domains while enabling us to continue to exploit our deep pipeline of wholly-owned product candidates and further develop our off-the-shelf, iPSC-derived cell-based immunotherapies,” Wolchko said in a statement.