Immunomedics, Inc.’s (IMMU) share price continued to fall following the company’s announcement regarding the receipt of a termination notification from Takeda Pharmaceutical Company (TKPYY). Shares have declined 8.2% since the announcement.
Last week, Immunomedics had received a notification from Takeda regarding the termination of a licensing agreement between Nycomed, a wholly-owned subsidiary of Takeda, and Immunomedics. Immunomedics had exclusively licensed its pipeline candidate, veltuzumab (in the subcutaneous formulation), to Nycomed for the treatment of all non-cancer indications worldwide.
Immunomedics had started arbitration proceedings against Nycomed related to delays in the development of veltuzumab. According to Immunomedics, the delays represented a material breach of the licensing agreement.
With the agreement being terminated, Immunomedics has regained all rights to veltuzumab. The companies are in discussions regarding the transition of veltuzumab back to Immunomedics. Meanwhile, the arbitration proceedings will continue for damages.
The first autoimmune disease indication for which veltuzumab was being investigated is immune thrombocytopenia. As far as oncology is concerned, Immunomedics has completed an open-label, multicenter, phase I/II trial using the subcutaneous formulation of veltuzumab in non-Hodgkin’s lymphoma and chronic lymphocytic leukemia. Following the termination of the agreement, Immunomedics is evaluating its options for the candidate.
Going forward, we expect investor focus to remain on the company’s lead pipeline candidate, epratuzumab, which is currently in two phase III studies in lupus. Meanwhile, another candidate, clivatuzumab, is scheduled to move into a pivotal phase III study in advanced pancreatic cancer patients.
Immunomedics currently carries a Zacks Rank #4 (Sell). At present, companies like Actelion Ltd. (ALIOF) and Isis Pharmaceuticals (ISIS) look attractive. Both are Zacks Rank #1 (Strong Buy) stocks.
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