Vical Incorporated VICL announced the expansion of its infectious disease portfolio with the in-licensing of antifungal candidate, ASP2397, from Astellas Pharma Inc. ALPMY. ASP2397 is being developed to address invasive Aspergillus infections, which are a major cause of morbidity and mortality in immunocompromised patients, including transplant recipients.
We note that Vical already has a licensing agreement with Astellas for the development and commercialization of another candidate, ASP0113, which is being developed for protection against infection caused after stem cell and solid organ transplants.
Under the terms of the new license agreement, Vical gained exclusive worldwide rights to develop and commercialize ASP2397. Astellas is to receive Vical common stock equivalent to approximately 1% of outstanding shares and $250 thousand in cash. Astellas can also receive up to $100 million as milestone payments and single-digit royalties on net sales. Vical said that its 2015 cash burn guidance of $12-15 million remains unchanged.
Vical intends to develop ASP2397 for the front-line treatment of invasive aspergillosis as well as a part of a combination regimen for the preemptive treatment of fungal infections. The company intends to initiate a phase I study on the candidate in the first half of 2016.
The Astellas deal is the second agreement to be announced by Vical this year. Earlier this year in January, the company had entered into an agreement with a Japanese biopharmaceutical company, AnGes MG, to develop and commercialize an equine polyclonal antibody therapy for patients suffering from Ebola.
Meanwhile, Vical’s pipeline includes a herpes simplex virus type 2 (HSV-2) vaccine, which is being evaluated by the company independently. The HSV-2 vaccine is being developed to reduce viral shedding and genital lesion recurrences in HSV-2 positive subjects. The vaccine is currently in a phase I/II study with top-line data expected by the middle of 2015.
Vical carries a Zacks Rank #2 (Buy). Some better-ranked stocks in the health care sector include Lannett Company, Inc. LCI and Cambrex Corp. CBM. Both companies sport a Zacks Rank #1 (Strong Buy).
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