XOMA Corporation XOMA announced that it has signed a license agreement with Novo Nordisk A/S NVO, under which Novo Nordisk will acquire the global development and commercialization rights to the company’s XMetA program for the treatment of patient with diabetes.
Terms of the Agreement
XOMA is entitled to receive an upfront payment of $5 million from Novo Nordisk. In addition, the company is entitled to receive up to $290 million as additional potential development, regulatory and commercial milestones. Moreover, XOMA will receive tiered royalties on product sales. While XOMA retains commercialization rights for rare disease indications, Novo Nordisk has an option to add these rights to its license.
Our Take
XOMA’s decision to sell the XMetA program to Novo Nordisk will allow the company to focus on rare endocrine diseases. We remind investors that the company has been pursuing significant agreements in the past in order to meet its corporate strategy to develop novel therapeutics for endocrine diseases.
In early October, XOMA licensed global development and commercialization rights to its anti-transforming growth factor-beta (TGFb) antibody program to Novartis AG NVS for the treatment of cancer.
Currently, XOMA carries a Zacks Rank #2 (Buy) and Novo Nordisk carries a Zacks Rank #3 (Hold). A favorably placed stock in the health care sector is Achillion Pharmaceuticals, Inc. ACHN, sporting a Zacks Rank #1 (Strong Buy).
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