Biogen to pay $124 million to Applied Genetic Technologies Corp. to develop Gene-based Therapies for Eye Diseases
Biogen Inc. will pay $124 million to Applied Genetic Technologies Corp. for getting license and commercialization rights for its gene-based therapies, as the former is making its entry into the eye-disease treatment.
After the announcement, shares of AGTC increased 21% amounting to $19.75, but not much change was noticed in the shares of Biogen. They were little changed at $406.08. While detailing about the deal, Biogen, which is a leader in treatments for multiple sclerosis, said that the amount also includes a $30 million equity investment.
AGTC will also receive milestone payments and royalties totaling more than $1 billion. The total includes up to $472.5 million for the two programs and rest of the amount will be from payments for the discovery programs.
The two lead programs are a treatment for disease known as X-linked Retinoschisis and the second treatment is for X-Linked Retinitis Pigmentosa. Both the diseases can cause blindness in men.
AGTC Chief Executive Sue Washer is quite happy with the collaboration. He thinks that the union will, “support the development of new therapies that may allow for transformative treatments for these rare inherited eye diseases”.
AGTC is known for developing gene-therapy based treatments for eye disease. On the other hand, Biogen has been looking out for new products that will boost their sales, after having a successful 2013 launch of its multiple-sclerosis therapy Tecfidera.
Things did not go well in the latest quarter, as Tecfidera’s slow growth led to lower-than-expected profit and revenue growth.
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