Celgene deepens its Agios ties with an $80M option deal

Agios CEO David Schenkein

Celgene ($CELG) is expanding its relationship with biotech partner Agios Pharmaceuticals ($AGIO), partnering on another preclinical cancer candidate in a 50-50 deal.

The Big Biotech is $10 million up front and promising up to $70 million more to get a share of AG-881, a small-molecule treatment that, like the rest of Agios' pipeline, targets cancer metabolism with the goal of killing tumors. In preclinical studies, the therapy has successfully traversed the thorny blood-brain barrier and found its way to cancers expressing certain mutations. With Celgene in tow, Agios expects to get the treatment into clinical trials next quarter.

Under the deal, the pair will split development costs and eventual profits down the middle, with Celgene handling global sales while Agios runs the books in the U.S.

The arrangement marks the third tie up between the two companies, broadening a relationship that began in 2010 with a $120 million deal for the cancer-treating AG-221. The pair have since teamed up on AG-120, which also targets tumors with so-called IDH mutations, plotting to get both into pivotal studies over the next two years.

"We believe the addition of AG-881, given its unique profile, provides added flexibility to our portfolio of IDH inhibitors," Agios CEO David Schenkein said in a statement. "Based on our preclinical findings, it has the potential to support our ongoing development effort to provide treatment options to patients with glioma, and it represents a possible second-generation molecule for both AG-221 and AG-120 in IDH-mutant tumors."

Agios, a 2009 Fierce 15 honoree, has been rolling since pulling off a $106 million IPO in the early days of biotech's protracted boom on Wall Street. And Celgene, a prolific dealmaker, has repeatedly affirmed its faith both in Agios' platform technology and Schenkein's pioneering approach to drug development in oncology.

- read the statement

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