Agenus trades adjuvant rights to GSK for $115M to bolster oncology profile

Agenus CEO Garo Armen

Immunotherapy developer Agenus ($AGEN), looking to further invest in its immuno-oncology pipeline, plans to temporarily cash out of a deal with GlaxoSmithKline ($GSK) to grab $115 million in exchange for royalties it once held on an adjuvant for GSK's malaria and shingles vaccines.

Agenus is handing over the rights to its QS-21 Stimulon adjuvant, which is used with GSK's recently EMA-approved Mosquirix malaria vaccine and its as-yet-unapproved shingles candidate. In an uncommon financing deal, Agenus has taken out a $100 million loan from Oberland Capital at 13.5% interest. GSK will be the one paying off the debt, though, with the royalties it once would have been giving to Agenus. If GSK completes the payments, the rights go back to Agenus, but if the adjuvant doesn't perform as expected, Agenus will pay the rest of the debt. Agenus also stands to gain another $15 million if the shingles vaccine nets FDA approval.

Lexington, MA-based Agenus boasts a couple other large partnerships in Merck ($MRK)--worth $100 million--and Incyte ($INCY)--worth up to $410 million. And with about $210 million in net cash on hand, plus the $78 million it expects to take in from the loan, the company is looking to make strides in the immuno-oncology arena, where it has devoted much of its focus in the last few years.

In Prophage, Agenus has a midstage brain cancer vaccine that could be in Phase III by the end of this year and has more than doubled its market value in a short time after a key buyout of the company 4-Antibody, which provided a discovery platform, and those valuable partnerships with bigger players.

"We've been in this for 21 years," CEO Garo Armen told FierceBiotech. "As the Irish say, it's not for the faint-hearted. Twenty-one years is a long time, but now the pieces of the puzzle have come together for us."

- here's the statement
- and here's FierceBiotech's take