Seattle Genetics has abandoned a potential $2 billion pact with Immunomedics after a shareholder revolt at the little New Jersey biotechnology company ousted its top executives.
Seattle Genetics has abandoned a potential $2 billion pact with Immunomedics after a shareholder revolt at the little New Jersey biotechnology company ousted its top executives.
Seattle Genetics, the largest local biotech, in February agreed to pay $250 million upfront to license a potential solid-tumor drug developed by Immunomedics. Future milestone and royalty payments could have pushed the total to $2 billion, the companies said.
But a proxy challenge to the board members of Immunomedics, driven by a large shareholder, led to a restraining order while the disputed election was sorted out.
The companies announced Friday that they had agreed to terminate their licensing agreement over the drug, known as IMMU-132.
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Simultaneously, Immunomedics said its founder and his wife, the CEO, have stepped down, and the company has raised $125 million to fund the drug’s development on its own. Immunomedics’ chief financial officer will serve as interim CEO.
Bothell-based Seattle Genetics said the termination and settlement agreement remain subject to court approval.
“The Immunomedics transaction would have effectively utilized our substantial expertise in antibody-drug conjugate (ADC) development to advance IMMU-132 for patients in need,” said Seattle Genetics President and CEO Clay Siegall.
“However, due to significant delays and lack of progress towards closing the deal, we are turning our full attention and resources to our promising pipeline and the substantial opportunities in front of us.”
Seattle Genetics will retain 3 million shares of Immunomedics common stock and a warrant to purchase another 8.7 million shares at $4.90 apiece.
Immunomedics shares jumped 17.56 percent Friday on the news, rising 95 cents for the day to close at $6.36. Seattle Genetics shares, meanwhile, closed down 3 percent at $61.82.