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When Larger Firms Walk Away From Partnerships With Smaller Ones: How Bad Is The Damage?

AZN, BIIB, IBB, IRWD

Advaxis, Inc. (NASDAQ: ADXS) shares tumbled earlier this month on the heels of the termination of a licensing deal with Amgen, Inc. (NASDAQ: AMGN).

The licensing deal, initially signed in August 2016, pertains to the development and commercialization of Advaxis' ADXS-NEO program, a preclinical immunotherapy that activates a patient's immune system to respond against unique mutations or neoepitopes contained in and identified from an individual patient's tumor.

Advaxis' pipeline has five investigational immunotherapies targeting a range of cancer types.

The company faced another setback earlier this year when the FDA halted a combo study of its filolisbac and AstraZeneca plc (NYSE: AZN)‘s Imfinzi in patients with advanced, recurrent or refractory human papillomavirus, which is associated with cervical and head and neck cancer. The clinical hold was subsequently lifted.

Applied Genetic Falls On Terminated Deal

Applied Genetic Technologies Corp (NASDAQ: AGTC) announced after the close Dec. 12 the termination of its collaboration agreement with Biogen Inc (NASDAQ: BIIB), effective March 8. The news means that Applied Genetic regains full rights to the X-linked retinoschisis and X-linked retinitis pigmentosa programs and three other partnered discovery programs.

Applied Genetic slumped 47 percent Dec. 13 and has been in the red ever since.

Ironwood Makes Good On August Losses

Earlier this year, Ironwood Pharmaceuticals, Inc. (NASDAQ: IRWD) announced the termination of a licensing deal with AstraZeneca. Following an evaluation of its franchise, Ironwood said it ended the U.S. licensing deal for lesinurad, used to treat gout either as a monotherapy or in combination with allopurinol.

The stock fell over 4 percent Aug. 6, the day of the announcement; it reclaimed its pre-announcement levels by the end of the month.

The stock has not escaped the broader market sell-off seen since October and is now down by about 50 percent from its early October highs.

The Straw That Broke Oncomed's Back

Oncomed Pharmaceuticals Inc (NASDAQ: OMED) announced ahead of the market open Sept. 20 that it had been notified by Celgene Corporation (NASDAQ: CELG) of the termination of a licensing deal for the former's bispecific antibody navicixizumab.

The drug is an early stage candidate being evaluated in combination with paclitaxel for treating platinum-resistant, late-stage ovarian cancer.

Oncomed fell over 14 percent Sept. 20, and was on a downtrend over the next seven sessions before staging a modest rebound — only to head lower again along with the broader market in October.

In December, Oncomed announced a reverse merger with U.K.-based Mereo BioPharma.

A breakup is always heartbreaking, and the corporate equivalent is no less painful. The damage is more pronounced when the tie involves a bigger company and a smaller partner. 

Related Links:

Positive Data From Orchard Therapeutics Turns Goldman Sachs Bullish

Attention Biotech Investors: Mark Your Calendar For These December PDUFA Dates



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