Seattle Genetics signed separate cancer-related deals with Agensys and Genentech. The exclusive worldwide license agreement with Genentech involves the development and commercialization of SGN-40, which is a humanized Mab in Phase I and Phase II trials for multiple myeloma, chronic lymphocytic leukemia, and non-Hodgkin's lymphoma.
Under the terms of the agreement, Seattle Genetics will receive an upfront payment of $60 million, potential milestone payments exceeding $800 million, and escalating double-digit royalties on annual net sales. The milestone payments include $20 million in committed payments during the first two years of the agreement. Genentech will fund future research, development, manufacturing, and commercialization costs. Seattle Genetics will continue certain Phase I and Phase II trials and development activities, also funded by Genentech. Seattle Genetics also has an option for co-promotion rights on SGN-40 in the U.S.
The collaboration with Agensys includes joint research, development, and commercialization of antibody-drug conjugate (ADC) therapies for cancer. It will encompass combinations of Seattle Genetics' ADC technology with antibodies developed by Agensys to proprietary cancer targets. Seattle Genetics' ADC technology employs linkers and synthetic, highly potent drugs. The linkers are stable in the bloodstream and release the drug payload once inside target tumor cells.
According to the transaction, Seattle Genetics and Agensys will jointly screen and select ADC products to an initial preselected target, co-fund all preclinical and clinical development, and share equally in any profits. Agensys will also conduct further preclinical studies aimed at identifying ADC products to up to three additional targets. Seattle Genetics has the right to exercise a co-development option on one of these products on the same 50:50 cost- and profit-sharing basis. Seattle Genetics will receive fees, milestones, and royalties on ADC products developed and commercialized solely by Agensys. Either party may opt out of co-development and profit-sharing in return for receiving milestones and royalties from the continuing party.