Agreement for mid-stage anticancer agent pushed Arqule’s stock up 14%.

After entering a binding letter of intent, Daiichi Sankyo will pay Arqule $60 million for rights to the company’s Phase II cancer drug, ARQ 197. Arqule’s value climbed 14% to open the day at $4.22.

The license, co-development, and co-commercialization agreement covers the U.S., Europe, South America, and the rest of the world excluding Japan, China, South Korea, and Taiwan, where Kyowa Hakko Kirin has exclusive rights for development and commercialization.

ARQ 197 is a selective c-Met inhibitor. The inking of this definitive agreement supersedes the binding letter of intent reported on November 10 covering this candidate.

On November 10, the two companies also entered an oncology discovery partnership. For $15 million upfront, Arqule agreed to use its kinase inhibitor discovery platform against two kinases. Daiichi Sankyo may license compounds that inhibit these targets after certain preclinical development activities.

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