Seattle Genetics awarded worldwide rights for its auristatin-based antibody-drug conjugate technology, with antibodies to several oncology targets, to Bayer HealthCare, in a collaboration designed to produce new cancer treatments, the companies said today.

Bayer agreed to pay up to $20 million in up-front and option exercise fees, plus up to about $500 million in payments tied to undisclosed milestones, and royalties on worldwide net sales of any products developed through the collaboration.

Bayer also agreed to oversee research, product development, manufacturing, and commercialization of all products under the collaboration, the second in less than a decade between the companies. Bayer and Seattle Genetics launched their first ADC collaboration in 2004.

“Antibody-drug conjugates are one of our focus areas in oncology research, and we are looking forward to strengthening our portfolio in this area of personalized medicine through the collaboration with Seattle Genetics,” Prof. Andreas Busch, member of the Bayer HealthCare executive committee and head of global drug discovery, said in a statement.

Seattle Genetics’ ADC technology uses synthetic cytotoxic agents and stable linker systems that attach the agents to antibodies. The linker systems are designed to be stable in the bloodstream and release the potent cell-killing agent once inside targeted cancer cells, with the goal of sparing nontargeted cells, thus reducing many toxic effects of traditional chemotherapy while enhancing antitumor activity.

Natasha Hernday, vp, corporate development at Seattle Genetics, said in the statement that her company has more than 15 ADCs in clinical development using its technology across internal and collaborator programs.

“We have the potential to receive more than $3.5 billion in future milestones plus royalties from these strategic alliances,” Hernday said.

Those alliances include ADC co-development agreements with the Astellas affiliate Agensys and Genmab, as well as collaborations with AbbVie, Bayer, Celldex, Daiichi Sankyo, Genentech, GlaxoSmithKline, Millennium, Pfizer, and Progenics, in addition to Agensys.

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