Celgene will receive options to develop and commercialize jointly Jounce Therapeutics’ lead candidate JTX-2011 and other cancer immunotherapies through a collaboration that Jounce said today could generate for it more than $2.6 billion.

JTX-2011 is a monoclonal antibody that Jounce said is expected to enter clinical trials during the second half of this year. JTX-2011 is designed to work by binding to and activating the inducible T-cell co-stimulator (ICOS), a protein on the surface of certain T cells that is believed to stimulate an immune response against a patient’s cancer.

JTX-2011 is being developed to treat solid tumors as a single agent and in combination with other therapies, Jounce said. Jounce presented positive preclinical data on the lead candidate in April at the American Association of Cancer Research (AACR) Annual Meeting 2016 in New Orleans.

In addition to JTX-2011, Celgene will gain options from Jounce for up to four of its early-stage programs to be selected from a defined pool of B-cell, regulatory T-cell, and tumor-associated macrophage targets emerging from the Jounce Translational Science Platform. The platform is designed to deliver personalized medicine by prioritizing targets and identifying related biomarkers tailored to patients.

Celgene will also receive an additional option to share a checkpoint immuno-oncology program equally with Jounce.

Upon Celgene exercising its options, it will lead global development and U.S. commercialization for JTX-2011, as well as one additional collaboration program.

The collaboration spells out the companies’ shares of U.S. profits and losses on all programs once Celgene opts in at defined stages of development:

  • For JTX-2011, Jounce will retain a 60% U.S. profit share, with Celgene receiving the remaining 40%.
  • For the first additional innumo-oncology program, Celgene will receive 75% of U.S. profits, with Jounce retaining the remainder.
  • On up to three additional programs, Jounce and Celgene agreed to equally share U.S. profits.

After opt-in, all development costs will be shared “in a manner that is commensurate with product rights,” Jounce said.

Celgene will also receive exclusive ex-U.S. commercialization rights for each of the programs, while the companies will equally share profits globally for the checkpoint program.

In return for the option rights and profit shares, Celgene agreed to pay Jounce $225 million upfront, make a $36 million equity investment in Jounce, and pay Jounce up to an additional $2.3 billion in payments tied to achieving development, regulatory and commercial milestones.

Jounce is also eligible for tiered royalties on sales outside the U.S.

Launched in 2013 with $47 million in Series A funding from Third Rock Ventures, Jounce completed an oversubscribed $56 million Series B financing last year.

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