In­cyte $IN­CY has just inked a $900 mil­lion deal to grab glob­al rights to an ear­ly-stage PD-1 check­point now be­ing de­vel­oped at Macro­Gen­ics.

Hervé Hop­penot

The two com­pa­nies an­nounced Wednes­day morn­ing that In­cyte will pay $150 mil­lion in a cash up­front for the de­vel­op­ment and com­mer­cial­iza­tion rights to MGA012, with Macro­Gen­ics hang­ing on to rights for run­ning com­bi­na­tion stud­ies us­ing their pipeline can­cer drug as­sets.

The deal in­cludes $420 mil­lion in de­vel­op­ment mile­stones along with $330 mil­lion for com­mer­cial goals. Roy­al­ties will stretch from 15% to 24%.

In­vestors liked it, dri­ving up Macro­Gen­ics’ shares $MGNX by 18% in the mid-af­ter­noon.

The PD-1 ther­a­py is cur­rent­ly in Phase I be­ing test­ed as a monother­a­py in four dif­fer­ent tu­mor types. And the first da­ta cut from the dose es­ca­la­tion study is due to go pub­lic in a cou­ple of weeks at the SITC meet­ing in Wash­ing­ton, DC.

“We do see the unique­ness of the deal in com­mer­cial­iz­ing the com­bi­na­tion prod­ucts,” says Macro­Gen­ics CEO Scott Koenig. This way the PD-1 can be a “back­bone” ther­a­py at both com­pa­nies, the two ex­ecs add, go­ing in­to a broad set of com­bi­na­tion tri­als with re­searchers at In­cyte and Macro­Gen­ics pur­su­ing their in­di­vid­ual ob­jec­tives — with­out get­ting in each oth­er’s way.

In­cyte is wide­ly viewed as the leader in the IDO1 field now, with piv­otal da­ta com­ing up for epaca­do­stat. Al­ready part­nered with Mer­ck and Bris­tol-My­ers Squibb in com­bi­na­tion tri­als us­ing their check­points, In­cyte clear­ly sees val­ue in hav­ing their own PD-1 to use for com­bos.

The deal comes two years af­ter In­cyte grabbed a pact with Chi­na’s Jiang­su Hen­grui Med­i­cine for an an­ti-PD-1 drug dubbed SHR-1210. In ex­change for $25 mil­lion up­front and a heav­i­ly back end­ed $770 mil­lion pack­age of mile­stones — in­clud­ing a $150 mil­lion bonus if the treat­ment can prove its su­pe­ri­or­i­ty — In­cyte CEO Herve Hop­penot got all glob­al rights out­side of Chi­na and re­lat­ed ter­ri­to­ries.

That drug, Hop­penot tells me to­day, was linked to a unique and mild side ef­fect — grade 1 and 2 he­man­giomas, small, non-can­cer­ous vas­cu­lar skin growths — that made it un­ap­peal­ing for com­bi­na­tion work in a high­ly com­pet­i­tive field, forc­ing the switch to Macro­Gen­ics as a new part­ner.

Koenig adds that Macro­Gen­ics is scal­ing up new man­u­fac­tur­ing ca­pa­bil­i­ty that they will use to sup­ply the PD-1, of­fer­ing an­oth­er com­mer­cial ad­van­tage for the biotech.

“An­ti-PD-1 ther­a­py is be­com­ing a main­stay of can­cer treat­ment across mul­ti­ple tu­mor types, and we be­lieve the ad­di­tion of MGA012 to our clin­i­cal pipeline is im­por­tant to ful­fill­ing our long-term de­vel­op­ment strat­e­gy in im­muno-on­col­o­gy. This col­lab­o­ra­tion with Macro­Gen­ics will al­low us to rapid­ly ex­plore the po­ten­tial clin­i­cal ben­e­fit of de­vel­op­ing MGA012 as a monother­a­py and al­so com­bin­ing an­ti-PD-1 ther­a­py with sev­er­al of our ex­ist­ing port­fo­lio as­sets,” said Steven Stein, chief med­ical of­fi­cer of In­cyte.

The FDA’s Oncology Center of Excellence has been a bright spot within the agency in terms of speeding new treatments to patients. That flexibility was on full display this morning as FDA released new draft guidance spelling out exactly how oncology drug developers can fulfill both the accelerated and full approval’s requirements with just a single randomized controlled trial.

While Congress recently passed legislation that will allow FDA to require confirmatory trials to be recruiting and ongoing prior to granting an accelerated approval, the agency is now making clear that the initial trial used to win the AA, if designed appropriately, can also serve as the trial for converting the accelerated approval into a full approval.

US regulators cleared an ultra-rare drug from Pharming Group, by way of Novartis, on Friday afternoon.

The Dutch biotech said the FDA greenlit leniolisib for an immunodeficiency disease known as activated phosphoinositide 3-kinase delta (PI3Kδ) syndrome, or APDS. People 12 years and older can receive the oral drug, to be marketed as Joenja, beginning early next month, Pharming said, five days ahead of the decision deadline set by the FDA as part of a priority review.