A strategic business decision is causing shares of Agios Pharmaceuticals, Inc. (NASDAQ: AGIO) to rise dramatically on US stock charts. As of the last check during current-market session, AGIO shares has gained 20.86%, trading up at $38.07.
Contract For Strategic Royalty
Agios Pharmaceuticals (AGIO) has struck a significant agreement to sell Royalty Pharma the right to a 15% royalty on future net sales of vorasidenib from Servier in the US. According to the agreement, Agios will get $905 million in cash when vorasidenib is approved by the FDA.
After that, Royalty Pharma will get a 15% royalty on vorasidenib net sales in the United States up to $1 billion yearly, and a 12% royalty on sales beyond that amount. Agios will keep a 3% royalty on net sales over $1 billion in the United States each year.
Vorasidenib, an oral selective dual inhibitor that targets the mutant isocitrate dehydrogenase 1 and 2 enzymes, is highly brain penetrant and targets IDH-mutant diffuse glioma. Vorasidenib was part of the cancer portfolio that Agios sold to Servier in 2021.
Following vorasidenib’s FDA clearance, this divestment entitles Agios to a $200 million milestone payment and a 15% royalty on U.S. net sales. According to Servier, the FDA has scheduled August 20, 2024, as the Prescription Drug User Fee Act (PDUFA) action date.
Future Prospects And Financial Plan
Agios Pharmaceuticals is well-positioned for a number of impending catalysts that have the potential to improve patient outcomes and increase shareholder value. While preserving long-term value, Agios now has significant financial flexibility because to the recent acquisition with Royalty Pharma.
This collaboration is a reflection of our shared excitement about vorasidenib’s potential. The financial independence gained from this agreement will enable Agios to prepare for the anticipated launches of PYRUKYND (mitapivat) in thalassemia and sickle cell disease.
Furthermore, Agios aims to build a multi-billion-dollar PK activation franchise and expand its pipeline through both internal innovations and external acquisitions.
