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REGENXBIO (RGNX) Stock Up on Collaboration Deal With AbbVie

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REGENXBIO (RGNX - Free Report) announced that it is collaborating with pharma giant AbbVie (ABBV - Free Report) to co-develop and co-commercialize RGX-314, an investigational one-time gene therapy for the treatment of wet age-related macular degeneration (“wet AMD”), diabetic retinopathy (“DR”), and other chronic retinal diseases.

Per the agreement terms, REGENXBIO will receive $370 million as an upfront payment from AbbVie. The company will further be eligible to receive potential milestone payments up to $1.38 billion.

Following the collaboration, both REGENXBIO and AbbVie will share costs for future studies on RGX-314, including a second pivotal study for wet AMD utilizing subretinal delivery. REGENXBIO will be responsible for the ongoing clinical studies on RGX-314, which were taken up before the collaboration.

Shares of REGENXBIO gained 31.2% following the above-mentioned news. Yet, the stock has declined 1.7% so far this year in comparison with the industry’s 0.8% decline.

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REGENXBIO is currently evaluating RGX-314 in multiple clinical studies. The therapy is being evaluated in a pivotal study to treat wet AMD patients administered to the eye through a standardized subretinal delivery procedure. RGX-314 is also being evaluated in patients with wet AMD and DR in two separate phase II studies administered to the suprachoroidal space of the eye through a microinjector.

AbbVie will lead the clinical development and commercialization of RGX-314 globally. Once commercialized, both partners will share equal profits from U.S. sales of RGX-314, while REGENXBIO will receive tiered royalties on ex-U.S. sales.

RGX-314 is one of REGENXBIO’s many gene therapies that is developed using its proprietary adeno-associated virus (AAV) gene delivery platform. RGEX-314 consists of NAV AAV8 vector, designed to inhibit the vascular endothelial growth factor. The upfront payment from AbbVie will help fuel the company’s pipeline of other innovative gene therapies in clinical studies.

The retinal indication space is largely dominated by a few key players in the industry. Bayer (BAYRY - Free Report) /Regeneron’s (REGN - Free Report) blockbuster drug Eylea is a key revenue generator in the retinal indications space. Eylea is approved for the treatment of wet AMD, diabetic macular edema (DME) and macular edema following retinal vein occlusion.

Roche/Novartis’ drug Lucentis is also approved by the FDA for the treatment of wet AMD and all forms of DR in people with or without DME.

Zacks Rank

REGENXBIO currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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