Bristol-Myers Squibb Company (BMY - Free Report) announced that it has entered a clinical trial collaboration with Compugen (CGEN - Free Report) . Per the deal, the companies will evaluate the safety and tolerability of Compugen's COM701, an investigational antibody, in combination with Bristol-Myers' immune checkpoint inhibitor, Opdivo, in patients with advanced solid tumors.
Bristol-Myers also announced that it will make a $12-million equity investment in Compugen, purchasing 2,424,243 shares, which is equal to a 4.1% stake, at $4.95 each. The investment represents a 33% premium over the average closing price in the last 20 trading days and is expected to close on Oct 12. Shares of Compugen rose about 7% following the news. However, year to date, shares of Bristol-Myers have declined 6.1%, against the industry’s growth of 2.7%.
Compugen will sponsor an ongoing two-part early stage trial, which includes evaluating the combination of COM701 and Opdivo in four tumor types, including non-small cell lung, ovarian, breast and endometrial cancers. The collaboration is also designed to address potential future combinations.
With this collaboration, Compugen will have access to Bristol-Myers’ high profile drug, Opdivo, which will speed up the development process of COM701.
Notably, Opdivo is currently approved in several countries, including the United States, the EU and Japan for several cancer indications. Opdivo became the first PD-1 inhibitor to be approved for a hematological malignancy — classical Hodgkin lymphoma — in both the United States (May 2016) and the EU (November 2016).
Bristol-Myers is working on expanding the label of Opdivo further. The drug has been performing impressively due to demand resulting from the rapid commercial acceptance for several indications, including melanoma, renal cell carcinoma and second-line non-small-cell lung cancer (“NSCLC”). Label expansion to include additional indications would give the drug access to a higher patient population and increase its commercial potential significantly.
Bristol-Myers collaborated with several other research institutes, and small and large biotech and pharma companies, including Johns Hopkins University, Johnson & Johnson (JNJ - Free Report) , AbbVie (ABBV - Free Report) , Five Prime, Lilly, Celgene, Celldex, Nektar, Infinity Pharma and Seattle Genetics, for the evaluation of Opdivo in combination with their cancer treatments.
Bristol-Myers currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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