Celgene Corp. a US global pharmaceutical company is going to pay Impact Biomedicines, a young cancer drug development company was set up in 2016 and investigates the drug “Fedratinib” a potent and highly selective oral small molecule JAK2 kinase inhibitor, which is being developed initially for the treatment of myelofibrosis (MF) and polycythemia vera (PV).
The initial price that Celgene Corp. Will pay upfront is $1.1 billion, but if the research and development proceeds according to expectations, the overall cost can reach $7 billion. One such milestone is FDA approval for treating myelofibrosis. Myelofibrosis is a form of bone marrow cancer, and the Impact will get $1.25 billion at this milestone. Forever other indication that Impact gains for Fedratinib, they will earn $150 million. Another milestone will be $4.5 billion payable when Fedratinib sells more than $5 billion annually.
This is Celgene’s trial to escape the massive losses it felt when Revlimid, a Crohn’s disease drug developer failed to get positive late-stage trial results. As a result of this, Celgene cut its 2020 profit target, and its shares floundered.
The recent announcement has not yet impacted Celgene’s shares, and they are still being traded 28% below their 2017 peak in October, just before the Revlimid announcement.
Celgene CEO, Mark Alles stated that Celgene is now seeking outside investments to bolster its own lab developments.