Celgene, Sutro Biopharma broaden relationship with new agreement

Sutro and Celgene will work to develop multi-specific antibodies and ADCs; the agreement includes an option for Celgene to acquire Sutro

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SOUTH SAN FRANCISCO, Calif.—Biopharmaceutical company Sutro Biopharma has announced a strategic collaboration and option agreement with Celgene Corporation for the discovery and development of multi-specific antibodies and antibody drug conjugates (ADCs). The companies will use Sutro's cell-free biologics development platforms, Xpress CF and Xpress CF+, to explore immuno-oncology targets such as PD-1 and PD-L1 and novel targets. Per the terms of the agreement, after an initial period, Celgene will have an exclusive option to acquire Sutro, including rights to all programs Sutro owns at the time, under pre-specified terms. Celgene will pay Sutro $95 million in upfront payments, which includes an equity investment, and Sutro will also be eligible for up to an additional $90 million during the research term, including manufacturing-related and productivity milestone payments.
For its part, Celgene will have the option of extending the collaboration past its initial research term in exchange for an additional payment. Sutro stands to receive more than $1 billion in total payments across all product candidates if clinical and regulatory milestones are met, as well as royalties on sales of products resulting from the deal.
“Substantive progress and unique advantages of Sutro’s platform have led us to expand and extend our relationship, as a key capability supporting our emerging Immuno-Oncology pipeline. We see this collaboration as a unique opportunity to accelerate the evaluation and development of important products in this and other strategic areas of high potential impact. Sutro has been a strong partner expanding a potentially disruptive technology, and we look forward to building on the existing collaboration,” Thomas Daniel, M.D., Celgene president of global research and early development, said in a press release.
Sutro will be responsible for discovery and early preclinical development of all multi-specific antibodies and ADCs for the collaboration, as well as manufacturing of preclinical product candidates. The deal also suggests a clinical and commercial supply agreement between the partners for collaboration products. Celgene may take responsibility for global development and commercialization, with worldwide rights to all collaboration products, except certain ones for which Sutro will retain U.S. development and commercialization rights, should Celgene not exercise its acquisition option. For those products that aren't licensed to Celgene under the terms of the agreement, Sutro retains worldwide rights in the event Celgene chooses not to acquire Sutro.
“This multi-year collaboration agreement reflects Celgene’s commitment to our highly collaborative relationship, the significant progress we have made in exploring best-in class multispecific antibodies and ADCs using Sutro’s cell-free protein synthesis platform, and the value of our early pipeline of multispecific antibodies targeting immuno-oncology pathways,” William Newell, CEO of Sutro Biopharma, commented in a statement. “Our platform and product development efforts bear enormous promise. We look forward to continuing and expanding our productive collaboration with Celgene and to accelerating the development of our own portfolio of mono- and bi-specific ADC pipeline candidates.”
Celgene and Sutro have an ongoing business relationship, having established a collaboration in December 2012 that focused on designing and developing ADCs and bispecific antibodies for a pair of undisclosed targets and manufacturing a proprietary Celgene antibody. That agreement had a potential total value of more than $500 million for Sutro if all programs proved successful. Under the terms of the 2012 collaboration, Sutro was responsible for product design and production of preclinical materials.
SOURCE: Sutro Biopharma press release

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