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What The Bristol-Myers Squibb Deal For NKTR-214 Entails?

|About: Nektar Therapeutics (NKTR), Includes: BMY
Summary

Nektar and Bristol-Myers Squibb (“BMY”) entered into a key collaboration partnership for NKTR-214 (BMY to pay Nektar $1.85B in upfront payment).

Companies to co-develop NKTR-214 in combinations with (Opdivo and Opdivo plus Yervoy) for over 20 cancers indications.

This is an abbreviated version of the in-depth Integrated BioSci Research available in advance to our marketplace subscribers.

On Feb. 14, 2018, the shares of Nektar Therapeutics (NASDAQ:NKTR) - a bioscience that focuses on the innovation and launch of novel medicines to service cancer, autoimmune disease, and chronic pain - traded $8.35 (+11%) higher at $84.01. This is due to the announcement that the company is in a collaborative deal with Bristol-Myers Squibb (NYSE:BMY) for the co-development and commercialization of the lead molecule NKTR-214 (a CD-122 agonist). Notably, the aforesaid runup is only part of the substantial value creation that Nektar is delivering (for both shareholders and patients alike). As follows, the stock procured over 346% profits for subscribers of Integrated BioSci Investing. In this research, we’ll elucidate the BMY deal (and to reaffirm our investing thesis on Nektar).

Figure 1: Nektar stock chart. (Source: StockCharts).

About The Company

The San Francisco, California-based firm leverages on its proven chemistry platform to design novel drugs (as shown in figure 2). We noted that the “honeycomb” of Nektar is its global leadership in polymer chemistry that, in and of itself, is a powerful therapeutic designing tool. In exploiting the structural adeptness of polymers, Nektar can customize the behavior of drugs (to a great extent). And, the targeting of well-characterized pathways enabled its innovation efforts to have the best chances of yielding meaningful clinical benefits.

Partnership For NKTR-214

Since our last publication, Nektar now secured the ideal partner (BMY) to co-develop NKTR-214. To realize its promising prospects, the partnership to develop NKTR-214 in combinations with nivolumab (Opdivo) and Opdivo plus ipilimumab (Yervoy) in 20 cancer indications for nine different tumors - melanoma, renal cell carcinoma (“RCC”), non-small cell lung cancer, bladder, and triple negative breast cancer. The anticipated timeframe for the commencement of the pivotal studies in RCC and melanoma is in the middle of this year.

Re the deal specificities, BMY will have the exclusive rights to the aforesaid conditions for an undisclosed specified period of time. Nektar to book revenues for the worldwide sales of NKTR-214 and reserved the rights to develop NKTR-214 with other anticancer agents (as shown in figure 2 above). Nektar and BMY to receive 65% and 35% of sales respectively. And, BMY to pay Nektar $1.85B in upfront payment - $1B in cash and the $850M from the purchasing of Nektar’s stock (roughly 8.28M shares at $106 per share). The development costs will be split 78% and 22% for BMY and Nektar, correspondingly.

The aforementioned collaboration is based on the phase 1/2 PIVOT clinical study of the CD-122 agonist, NKTR-214. The molecule works by stimulating the key cancer-fighting cell (T-cells and natural killer cells) as well as increase PD-1 expression on those immune cells. 

Final Remarks

Of notes, we went over this analysis in much greater details with specific recommendations on Nektar in the Integrated BioSci Research for your subscribers. In the said paper, we went over the upcoming catalysts for Nektar that can move the share price substantially north.

Author’s Notes: We’re honored that you took the time out of your busy day to read our market intelligence. Founded by Dr. Hung Tran, MD, MS, CNPR, (in collaborations with Dr. Tran BioSci analyst, Ngoc Vu, and other PhDs), Integrated BioSci Investing (“IBI”) marketplace research is delivering stellar returns since inceptions. To name a few, Nektar Therapeutics (NASDAQ:NKTR) procured more than 346% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 177% gains; Kite Pharma netted 82%; Atara Biotherapeutics (NASDAQ:ATRA) appreciated +245%. Crispr Therapeutics (NASDAQ:CRSP) garned plus 105%.  Exelixis Inc (NASDAQ:EXEL) earned greater than 63% capital appreciation. Our secret sauce is extreme due diligence coupled with expert data analysis. The service features a once-weekly exclusive in-depth Integrated BioSci Alpha-Intelligence article (in the form of research, reports, or interviews), daily individual stocks consulting, and model portfolios.

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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.