Update: The company has inked a license and collaboration deal with Johnson & Johnson's (NYSE:JNJ) Janssen Pharmaceuticals to exclusively develop and commercialize RNAi therapeutic ARO-HBV for the treatment of chronic HBV infection.
Under the terms of the agreement, Arrowhead will receive $175M upfront, up to $1.6B in milestones and up to mid-teens royalties on net sales. It will also be eligible to receive up to $1.9B in option and milestone payments related to three additional targets.
The transaction should close this quarter.
Trading will resume at 7:50 am ET.
Update: In a shining example of the frustrating nature of biotech investing, shares are down 8% after being up almost 30% shortly after the open.
Update: Under the terms of the agreement, Janssen will be wholly responsible for clinical development beyond ARWR's ongoing Phase 1/2 study.
Concurrently, ARWR entered into an agreement with Johnson & Johnson Innovation - JJDC under which the latter will purchase 3,260,869 shares of ARWR common stock at $23 per share in a private transaction.
Investors are behaving as if the deal significantly undervalues ARWR's most prized asset. Shares are down 18% on more than an 8x spike in volume in the last hour of the session.
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