Agenus and Zydus Forge $141M Partnership, Transferring California Production Plants

Agenus, a biotech firm undergoing reorganization, has entered into a significant partnership with Indian drugmaker Zydus Lifesciences, transferring two California manufacturing facilities as part of a $141 million deal. The agreement aims to accelerate the development of Agenus' cancer combination therapy and expand its global reach.

Manufacturing Transfer and Financial Details

Agenus will receive $75 million in cash for its two California plants:

• A 25,000-square-foot facility in Berkeley, focused on clinical manufacturing
• An 83,000-square-foot plant in Emeryville, set up for commercial manufacturing

The deal also includes:

• Up to $50 million in contingent payments based on future production orders for the BOT/BAL combination
• Approximately $16 million from Zydus for the acquisition of 2.1 million Agenus shares at $7.50 per share

Strategic Implications and Development Plans

The partnership is designed to accelerate the development of Agenus' cancer combination therapy, botensilimab/balstilimab (BOT/BAL). Botensilimab is Agenus' CTLA-4 blocking antibody, while balstilimab is the company's PD-1 drug.

Sharvil Patel, Zydus' managing director, stated, "We plan to run clinical trials testing BOT/BAL in both early-stage and late-stage disease, along with expansion beyond colorectal cancer to other major disease settings like triple negative breast cancer."

Zydus intends to leverage the acquired U.S. facilities to launch its BioCDMO business, while Agenus will use the proceeds from the share sale for working capital and further development of BOT/BAL.

Regulatory Challenges and Company Reorganization

This deal comes in the wake of significant setbacks for Agenus:

• In July, the FDA halted Agenus' plan to file for accelerated approval of the BOT/BAL combo for treating relapsed/refractory microsatellite stable colorectal cancer based on phase 2 response data.
• In 2021, Agenus withdrew its application for balstilimab in cervical cancer treatment after Merck's Keytruda received an early expansion in the same indication.
• In 2023, Agenus reduced its workforce by 25% to focus solely on the BOT/BAL combination.

The partnership with Zydus represents a strategic move for Agenus as it navigates these challenges and seeks to advance its key cancer therapy.