Aduro Biotech, a US-based developer of treatments for pancreatic cancer, has entered a collaboration agreement with pharmaceutical company Novartis to develop and commercialise a range of products based on Aduro’s technology.
As part of the agreement, Novartis has acquired a 2.7% equity stake in Aduro in return for a $25m equity investment. Novartis has committed to a further $50m investment in the future. Aduro is also set to receive an upfront payment of $200m and eligible for a further $500m if all development milestones are met.
The two companies hope to develop drugs capable of initiating immune responses to tumours. Aduro will be responsible for commercialisation of the products in the US, while Novartis will lead these efforts in other countries. Profits made in the US, Japan and Europe will be shared while Aduro will receive a mid-teens royalty for sales in other markets.
Aduro filed for a $86m initial public offering earlier in March 2015, and has now raised $185m in equity funding. Pharmaceutical company Johnson & Johnson’s corporate venturing arm Johnson & Johnson Development Corporation backed a $55m series C round in June 2014 and holds a 6.6% stake.
Aduro will retain all rights to its technology and products for other therapeutic applications such as infectious and auto-immune diseases.