Looks better all the time
(UPDATE) Immune Response, Agouron To Collaborate On HIV Drug; Investors Cheer
Dow Jones Online News, Thursday, June 11, 1998 at 21:20
LA JOLLA, Calif. -(Dow Jones)- Agouron Pharmaceuticals Inc. and
Immune Response Corp. Thursday announced an agreement to work together
on the development and commercialization of Immune Response's Remune
therapy for HIV. The announcement gave Immune Response's stock a sharp
boost, and prompted positive comments from analysts.
Agouron (AGPH) said it will have exclusive rights to market Remune in
North America, Europe and certain other countries, while Immune Response
will manufacture commercial supplies of the drug to be used in the
treatment of the virus that causes AIDS.
Immune Response shares (IMNR) closed up $1.937, or 17%, to $13.687.
Nasdaq volume totaled 1 million shares, compared with average daily
volume of 290,500 shares.
"It's definitely fabulous news," said Gruntal & Co. analyst David
Saks, who issued a note Thursday morning on the company. "I think it's
very significant for shareholders of Immune Response," he added.
Agouron said the two companies will split all profits from the
commercialization of Remune.
Under the agreement, Agouron could pay Immune Response up to $77
million over the next two years, including license and milestone
payments of $45 million, payments to support development of $18 million,
and the purchase of $14 million of Immune Response common stock. Immune
Response will receive $10 million of the total up front as a license
fee. Agouron said it bought 118,256 newly issued Immune Response common
shares for $2 million.
Immune Response had been intimating that it was working on getting a
collaborator, Saks said. Had he known it was Agouron and been aware of
the substantial amount of money involved, he would have increased his
price targets in his report, he added.
Saks, who rates Immune Response a "strong buy," has a 12-month price
target of $19. He expects the stock will open strongly in trading
Friday.
Immune Response is well along in its development of Remune, which is
why Agouron was willing to pay so much, he said.
Lehman Brothers analyst Tony Butler said Agouron is an "outstanding
partner" for Immune Response.
Butler said Immune Response likely won't file the drug until next
summer. If the results are favorable, the drug wouldn't be expected on
the market until the end of 1999.
-Melanie Trottman 201-938-5099
Copyright (c) 1998 Dow Jones & Company, Inc.
All Rights Reserved.
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