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IGM (IGMS) Skyrockets on Collaboration Deal With Sanofi

Zacks Equity Research
·3-min read

IGM Biosciences, Inc.’s IGMS share price nearly doubled on Tuesday, after the company announced that it has entered into an exclusive partnership with Sanofi SNY to create, develop and commercialize new therapies targeting oncology, immunology, and inflammation indications.

The collaboration will utilize IGM Biosciences’ proprietary IgM antibody technology platform to discover IgM antibody agonists, which will target six indications — three in oncology and another three in immunology/inflammation.

Per the agreement terms, Sanofi will pay an upfront payment of $150 million to IGMS. In addition, SNY may pick up a non-voting stake in the company up to $100 million in public financing. IGMS will be eligible to receive more than $6 billion in milestone payments.

In the year so far, ImmunoGen’s stock price has declined 0.6% in comparison with the industry’s 11.2% decline.

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For each oncology target picked as part of the deal, IGM Biosciences will lead all research and development activities till its regulatory approval. In return, IGMS will be eligible to receive an aggregate sum of $940 million per onology target in potential milestone payments. All subsequent development and commercialization activities post regulatory approval will be headed by Sanofi. While both the companies will share profits equally in certain major markets, IGMS will receive tiered royalties on net sales in the remaining markets.

For each immunology/inflammation target picked per the deal, IGM Biosciences will lead all research and development activities till the completion of the phase I study for up to two constructs directed to each immunology/inflammation target. In return, IGMS will be eligible to receive an aggregate sum of $1,065 million per target. All subsequent development and commercialization activities post the phase I study will be led by SNY. IGMS will be eligible to receive tiered royalties on global net sales.

This deal is likely to yield benefits for IGM Biosciences, which does not have any marketed product in its portfolio and lacks a stable stream of revenues. In fact, the company’s most advance candidate is IGM-2323, which recently entered into two phase II studies for treating patients with diffuse large B cell lymphoma and follicular lymphoma.

IGM Biosciences, Inc. Price

IGM Biosciences, Inc. Price
IGM Biosciences, Inc. Price

IGM Biosciences, Inc. price | IGM Biosciences, Inc. Quote

Zacks Rank & Stocks to Consider

IGM Biosciences currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the overall healthcare sector are Collegium Pharmaceutical COLL and Vertex Pharmaceuticals VRTX. While Collegium Pharmaceutical sports a Zacks Rank #1 (Strong Buy), Vertex Pharmaceuticals carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Collegium Pharmaceutical’s earnings per share estimates for 2022 have increased from $3.79 to $5.76 in the past 60 days. The same for 2023 has increased from $4.79 to $7.96 in the past 60 days. Shares of COLL have risen 8% year to date.

Earnings of Collegium Pharmaceutical beat estimates in three of the last four quarters and missed the mark on one occasion, with the negative surprise being 57.6%.

Vertex Pharmaceuticals’ earnings per share estimates for 2022 have increased from $14.33 to $14.52 in the past 60 days. Shares of VRTX have risen 17.5% year to date.

Earnings of Vertex Pharmaceuticals beat estimates in each of the last four quarters, with the average being 10%.


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Sanofi (SNY) : Free Stock Analysis Report

Vertex Pharmaceuticals Incorporated (VRTX) : Free Stock Analysis Report

Collegium Pharmaceutical, Inc. (COLL) : Free Stock Analysis Report

IGM Biosciences, Inc. (IGMS) : Free Stock Analysis Report

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