Agenus Inc (NASDAQ:AGEN) And Incyte Corporation (NASDAQ:INCY) Are Working On Amending Their Licensing Deals

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Agenus Inc

The two legal-drug giants, Agenus Inc (NASDAQ:AGEN) and Incyte Corporation (NASDAQ:INCY), are apparently aiming to better their standings with one another, through amending contracts, which both companies had signed in ages past.

The agreement, which was signed throughout January 2017 was a drug licensing deal. This deal extended to the paired development and commercialization of drugs. Furthermore, it also included profit-sharing agreements between the two entities.

What the agreement will mean for both companies

The deal between these companies will create a new drug giant in town. However, the fact is true that both companies will have a vast amount of opportunity to gain through this deal. However, as per the agreement, there will also be a sacrifice for this victory.

The original agreement was worth $410 million. However, the companies have decided to relook at some of the fine details, regarding the payouts and profit-sharing arrangements in the contract, which may lower, or increase the total value of the agreement.

In the agreement, one of the iron-clad clauses is that Incyte will become liable to give Agenus $20 million, as an investment to two drugs, namely the INCAGN1876, as well as the INCAGN1949. Furthermore, Incyte will be liable to paying up to 15 percent royalties on worldwide sales, for any approved products, which emerged from this program.

What Agenus has to gain and pay over this agreement

In addition to the royalties, Agenus will also gain a new shareholder, as Incyte, as per the agreement, will proceed to purchase 10 million in common shares from Agenus. This will be sold at a fixed price of $6 per share.

Both companies believe that through this partnership, they will be able to instrumentally change the way that their production and development teams are able to handle products. Furthermore, this agreement will be the key to opening new market opportunities.

The CEO of Agenus, Garo Armen, stated, “We believe the amended agreement will help streamline the development of our collaboration portfolio, provide the opportunity to prioritize our other internal programs towards rapid commercialisation and help foster the development of various new products.”

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