(Reuters) – Gilead Sciences (NASDAQ:) will buy all the remaining rights for an experimental cancer therapy, GS-1811, from Jounce Therapeutics (NASDAQ:) for $67 million, the drugmaker said on Tuesday.
The amended licensing deal will bolster Jounce’s cash resources in a challenging market for biotech companies.
Shares of Jounce more than doubled to $1.68, while Gilead’s shares fell marginally in after market trading.
Gilead will now be solely responsible for all further development and commercialization of GS-1811 globally. The amended deal is expected to reduce its 2022 earnings per share by 4 cents on both GAAP and non-GAAP basis.
GS-1811 is currently being evaluated in an early-stage trial for patients with solid tumors and works by selectively depleting T-cells that suppress the body’s immune response and allow tumors to grow.
In 2020, the drugmakers had agreed to collaborate on development of GS-1811, when Gilead made an upfront payment of $85 million to Jounce. Under the initial terms, Jounce was eligible to get up to $685 million in milestone payments from Gilead, of which it has received $40 million so far.
With the amendment, Jounce will no longer receive the remaining milestone payments or any of the sales-based royalties for the therapy.