Last Monday, Affimed N.V. (NASDAQ:AFMD) signed a lucrative licensing deal with biotech heavyweight Roche (OTC:RHHBY) for its Redirected Optimized Cell Killing (ROCK) platform. This deal sent Affimed's shares up a whopping 246% yesterday, thanks in large part to a $96 million upfront payment that's to be delivered over the next 12 months. Adding fuel to the fire, Affimed is also reportedly eligible to receive a staggering $5 billion in additional milestone and royalty payments moving forward. 

Given the jaw-dropping magnitude of Affimed's move higher yesterday, investors are probably asking themselves if it's a good idea to stay the course with this speculative biotech stock, or whether it's time to take profits. Let's dig deeper to find out the answer. 

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Did Roche overpay for an unproven platform?

Roche is certainly not afraid to open its wallet to acquire novel technologies. Through its various acquisitions in biotech, after all, Roche has built a commanding lead over its rivals in both biologically based medicines in general, and oncology in particular. However, Roche's ongoing spending spree hasn't always been cost-efficient.

Despite having the highest research and development (R&D) budget in the sector and one of the highest in terms of R&D as a percentage of pharmaceutical sales, Roche's clinical pipeline is presently ranked 10th among large-cap drugmakers in terms of present net value. Roche's pipeline did create the second highest amount of value among major drugmakers in terms of products approved last year. But the biotech's willingness to pay top dollar for experimental-stage products and platforms hasn't set it up for long-term success -- at least not yet. 

And that brings us to Roche's latest cash-rich deal with Affimed. Affimed's platform is designed to boost the potency of natural killer (NK) and T cells against specific malignancies such as CD30-positive lymphomas. To do so, the company has developed "first-in-class tetravalent, multi-specific immune cell engagers that support innate and adaptive drug development."

The basic idea is that the initial waves of immuno-oncology products to hit the market have so far only been effective in between 10% to 30% of patients. Affimed's ROCK platform, in theory, would broaden the number of patients eligible to be treated by NK and T cell-based immuno-therapies.

These customized therapies should also be more amenable for use in combination with other immunotherapies already on the market, such as Merck's (NYSE:MRK) Keytruda. In fact, Affimed has already released some intriguing early-stage data showing a powerful synergy between its lead NK cell engager, AFM13, and Merck's Keytruda. 

This novel immunotherapy platform, therefore, seems to have the ingredients necessary to be a major step forward in the battle against cancer. In that event, Roche would indeed be onto something special with this latest licensing deal.  

Is Affimed's stock still a buy?

With a ginormous $5 billion in milestone and royalty payments ahead of it, Affimed's stock seems primed to head even higher. Apart from this sizable revenue opportunity, Affimed's stock should also benefit from the company being partnered with one of the best in the business at developing novel oncology treatments.

So, despite this monstrous leg up yesterday, growth-oriented investors comfortable with risk may want to start building a position in this promising immuno-oncology stock soon. Roche, after all, should be able to leverage its extensive expertise to get the most bang for its buck out of Affimed's unique cancer-fighting platform, whereby implying that these hefty milestone payments should be achievable.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.