Shares of the clinical-stage immuno-oncology company Trillium Therapeutics (NASDAQ:TRIL) jumped by as much as 40% in pre-market trading Wednesday morning. The biotech's shares are rocketing higher today for two material reasons:
- Trillium rolled out a positive update for its dose-escalating studies for the CD47-targeting antibodies TTI-621 and TTI-622 after the closing bell Tuesday afternoon. The long and short of it is that both of the biotech's lead drug candidates are off to a strong start in the clinic.
- In a follow-on press release, the company also announced that Pfizer (NYSE:PFE) has agreed to take a $25 million equity stake in its common stock. As part of this ownership deal, Jeff Settleman, Pfizer's senior vice president and chief scientific officer for oncology research and development, will reportedly join Trillium's Scientific Advisory Board once it is formed.
Although Pfizer didn't exactly break the bank with this initial equity stake, it is a significant development nonetheless. Trillium's CD47 pipeline has enormous commercial potential as cutting-edge treatments for both solid tumors and blood cancers. Pfizer, for its part, has a well-documented history of buying novel cancer assets at a sky-high premium. So there's is a good chance that this modest equity stake will morph into a deeper relationship over time.
Is Trillium's stock still a buy after this hefty jump? Although the biotech's lead clinical assets are only in early-stage development, it might be worthwhile to consider buying a few shares in the wake of Pfizer's entrance into the picture.
Why is Pfizer's sudden interest a big deal? Earlier this year, Gilead Sciences (NASDAQ:GILD) paid almost $5 billion to acquire the CD47 drugmaker Forty Seven. If Trillium's pipeline continues to show promise in the clinic, its newfound partner might be willing to pay a similar price tag. That's a rather intriguing possibility for potential shareholders. After all, Trillium's market cap stood at less than $800 million at Tuesday's close.