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Why Autolus Therapeutics Stock Jumped 25% Today

By Joe Tenebruso – Nov 8, 2021 at 9:29PM

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A private equity firm is taking a $100 million stake in the biotech.

What happened

Shares of Autolus Therapeutics (AUTL -1.93%) surged 25% on Monday after the biopharmaceutical company struck a deal to receive financing of up to $250 million from Blackstone Life Sciences.  

So what

Under the terms of the deal, Blackstone agreed to buy $100 million of Autolus' American depositary shares. Additionally, Autolus would receive a $50 million upfront payment, as well as $100 million in milestone payments. The biotech said it would use this cash to fund the development and commercialization of its experimental leukemia therapy, obecabtagene autoleucel (obe-cel).

Two people are shaking hands.

Investors cheered Blackstone's investment in Autolus Therapeutics. Image source: Getty Images.

In return, Blackstone would receive royalty and milestone payments based on sales of obe‐cel. The private equity firm would also obtain warrants to buy another $24 million worth of Autolus' shares, as well as a seat on Autolus' board of directors.

"Autolus is a world-class company with an innovative platform and the potential to deliver best-in-class, lifesaving treatments to patients suffering from cancer," Blackstone executive Dr. Nicholas Galakatos said in a press release.

Now what 

Autolus' cell therapy targets a type of cancer called adult acute lymphoblastic leukemia (ALL) which affects the blood and bone marrow. In August, the company received a Promising Innovative Medicine (PIM) designation for obe-cel from the U.K. Medicines and Healthcare products Regulatory Agency. 

"PIM designation is a recognition of obe-cel as a promising candidate for the Early Access to Medicines Scheme (EAMS) in the UK for the treatment of adult patients with r/r ALL, a life-threatening condition with high unmet need," Autolus CEO Dr. Christian Itin said at the time. 

Blackstone hopes its investment will help to get Autolus' investigational treatment to patients faster. "We see a significant opportunity to improve the outlook for cancer patients who are facing a devastating course of their disease," Blackstone executive Nicholas Simon said. 

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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