What happened
Investors were more than cheered by a business update from cancer-focused biotech Iovance Biotherapeutics (IOVA -1.45%) on Monday. As a result, the company's stock shot well higher by nearly 12% on the day. That was impressive even by the bullish standards of the market on a day when the S&P 500 index pushed more than 1% higher.
So what
Iovance kicked off its work week by pushing out a business, clinical, and regulatory update. The rather comprehensive press release led with an acquisition -- that of the worldwide rights for Proleukin from privately held Clinigen Limited.
For Proleukin, an interleukin-2 molecule used to stimulate T-cell activity in the fight against cancer, Iovance is making an upfront payment of 166.7 million British pounds ($206.6 million).
It is also on the hook for a 41.7 million pound ($51.7 million) milestone payment upon first approval of its leading pipeline therapy, advanced melanoma treatment Lifileucel, and what it described only as double-digit worldwide sales royalties derived from Proleukin.
The deal is expected to close at some point during this calendar quarter.
As for the clinical and regulatory developments, Iovance updated investors about the progress of several pipeline drugs, particularly Lifileucel. The biotech said that at the end of 2022, it reached agreement with the U.S. Food and Drug Administration (FDA) on the scope of a phase 3 trial for the medication. This will take the form of a study of the drug as a combination therapy for the treatment of frontline advanced melanoma.
Now what
Finally, Iovance indicated that its current finances are sufficient to both fund its current operations and splurge on Proleukin. It said that it's financing the deal with cash on hand, which as of Jan. 20 totaled around $477 million. The company added that it has agreed to terms for a secured line of credit of up to $100 million.
