Amgen (Nasdaq: AMGN) wants a taste of what Bayer, Sanofi (NYSE: SNY) and Boehringer Ingelheim have already sunk their teeth into: Micromet's (Nasdaq: MITI) BiTE antibody technology.

BiTE drugs fuse an antibody onto a molecule that attracts immune system cells called T cells to attack tumor cells. Distinct antibodies can be used to target drugs to different tumor types, which explains Micromet's multiple partnerships. And of course immunotherapies are hot after the success of Dendreon's (Nasdaq: DNDN) Provenge and Bristol-Myers Squibb's (NYSE: BMY) Yervoy.

Micromet could get $975 million in its latest deal, but it's going to be awhile before the company sees that kind of money. As part of the deal, Micromet gets just $14 million up front to develop a BiTE antibody toward an undisclosed solid tumor target. If a second target is also pursued, Amgen will end up paying up to $35 million to get the two drugs into the clinic.

That's a pretty reasonable price to pay for pushing two drugs through preclinical development, but the milestone payments of nearly $1 billion for two drugs seems a bit high considering that Amgen is footing the entire bill for developing the programs. If they make it to market, Micromet is also due royalties that reach the double-digit level.

While it sounds steep, we can't actually chastise Amgen for making the deal because the timing of when these biobucks will be paid out wasn't disclosed. If they're mainly back-end loaded -- paid when the drug hits annual sales of $1 billion, for instance -- the deal doesn't look nearly as expensive as the headlines might make it out to be.

At this point, the deal looks good for Micromet's investors -- more research funding and possible royalties down the line -- and potentially interesting for Amgen's investors. Just be prepared to become more or less excited based on how the milestone payments work out.

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