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Infinity Pharma Snags Abbvie for Blood Cancer Drug Partnership

CAMBRIDGE, Mass ( TheStreet) -- Infinity Pharmaceuticals (INFI - Get Report) signed up Abbvie (ABBV - Get Report) as a development and marketing partner for its experimental blood cancer drug IPI-145, the companies announced Wednesday.

Under terms of the partnership, Abbvie is paying Infinity $275 million in upfront cash to license worldwide rights to IPI-145, an oral drug designed to block a protein known as PI3K critical for tumor cell growth. Infinity is also eligible to receive an additional $530 million in future cash payments tied to IPI-145 achieving certain development and regulatory milestones. If IPI-145 is approved, Infinity and Abbvie will share marketing responsibilities and split sales and profits in the U.S. Outside the U.S., Infinity will receive a royalty on net sales from Abbvie ranging from 23.5% to 30.5%.

IPI-145 is also now known as duvelisib.

Infinity is already heavily invested in duvelisib's future with a full slate of phase II and phase III studies in chronic lymphocytic leukemia and non-hodgkin lymphoma either underway or getting ready to start before the end of the year. But duvelisib has also struggled to distinguish itself from formidable competition, most notably  Gilead Sciences' (GILD - Get Report)  Zydelig (also a PI3K inhibitor) and  Pharmacyclics' (PCYC - Get Report) Imbruvica , both of which are already approved. Duvelisib has also been dogged with questions about its safety and tolerability relative to competing drugs in the same PI3K inhibitor class, although today's Abbvie partnership will likely assuage some of those concerns.

Before entering today's partnership for duvelisib, Abbvie's lead blood cancer drug candidate was ABT-199, which has demonstrated tremendous efficacy in mid-stage studies but has also been dogged with safety concerns.

Infinity shares closed Tuesday at $10.92, ahead of the Abbvie partnership announcement. Infinity's stock is down 16% this year and almost 40% over the past two years, primarily due to concerns about the future potential of duvelisib relative to its competition.

Also Wednesday, Roche  (RHHBY)  agreed to supply its drug Gazyva to Infinity for combination studies with duvelisib.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

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