AbbVie will pay I-Mab $180 million up front as part of the deal to develop and collaborate on lemzoparlimab, a potential treatment for multiple cancers.
The drug is one of the company's leading drug candidates in I-Mab's pipeline and is designed to minimize the inherent binding of cancer cells to normal red blood cells which researchers say is critical to treating cancer.
"Cancer is the second-leading cause of death globally and the need for novel cancer therapies has never been more acute. The addition of I-Mab's novel CD47 programs complements our global clinical strategy in hematology and immuno-oncology," said Dr. Thomas J. Hudson, senior vice president of R&D and chief scientific officer, AbbVie.
I-Mab will be in line for a $20 million milestone payment based on Phase 1 results and the company is eligible to receive up to $1.74 billion in success-based milestone payments. Upon commercialization of the drug, AbbVie will pay tiered royalties ranging from the low-to-mid teen percentages on global net sales outside of greater China.
I-Mab has entered into subscription agreements with multiple investors to raise $418 million through a private share sale.
Shares of I-Mab jumped more than 17% on the news to $41.97. The stock, which debuted on the Nasdaq in January, is up more than 49% year to date.
AbbVie shares rose 0.63% to $92.46 on Friday.