Shares of drug maker Gritstone Oncology (GRTS) - Get Report jumped more than 20% premarket after the company announced a collaboration with Gilead Sciences (GILD) - Get Report to develop a cure for HIV, the disease that causes AIDS.
Gritstone and Gilead are developing an HIV-specific therapeutic vaccine using Gritstone's proprietary prime-boost vaccine platform and Gilead providing amplifying mRNA and adenoviral vectors.
"While HIV treatment has advanced dramatically over the past three decades, people living with HIV still face a lifetime of therapy," said Diana Brainard, MD, Senior Vice President, Virology Therapeutic Area, Gilead Sciences. "Curing HIV remains the ultimate aspiration for Gilead’s HIV research and development efforts."
Gritstone shares jumped 18.2% to $21.40 Monday before the opening bell while Gilead shares rose 0.4% to $65.88.
Under the agreement, Gilead will make an initial $60 million payment, consisting of a $30 million upfront cash payment and a $30 million equity investment at a premium.
Gilead will be responsible for conducting a Phase 1 study for the HIV therapeutic vaccine and holds an exclusive option under the collaboration to obtain an exclusive license to develop and commercialize the vaccine beyond Phase 1.
Gritstone is also eligible to receive up to an additional $725 million if Gilead exercises that option and if certain clinical, regulatory and commercial milestones are achieved, as well as mid single-digit to low double-digit tiered royalties on net sales upon commercialization.
"On the heels of our recent COVID-19 program initiation in partnership with the NIH, this program adds to our growing infectious disease pipeline supported by collaborations with leading biopharma and renowned institutions," said Gritstone CEO Andrew Allen.