NEW YORK (TheStreet) -- Shares of Arrowhead Pharmaceuticals (ARWR) - Get Report were jumping 9.94% to $7.74 on heavy trading volume late-morning Thursday as the biopharmaceutical company said it's partnering with Amgen on two cardiovascular drug development projects.
One licensing agreement allows the Thousand Oaks, CA-based biopharmaceutical company to develop Arrowhead's RNAi ARC-LPA program, while another agreement allows Amgen to use the RNAi therapy for "an undisclosed genetically validated cardiovascular target," Arrowhead said in a statement.
The RNAi molecules are meant to reduce elevated lipoprotein, which is a risk factor for cardiovascular disease, the company noted. Amgen will also commercialize the treatments.
Arrowhead will receive $35 million in upfront payments, $21.5 million in the form of an equity investment by Amgen in Arrowhead common stock, as well as up to $617 million in option and milestone payments.
Arrowhead can receive single digit royalties for sales of products from the undisclosed target and up to low double digit royalties from sales of products related to the ARC-LPA agreement.
The deal is expected to close before the end of the fiscal 2016 fourth quarter.
About 3.57 million of Arrowhead's shares have changed hands so far today vs. its average volume of 977,864 shares per day.
Shares of Amgen were lower in late-morning trading on Thursday.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
TheStreet Ratings team rates Arrowhead a Sell with a ratings score of D. This is driven by several weaknesses, which it believes should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks it covers. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, disappointing return on equity, weak operating cash flow and feeble growth in its earnings per share.
You can view the full analysis from the report here: ARWR