Shares of Seattle Genetics ( SGEN) jumped 28% after the company announced a deal with biotech giant Genentech ( DNA) to develop a blood cancer drug. The small drugmaker's stock gained $1.49 to $6.78 early Monday. The companies entered a worldwide license agreement to develop and market the drug, dubbed SGN-40, for the treatment of multiple myeloma, chronic lymphocytic leukemia and non-Hodgkin's lymphoma. Seattle Genetics has an option for co-promotion rights on SGN-40 in the U.S. Under the deal, Seattle Genetics will receive an upfront payment of $60 million and potential clinical, regulatory and sales milestone payments exceeding $800 million. The company could also receive royalties on annual sales of the drug. Genentech will fund future research, development, manufacturing and commercialization costs. Seattle Genetics will continue certain early human trials and development activities, the costs of which will be reimbursed by Genentech. "This alliance enables us to accelerate and expand development of SGN-40 while we continue to advance our other promising clinical and preclinical development programs," said CEO Clay Siegall.