J&J is paying $35 million upfront to Geron for rights to the drug. The two companies will share development costs equally though Geron is eligible for another $900 million in payments based on future development and regulatory milestones. If imetelstat is approved, Geron will receive royalties from J&J based on the drug's sales.
Geron shares were halted at $2.31 ahead of the partnership announcement.
You can read more details about the terms of the Geron-J&J partnership in the company's 8-K, but to sum it up, J&J is making a conservative bet on imetelstat and doesn't have to commit fully until the drug generates more positive data. Starting in the middle of next year, Geron and J&J will conduct a larger phase II study of imetelstat in myelofibrosis patients. J&J will use results from that study to make a go/no-go decision on funding further development of the drug.
Updated results from a earlier phase II study of imetelstat in myelofibrosis were disclosed last week.