On Tuesday, Rigel (NASDAQ:RIGL) Pharmaceuticals (NASDAQ:RIGL) maintained its Buy rating and $57.00 price target from H.C. Wainwright, following the announcement of a significant licensing agreement with Kissei Pharmaceuticals. The deal grants Kissei exclusive rights to develop and commercialize Rigel's drug Rezlidhia in Japan, the Republic of Korea, and Taiwan.
Rezlidhia, used to treat relapsed or refractory acute myeloid leukemia (AML) with a specific mutation, is already available in the U.S. Kissei's immediate goal is to obtain approval for the drug in Japan for this AML subtype and will manage the required clinical trials.
This collaboration is a continuation of Rigel and Kissei's existing partnership, which includes the development and commercialization of another Rigel drug, Tavalisse, for chronic immune thrombocytopenia (ITP) and potentially other conditions in the same regions.
The agreement with Kissei could significantly extend Rezlidhia's market reach, considering Japan's estimated 11,000 AML patients and the higher prevalence of the disease compared to other leukemia subtypes in the country. Rigel is set to receive a $10 million upfront cash payment and could earn up to $152.5 million more if certain development, regulatory, and sales milestones are met.
Of the initial payment, Rigel will retain $7.7 million, with the remaining $2.3 million allocated to Forma Therapeutics as per their worldwide licensing agreement for the development and commercialization of Rezlidhia.
In addition to the upfront payment and potential milestones, Rigel will benefit from product transfer price payments for Rezlidhia, which range from the mid-twenty to lower-thirty percent based on tiered net sales.
Despite the licensing agreement with Kissei, Rigel retains the global rights to further develop and commercialize Rezlidhia outside of the specified Asian countries. The company is actively seeking additional partnership opportunities to expand the drug's global footprint.
In other recent news, Rigel Pharmaceuticals Inc. has solidified a strategic agreement with Kissei Pharmaceutical Co., Ltd. This collaboration grants Kissei exclusive development and commercialization rights for the cancer drug olutasidenib in select Asian markets, including Japan, the Republic of Korea, and Taiwan.
Rigel is set to receive an upfront payment of $10 million, with the potential for additional payments of up to $152.5 million based on specific developmental, regulatory, and sales milestones.
In terms of earnings, Rigel reported a robust 40% increase in net product sales for the second quarter of 2024, reaching $33.5 million. This surge is largely attributed to strong sales of TAVALISSE and REZLIDHIA, as well as initial revenue from the newly launched cancer therapy, GAVRETO.
The company's ongoing clinical trials and development programs, including the IRAK1 and 4 inhibitor R289 and the RIPK1 inhibitor programs in partnership with Lilly, are also progressing.
Rigel anticipates continued growth in net product sales into the third quarter of 2024, nearing financial break-even due to its disciplined financial approach and operational efficiency. These are among the recent developments in Rigel's business operations.
It is important to note that the anticipated payments and milestones are subject to various risks, including regulatory decisions, trial outcomes, market conditions, and the capabilities of its partners to secure marketing approvals.
InvestingPro Insights
In light of Rigel Pharmaceuticals' recent licensing agreement, investors may be interested in the latest data and analysis provided by InvestingPro. Real-time metrics indicate a market capitalization of $230.41 million, underscoring the company's position in the market.
Despite not being profitable over the last twelve months, Rigel has shown strong returns in the short term, with a 38.56% increase over the last month and a 36.71% increase over the last three months. This performance may reflect investor optimism following the new partnership and the potential for Rezlidhia's market expansion.
InvestingPro Tips reveal that four analysts have revised their earnings upwards for the upcoming period, suggesting a positive outlook on Rigel's financial prospects. However, the same analysts do not anticipate the company will be profitable this year. With these insights, investors can better gauge the company's trajectory following the Kissei deal. For those seeking more in-depth analysis, InvestingPro offers additional tips (https://www.investing.com/pro/RIGL) to help investors make informed decisions.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.