RICHMOND, Calif. - Sangamo Therapeutics, Inc. (NASDAQ: SGMO), a genomic medicine company, has entered into a licensing agreement with Genentech, a Roche (LON:0QQ6) Group member, to develop genomic medicines for neurodegenerative diseases. Sangamo will provide Genentech with exclusive access to its zinc finger repressors targeting the tau gene, implicated in Alzheimer's disease and other tauopathies, and an undisclosed second neurology target.
Under the agreement terms, Sangamo will receive $50 million in upfront license fees and milestone payments, with the potential to earn up to $1.9 billion in development and commercial milestones across several medicines. Additionally, Sangamo will receive tiered royalties on net sales of products developed through this partnership, subject to specific reductions.
The collaboration leverages Sangamo's proprietary neurotropic adeno-associated virus capsid, STAC-BBB, which has shown significant penetration of the blood-brain barrier and brain transduction in nonhuman primates. This technology aims to overcome challenges in delivering therapeutics to the central nervous system.
Sangamo's CEO, Sandy Macrae, expressed confidence in the company's zinc finger technology to regulate genes associated with diseases. He noted the agreement's potential to advance treatments for neurodegenerative disorders.
Boris L. Zaïtra, Head of Roche Corporate Business Development, highlighted the shared commitment to exploring transformative approaches to treat neurodegenerative diseases, emphasizing the importance of scientific innovation and early diagnosis.
Sangamo is responsible for completing a technology transfer and certain preclinical activities, while Genentech will manage clinical development, regulatory interactions, manufacturing, and global commercialization of any resulting products.
This partnership aligns with Sangamo's focus on addressing neurological diseases with limited treatment options. The company continues to seek additional collaborations for its STAC-BBB capsid delivery platform and epigenetic regulation capabilities.
The information provided is based on a press release statement from Sangamo Therapeutics.
In other recent news, Sangamo Therapeutics has reported significant progress in its operations. The company's Q1 2024 earnings call highlighted key advancements in its neurology pipeline, including promising preclinical data and completion of patient dosing for the Fabry disease program's Phase 1/2 STAR study.
Sangamo also announced positive results from Pfizer (NYSE:PFE)'s Phase 3 AFFINE trial evaluating giroctocogene fitelparvovec, a gene therapy for adults with severe hemophilia A. This trial showed a significant drop in annualized bleeding rates, with 84% of participants maintaining FVIII activity above 5% after 15 months.
Sangamo is set to receive up to $220 million in milestone payments from Pfizer, in addition to product sales royalties of 14% to 20%, contingent on regulatory and commercial achievements. Pfizer is poised to commercialize this therapy, which has received Fast Track and Regenerative Medicine Advanced Therapy designations from the U.S. FDA, as well as Orphan Drug designations in the U.S. and Europe.
On the financial side, Sangamo reported approximately $54 million in cash and equivalents, sufficient to fund operations until Q3 2024. However, the company is actively pursuing additional capital and is in ongoing business development discussions for various programs, including their MINT platform and gene therapy efforts. These are the recent developments for Sangamo Therapeutics.
InvestingPro Insights
In the wake of Sangamo Therapeutics' new licensing agreement with Genentech, investors are closely monitoring the company's financial health and market performance. According to InvestingPro data, Sangamo boasts a market capitalization of 159.35 million USD, highlighting its presence in the biotech industry. Interestingly, the company has seen a significant return over the last month, with a 138.11% increase, suggesting a positive market reaction to recent developments.
Despite these gains, Sangamo's financial metrics indicate challenges ahead. The company's revenue for the last twelve months as of Q1 2024 stands at 18.76 million USD, which represents a steep decline of 92.22% from the previous year. This aligns with an InvestingPro Tip that analysts anticipate a sales decline in the current year. Moreover, with a gross profit margin of -932.37%, Sangamo is grappling with weak gross profit margins, which could impact its ability to sustain operations without further strategic partnerships or capital infusions.
Investors should note that Sangamo holds more cash than debt on its balance sheet, which is a positive sign of financial stability. However, another InvestingPro Tip cautions that the company is quickly burning through cash, which could be a cause for concern given its current revenue trajectory.
For those interested in a deeper analysis, InvestingPro offers additional insights on Sangamo Therapeutics, including 12 more InvestingPro Tips that could guide investment decisions. For instance, analysts have revised their earnings upwards for the upcoming period, which may suggest optimism about the company's future performance despite the challenges it faces. To explore these insights further, visit InvestingPro's dedicated page for Sangamo at https://www.investing.com/pro/SGMO.
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