Shares of Apellis Pharmaceuticals spiked nearly 17 percent in morning trading after the company had announced a unique partnership that could provide it with financing of up to $250 million.
Apellis, based in Crestwood, said in a news release Thursday that it had reached a “risk-sharing” agreement with the Waltham, Mass.-based drug development company SFJ Pharmaceuticals that calls for SFJ to support Apellis in developing its APL-2 drug.
Apellis said that it was the first time that SFJ had partnered with a biopharma company that is not yet generating revenue.
Shortly after noon, Apellis shares traded at $17.68, up $2.53, or 16.7 percent.
Apellis CEO Cedric Francois said in the news release that the collaboration would allow the local company to diversify its development risk while maintaining financial flexibility and retaining full commercial rights for APL-2.
“We are fortunate to partner with the highly experienced and qualified drug development professionals at SFJ Pharma, who have an outstanding track record of success,” Francois said.
An agreement between the two companies calls for SFJ to provide up to $170 million to Apellis to support the development of APL-2 for the treatment of paroxysmal nocturnal hemoglobinuria (PNH), a disorder that leads to the premature death and impaired production of blood cells.
The companies also have signed a letter of intent to enter a joint development agreement that would provide Apellis with up to $80 million to develop APL-2 for the treatment of two diseases in which the body’s immune system mistakenly attacks and destroys its own red blood cells — cold agglutinin disease (CAD) and warm autoimmune hemolytic anemia (wAIHA.)
Apellis recently said that new data from clinical studies indicated that APL-2 provided “meaningful improvement” in the treatment of all three conditions.
The company also recently said that the drug has received approval from the Food and Drug Administration to be designated an “orphan drug” for wAIHA and CAD. The designation provides the company with development incentives, including tax credits.
Francois has told Insider that Apellis views APL-2 as a platform drug that can provide doctors with new ways to combat various life-altering conditions for which patients have few or no treatment options.