BASEL (dpa-AFX) - Cerulean Pharma Inc. (CERU), a clinical-stage company developing nanoparticle-drug conjugates or NDCs, Wednesday said it has entered into a strategic collaboration with Novartis (NVS) to create NDCs directed at up to five targets. Cerulean will receive an upfront payment of $5 million plus funding for five full-time equivalents. Cerulean also announced $20 million firm commitment at-the-market stock purchase agreement with Aspire Capital Fund.
In pre-market activity, Cerulean shares were gaining 76.81 percent.
Under the deal with Novartis, the companies will develop NDC product candidates combining Cerulean's proprietary Dynamic Tumor Targeting technology with Novartis' proprietary compounds directed at up to five targets. Cerulean will create NDC candidates, and Novartis is responsible for further development and commercialization of NDC products resulting from the collaboration.
Cerulean will receive an upfront payment of $5 million plus funding for five full-time equivalents. Cerulean is also eligible to receive preclinical, clinical, regulatory, and sales milestones for each target. In addition, following regulatory approval of NDC products, Cerulean can earn single-digit to low double-digit tiered royalties on net sales for each NDC product.
Further, Cerulean said it has entered into a $20 million common stock purchase agreement and a registration rights agreement with Aspire Capital Fund, LLC. These agreements constitute a firm commitment at-the-market equity facility. Immediately following the execution of the Purchase Agreement, Aspire purchased 800,000 shares of common stock for $1.25 per share.
Cerulean has the right to sell up to the remaining $19.0 million of its common stock to Aspire over a 24-month period.
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