Regeneron, Sanofi Expand Immunology Alliance With $1B Upfront Payment: Here Are The Key Highlights

• Regeneron is set to receive $1 billion upfront, with another $7 billion tied to development, regulatory and commercial milestones.
• The expanded partnership brings four long-acting antibody programs into the alliance, with three candidates expected to enter clinical studies next year.
• Regeneron will retain an option to add Sanofi’s investigational lunsekimig after its Phase 3 COPD studies are completed.

Sanofi (SNY) and Regeneron Pharmaceuticals (REGN) are expanding their long-running immunology alliance, adding four next-generation, long-acting antibody programs to the partnership in a deal that gives Regeneron $1 billion upfront and up to another $7 billion in potential milestone payments.

REGN and SNY shares were trading marginally higher in premarket trading at the time of writing on Thursday morning.

Regeneron To Receive $1B Upfront

Under the expanded collaboration agreement, Regeneron will receive a $1 billion upfront payment from Sanofi, with the potential for up to an additional $7 billion in development, regulatory and commercial milestone payments.

The companies will share development and commercialization costs for the new programs and split future profits from the potential products 50:50 globally.

Four Long-Acting Antibodies Added

The expanded Alliance covers four new long-acting antibodies invented by Regeneron. The candidates target interleukin-13 (IL-13), an IL-4xIL-13 bispecific, interleukin-4 (IL-4) and interleukin-4 receptor alpha (IL-4Rα).

REGN20423, a long-acting IL-13 monoclonal antibody, is currently in a Phase 1 clinical study for atopic dermatitis. The other three antibodies are expected to enter clinical studies in 2027.

Regeneron CEO Calls Alliance Expansion A Foundation For Next-Gen Medicines

“The Regeneron-Sanofi alliance has been one of the most productive in biopharma history. This agreement builds on that foundation to bring the next generation of immunology medicines to patients even faster,” Regeneron President and CEO Leonard S. Schleifer said.

Under the expanded agreement, Regeneron will lead research and development activities, while Sanofi will lead global commercial efforts.

Regeneron Gets Option To Add Lunsekimig

Regeneron will also have the option to include Sanofi’s lunsekimig in the collaboration after completion of its Phase 3 studies for chronic obstructive pulmonary disease.

Lunsekimig is an investigational bispecific Nanobody VHH therapy targeting TSLP and IL-13.

Dupixent Profit-Sharing Agreement Unchanged

The expanded Alliance builds on the companies’ more than 20-year collaboration, which includes their work on Dupixent. More than 1.5 million people are currently receiving Dupixent across nine indications, according to the companies.

Sanofi and Regeneron said the existing profit-sharing agreement for Dupixent, their blockbuster immunology drug, will not change. The companies also said they have settled their prior collaboration-related litigation.

Sanofi and Regeneron are scheduled to host a conference call for investors and analysts at 8:00 a.m. ET on Thursday.

Retail View On SNY and REGN

On Stocktwits, retail sentiment for Regeneron (REGN) rose to "bullish" from "neutral" a week ago, on "normal" message volume. Sanofi (SNY) sentiment, by contrast, held at "neutral" over the past 24 hours.

REGN shares have slipped nearly 3% year-to-date, compared with a drop of almost 18% for SNY.

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