Celgene opts not to acquire Sutro Biopharma for $1bn, reworks existing partnership

Celgene already owns 15% of Sutro and will still be able to purchase shares in addition to this, but will no longer have the option to buy up the company.

Changes on both sides of the deal since 2014 have forced this re-evaluation of their existing agreement, with Celgene seeking to pick up specific assets rather than total acquisitions, and Sutro experiencing strong successes in projects like STRO-001, an antibody-drug conjugate targeting B-cell maturation antigen for use in non-Hodgkin lymphoma and multiple myeloma, which is soon to enter the clinical trial stage.

The reworked agreement means that Celgene can now acquire worldwide rights to a second programme, as opposed to just the first as was agreed in the original deal, and ex-US rights to a further two. Sutro will also now be able to consider financing options including an initial public offering, which was forbidden under the previous agreement, while also maintaining rights to developmental and regulatory milestone payments and royalties.

"Our goal is to continue to build momentum for promising antibody drug conjugates and bispecific antibodies for immuno-oncology therapeutics developed with Sutro's cell-free protein synthesis platform," commented Sutro CEO Bill Newell. "With this revised agreement, Celgene continues to support Sutro's development, while we can move rapidly into development of multiple product candidates and evaluate new opportunities for partnerships and funding."