Compugen rises on royalty deal with AstraZeneca

Shares of Compugen (CGEN) added ~16% in the premarket on Wednesday after the Israel-based biotech announced an agreement with AstraZeneca (AZN) to monetize a portion of future royalties linked to its cancer drug rilvegostomig.

As part of the agreement, the Anglo-Swedish pharma giant has opted to amend a 2018 exclusive license deal between the two companies and acquire a portion of Compugen's (CGEN) existing royalty interest in the drug.

However, CGEN said it remains eligible to receive the majority of its future royalties linked to the drug, which is currently undergoing late-stage development for multiple cancers, including lung and endometrial.

The transaction allows Compugen (CGEN) to receive $65M upfront and a potential $25M additional payment, subject to achievement of the next milestone linked to FDA acceptance of a marketing application for rilvegostomig.

The non-dilutive financing is expected to extend Compugen’s (CGEN) cash runway into 2029.