Kite, Sangamo announce collaboration to develop engineered cell therapies

Kite, a Gilead Company ( GILD ) and Sangamo Therapeutics ( SGMO ) announced the companies have entered into a worldwide collaboration using Sangamo’s zinc finger nuclease technology platform for the development of next-generation ex vivo cell therapies in oncology.

Ex vivo cell therapy is in essence gene therapy delivered by transfer of therapeutic genes to cells in culture, which are then given to the patient to treat fatal infections such as AIDS, or other conditions such as cancer or genetic diseases.

These manipulations include the purification and culture of therapeutic cell subtypes, as well as elimination of cells which cause disease (cancer cells or immune cells reacting to the body itself). Gene therapy can be delivered by transfer of therapeutic genes to cells in culture, which are then given to the patient to treat fatal infections such as AIDS, cancer or genetic diseases.

Kite will use Sangamo’s ZFN technology to modify genes to develop next-generation cell therapies for autologous and allogeneic use in treating different cancers.

Allogeneic cell therapies from healthy donor cells or from renewable stem cells would provide a potential treatment option that can be accessed directly within the oncology infusion center, thus reducing the time to infusion for patients.

Under the terms of the agreement, Sangamo will receive an upfront payment of $150M and is eligible to receive up to $3.01B in potential payments, aggregated across 10 or more products utilizing Sangamo’s technology, based on the achievement of certain research, development, regulatory and successful commercialization milestones.

Sangamo would also receive tiered royalties on sales of potential future products resulting from the collaboration. Kite will be responsible for all development, manufacturing and commercialization of products under the collaboration, and will be responsible for agreed upon expenses incurred by Sangamo.

This transaction is subject to clearance under the Hart-Scott Rodino Antitrust Improvements Act and other customary closing conditions.

A Current Report on Form 8-K describing the proposed transaction in more detail will be filed by Sangamo, and this press release is subject to further detail provided in Sangamo’s 8-K.

Separately, Sangamo reported Q4 EPS (15c) vs consensus (18c) – Reported Q4 revenue $13.1M, consensus $11.43M.