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Bayer deal with Compugen could be worth more than $500 million

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Bayer HealthCare, the German-based pharmaceutical with operations in northern New Jersey, has entered into an oncology collaboration and license agreement with Compugen Ltd.

The deal calls for an upfront payment of $10 million to Compugen, a Tel Aviv, Israel-based genomic based and diagnostic discovery company.

The partnership targets research, development and commercialization of antibody-based therapeutics for cancer immunotherapy against two novel immune checkpoint regulators discovered by Compugen.

Immunotherapy aims to combat cancer by stimulating the body’s own immune cells.

Under the agreement, the partners will pursue a preclinical research program. Bayer will have full control over further development and worldwide commercialization rights for potential cancer therapeutics.

The announcement comes as Bayer HealthCare increases development of its own drugs to treat cancer, including medicines to treat thyroid, liver and other cancers.

“Immunotherapy is one of our focus areas in oncology research,” said Andreas Busch, member of the Bayer HealthCare executive committee and head of global drug discovery, in a statement. “We are looking forward to expanding our portfolio through partnering with Compugen.”

In addition to the $10 million upfront payment, Compugen is eligible to receive more than $500 million in milestone payments for both programs. Plus, Compugen can receive $30 million associated with preclinical activities.

Bayer HealthCare, in Berlin, is in the process of centralizing area operations from four sites — in Wayne, Montville and Morristown, in New Jersey, plus a building Tarrytown, N.Y. — to one location in the Whippany section of Hanover.

Reporter Tom Zanki is @BizTZanki on Twitter.

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