Cancer drug developer SuperGen Inc said it entered into a multi-year collaboration with GlaxoSmithKline Plc to discover and develop cancer therapeutics for an upfront payment of $5 million.
The upfront payment includes a $3 million common stock investment, SuperGen said and added that total potential development and commercialization milestones payable to it could exceed $375 million.
Shares of SuperGen soared 28 percent to $3.05 in pre-market trade. They had closed at $2.38 Friday on Nasdaq.
According to the deal, SuperGen will progress drug candidates through to early clinical development, and Glaxo will have the right to exercise an option to develop them further and market the drugs globally.
The companies would develop cancer therapeutics based on epigenetic targets, which refer to the regulation of genes with mechanisms other than changes to the underlying DNA sequence.
Epigenetic processes are widely believed to play a central role in the development and progression of almost all cancers, the company said. (Reporting by Esha Dey in Bangalore; Editing by Himani Sarkar)