Feb. 10--Hospira shares got a big boost last week when Pfizer agreed to buy the company for $15.23 billion. This week, Hospira is paying it forward to a small pharmaceutical company in California, agreeing to help it develop a drug.
Pfenex, which issued its initial public offering in July, closed at $6.90 on Monday and was up more than 20 percent Tuesday.
Lake Forest-based Hospira said Tuesday it has agreed to help the biosimilars company develop a drug that would be a generic alternative to Genentech's Lucentis, which treats macular degeneration. Biosimilars are generic forms of existing biotechnology treatments made from living cells.
In the nine months leading to Sept. 30, Pfenex generated $8.6 million in revenue. During the same time period, Hospira posted $3.34 billion in sales.
Hospira plans to pay Pfenex $51 million upfront, assuming the collaboration is approved by regulators. Pfenex then will receive up to $291 million in sales-based milestone payments and tiered double-digit royalties on sales of the drug. Hospira will manufacture the drug.
"We are extremely pleased to announce our collaboration with Hospira, a recognized world leader in biosimilars," said Pfenex CEO Bertrand Liang. "This collaboration further validates the product development strength and capability of Pfenex as we continue to advance our pipeline of biosimilar candidates."
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