Here’s why Regenxbio shares are up close to 30% on Monday morning

Regenxbio Inc (NASDAQ: RGNX) jumped about 30% in the stock market on Monday morning as it announced a partnership with the biopharmaceutical giant AbbVie Inc (NYSE: ABBV).

“In collaboration with REGENXBIO, we aim to make a remarkable impact for the millions of patients suffering from vision loss associated with retinal diseases,” said AbbVie senior vice president Tom Hudson.

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Shares of AbbVie are also up more than 2.0% today.

The deal is expected to close by the end of 2021

The two companies together will develop and commercialise a potential one-time gene therapy they’re calling RGX-314 for chronic retinal diseases, including diabetic retinopathy (DR) and wet age-related macular degeneration (wet AMD).

AbbVie will share costs related to additional studies on RGX-314, the press release added. It will make a $370 million upfront payment to Regenxbio and another up to $1.38 billion in milestones. The deal is likely to close by the end of 2021.

Regenxbio will “lead the manufacturing of RGX-314 for clinical development and commercial supply in the U.S.”, while AbbVie will serve the role outside the United States. Therefore, Regenxbio will take 50% of the total profit generated from net U.S. sales of RGX-314 but only tiered royalties from international sales.

Regenxbio CEO Kenneth Mills’ remarks

Commenting on the partnership, Regenxbio CEO Kenneth T. Mills said:

“AbbVie is a strong, complementary partner for REGENXBIO. We expect to leverage AbbVie’s global developmental and commercial infrastructure within eye care with our expertise in AAV gene therapy clinical development and deep in-house knowledge of manufacturing and production to continue the development of RGX-314.”

The $1.76 billion company is currently testing RGX-314 in patients with wet AMD and DR via two routes of administration; subretinal and suprachoroidal, in separate studies.