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.

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.