Opexa Gets on the Map with Huge MS Pact


Opexa Therapeutics Inc. (NASDAQ: OPXA) is not just soaring this Tuesday. It is rising exponentially after securing an option and license agreement with Merck Serono on its multiple sclerosis treatment. The reason this is up so much is that Opexa was a mere $7 million in market capitalization before this move. The potential payments to Opexa could total $225 million, excluding royalty payments, if all goals are met.

Opexa has announced the execution of an agreement with Merck Serono for the development and commercialization of Tcelna, or imilecleucel-T, which is a potential first-in-class personalized T-cell therapy for patients suffering from multiple sclerosis (MS). Tcelna is being developed by Opexa and currently is in a Phase IIb clinical trial in patients with Secondary Progressive MS.

Under the deal, Opexa will receive an upfront payment of $5 million for granting an option to Merck Serono for the exclusive license of the Tcelna program for the treatment of MS. The option may be exercised prior to or upon completion of Opexa's ongoing Phase IIb clinical trial in patients with SPMS.

When exercised, Merck Serono will pay an upfront license fee of either $25 million or $15 million, based on whether certain conditions are met. Merck Serono will then receive worldwide development and commercial rights (excluding Japan) to Tcelna in MS. Merck Serono would also be wholly responsible for funding clinical development, as well as regulatory and commercialization activities for the MS program.

There is more. Opexa said that the additional financial considerations of the agreement include development and commercial milestone payments to Opexa of up to $195 million and will receive a tiered royalty rate from the high single digits to the mid-teens based on net sales payable to Opexa.

Opexa closed at $1.21 on Monday and has a 52-week range of $1.07 to $4.60, but shares are up around $4.95 in very active trading. Again, the market cap was only about $7 million here. Opexa's average daily volume of 33,000 shares is already being dwarfed by about 750,000 shares and that was with about 30 minutes until the open.

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