Human Genome Sciences Shares Up on Novartis Albuferon Licensing Agreement

ROCKVILLE, Md. -- Shares of Human Genome Sciences Inc. jumped Tuesday after the biotech company agreed to partner with Swiss drug maker Novartis AG to develop and commercialize a type of the protein interferon to treat chronic hepatitis C and other uses.

Human Genome shares rose $1.01, or nearly 10 percent, to $11.20 in premarket activity on the INET electronic exchange. Shares have traded between $7.63 and $15.50 over the past 52 weeks.

Under the agreement, Human Genome will get an upfront payment of $45 million from Novartis for an exclusive worldwide licensing agreement to Albuferon.

The pact calls for the companies to share clinical development costs along with U.S. commercialization costs and profits equally. Human Genome, which is responsible for bulk manufacturing, is also entitled to a $47.5 million milestone payment when it enrolls its first patient into late-stage clinical trials, expected by the end of the year.

Novartis will be responsible for non-U.S. commercialization and Human Genome will receive royalties on those sales.

The pact could be worth as much as $507.5 million to Human Genome.