Swiss biotechnology company Cytos Biotechnology Ltd has taken commercial licenses for specified vaccines based on Cytos' immunodrug technology, based on a research, option and license agreement signed by the two companies in August.
The event triggers payments to Cytos, but spokeswoman Claudine Blaser didn't reveal the amount to be paid to Cytos now. Under the agreement struck in August, Cytos is eligible to receive up to 150 million Swiss Francs ($139.4 million) from Pfizer.
"Cytos reveals too few details to calculate a potential impact on the company," says Helvea analyst Olav Zilian who rates Cytos at reduce with a CHF9 price target. "In August the company said it would receive an upfront payment of CHF10 million from Pfizer, but in its third-quarter report said that the entire payment was deferred. So Cytos may possibly receive some of those CHF10 million now," he added.
At 0835 GMT, Cytos shares traded up 12%, or CHF3, at CHF28. Cytos' Blaser said "We welcome that Pfizer has made use of its right to take those licenses. It shows that the company appreciates our technology."
Over the past twelve months, Cytos shares have lost around 67% of their value, while the European Health Care sector has shed around 14% in the same period.
Big pharmaceutical companies have outperformed biotechs in the past twelve months, reflecting the fact that smaller companies are more exposed to the financial crisis because they rely heavily on bank loans for funding while big pharma players can finance themselves from cash flows generated from their drug sales.
Cytos' agreement with Pfizer includes vaccines that are outside the scope of the Swiss biotech's research and development program. Cytos still has the right to develop, produce and commercialize vaccines against different disease targets in the same human diseases, it said.The Schlieren, Switzerland-based Company, which currently has five drug candidates in clinical-stage trials, is in partnerships with Novartis to develop nicotine addiction and Alzheimer's disease treatments.