Agenus Inc. (NASDAQ:AGEN) Deal With Incyte Corp. (INCY) Looks Good

Agenus Inc. (NASDAQ:AGEN)

Shares of small-cap Agenus Inc. (NASDAQ:AGEN) are up, on heavy volumes, on news that Incyte Corporation (NASDAQ:INCY) has essentially substituted a development and commercialization agreement into what essentially amounts to a “Call” option on future revenues of Agenus’ drugs GITR and OX40. The new agreement gives all future development and commercialization responsibilities to Incyte. Agenus receives a $28 million up-front payment and royalty payments on 15% of global net sales. AGEN shares are up over 10%. The ongoing TIM-3 and LAG-3 antibody programs remain royalty-bearing programs, at tiered rates of 6 to 12 percent, with Incyte retaining exclusive world-wide clinical development and commercial responsibilities. Also released this morning was news that Incyte would buy 10 million shares of AGEN at $6/share.

Lexington, MA-based Agenus Inc. (NASDAQ:AGEN) discovers and develops cancer treatments that engage the body’s immune system. Incyte Corporation (NASDAQ:INCY), based in Wilmington, DE, is a $23 billion company discovers, develops, and commercializes proprietary therapeutics in oncology in the United States and internationally.

Agenus Inc. (NASDAQ:AGEN) has an impressive amount of product in their pipeline. Five drugs are in pre-clinical data gathering. Four are in Phase 1 clinical trials, one is in its Phase 2 clinical trial, and two are completing their Phase 3 trials.

In 2014 Agenus Inc. (NASDAQ:AGEN) reported sales of just $7 million but in 2015 that figure improved to $24.8 million. However AGEN shareholders have experienced EPS losses for the past five years – $1.21, $$0.51, $1.12, $0.71, and $1.13 in 2015. Four analysts cover AGEN and three rate the shares as a “Strong Buy” while one rates AGEN shares as a “Hold”.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

Ticker Symbol AGEN
Last Price a/o 10:47 AM EST  $                      4.62
Average Volume                1,030,000
Market Cap (mlns)  $                  354.07
Sales (mlns) $24.60
Shares Outstanding (mlns) 85.94
Share Float (mlns) 81.86
Shortable Yes
Optionable Yes
Inside Ownership 1.60%
Short Float 15.21%
Short Interest Ratio 12.08
Quarterly Return -20.16%
YTD Return 0.00%
Year Return 45.58%