Foghorn Therapeutics Surges

Loxo Oncology, an R and D group of Eli Lilly ($LLY@US), and Foghorn Therapeutics ($FHTX@US) have collaborated to create oncology medicines by applying Foghorn’s Gene Traffic Control platform. The collaboration includes a co-development and co-commercialization agreement for Foghorn’s selective immunotherapy program and an additional undisclosed oncology target. The companies will also work together on 3 additional discovery programs using Foghorn’s Gene Traffic Control platform. Under the agreement terms, Foghorn will receive upfront consideration of $300 million in cash and an equity investment by Lilly of $80 million at $20 per share. Foghorn and Lilly will share 50-50 in the U.S. economics, and Foghorn is eligible to receive royalties on ex-U.S. sales. Foghorn will lead discovery and early research activities for the additional discovery program, and it may receive up to a total of $1.3 billion in potential development and commercialization milestones. Foghorn shares are up more than 37% at $16.50. Lilly stock was up 0.35% at $245 during the premarket session this morning.