London-listed Avacta Group (AIM:AVCT) has established a joint venture to develop next generation cell and gene therapies using the group’s Affirmer proteins.
The group entered the JV with Daewoong Pharmaceutical, a leading Korean pharmaceutical company, who have agreed to cover all research and development costs.
The JV, in which Avacta will have a 45% equity interest in, will target the development of a new class of mesenchymal stem cells (MSCs) that are primed to produce Affimer proteins.
Avacta is a specialist in developing Affimers proteins, affinity agents which help target diseases more effectively by reducing inflammatory and autoimmune responses in patients.
Under the JV, Avacta will provide Affimers against a number of undisclosed targets which will be incorporated into Daewoong’s stem cells.
Shares in Avacta Group were trading 7.71% higher at 18.85p at Wednesday midday.
“Cell and gene therapies are attracting intense clinical and commercial interest,” said Dr Alastair Smith, Chief Executive Officer of Avacta Group.
The group say they believe the JV will open up new opportunities to generate superior cell therapy treatments for immune-mediated diseases.
The engineered cell therapy area has seen substantial M&A activity, including Bayer’s recent $600m acquisition of Blue Rock, which the group considers an indication of potential value.
Avacta have also said they will retain their right to commercialise the Affirmer proteins outside the stem cell therapy field which broker finnCap sees as further validation of the group's technology.
Commenting on the joint venture, Dr Seng-ho Jeon, CEO of Daewoong Pharmaceutical added, "This innovative collaboration will deliver invaluable synergy and lead to new solutions to transform patients' lives."
In a morning research note, finnCap reported no change to its forecasts and repeated its 76p target price on Avacta shares.
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