Oruka Therapeutics, Inc. (NASDAQ:ORKA), a biopharmaceutical company with a market capitalization of $753 million and strong financial health according to InvestingPro analysis, has entered into a significant licensing agreement with Paragon Therapeutics, Inc., securing exclusive rights to develop and commercialize certain antibodies targeting IL-23, excluding inflammatory bowel disease.
The deal, formalized on December 17, 2024, could total up to $22.0 million in milestone payments to Paragon, including immediate obligations like a $1.5 million fee for the nomination of a development candidate and $2.5 million upon the first human dosing in a Phase 1 trial. The company maintains a strong balance sheet with more cash than debt, positioning it well for these financial commitments.
The agreement grants Oruka Therapeutics a worldwide, royalty-bearing license to Paragon’s patents related to these antibodies, including their use and manufacturing methods. Paragon has also agreed not to generate any new anti-IL-23 monospecific antibodies in the specified field for a minimum of five years.
Oruka Therapeutics will pay Paragon a low single-digit percentage royalty on sales of antibody products. The royalty payment structure includes a step-down provision if no relevant Paragon patent is in effect. The royalty term is set to expire on the later of the last-to-expire licensed or company patent or 12 years from the first product sale.
In other recent news, Oruka Therapeutics has seen significant developments in its clinical trials and corporate affairs. The company has announced the initiation of a Phase 1 trial for ORKA-001, with interim data expected in 2025, and initial clinical efficacy data for psoriasis patients anticipated in 2026. Another candidate, ORKA-002, is set for a Phase 1 trial in the third quarter of 2025, with interim results expected in 2026.
In corporate developments, Oruka Therapeutics has secured $200 million in private investment in public equity (PIPE) financing from Braidwell LP and Venrock Healthcare Capital Partners (WA:CPAP). The company has also adjusted its financial statements following a recent merger and a 1-for-12 reverse stock split.
Furthermore, Oruka Therapeutics gained approval for the conversion of Series A Non-Voting Convertible Preferred Stock into common stock, a move expected to increase the number of the company’s common shares in the market.
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