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Genentech Retains Rights to Relay Therapeutics' SHP2 Inhibitor

NEW YORK – Cambridge, Massachusetts-based Relay Therapeutics has inked a worldwide licensing agreement with Roche subsidiary Genentech to develop and commercialize its investigational SHP2 inhibitor RLY-1971.

Under the terms of the agreement, Genentech will pay Relay $75 million upfront, and up to $25 million in near-term payments. Relay also has a 50/50 profit and cost sharing option for RLY-1971 and if the company decides to exercise this option, it will receive up to $410 million in commercialization and sales-based milestone payments on ex-US sales, and royalties on net sales of the drug in ex-US markets. If Relay chooses not to exercise this option, it can receive up to $695 million in additional milestone payments, as well as royalties on global net sales in the low-to-mid teens.

RLY-1971 entered a Phase I clinical trial earlier this year for patients with solid tumors and is designed to bind to SHP2, a protein that helps cancer cells proliferate through the RAS pathway. Genentech will take over development of RLY-1971 and study it in combination with other drugs, such as its KRAS G12C inhibitor GDC-6036. However, Relay maintains the right to study RLY-1971 in combination with its FGFR2 and mutant-selective PI3Ka inhibitors.

"Genentech has a longstanding commitment to understanding the underlying biology of KRAS, the most commonly mutated oncogene and an important driver of cancer growth," James Sabry, global head of pharma partnering at Roche, said in a statement. "We believe that the combination of KRAS G12C and SHP2 inhibitors together represents a promising approach that we hope could become a new treatment option for patients with KRAS G12C mutant tumors."

If the RLY-1971 and GDC-6036 combo receives regulatory approval, Relay can receive additional royalties.

With the funds from this collaboration, Relay has cash and investments to support its business through 2024.