A big cash infusion from the drug maker AbbVie Inc. sent shares of Cambridge’s Infinity Pharmaceuticals Inc. soaring more than 44 percent Wednesday as AbbVie stepped up its investing in biotechnology companies in Massachusetts and beyond.
AbbVie, of North Chicago, Ill., agreed to make an upfront payment of $275 million to help Infinity bring a treatment for blood cancers to market.
Thirteen-year-old Infinity could receive up to $530 million more if the drug meets development, regulatory, and commercial milestones, boosting the potential value of the collaboration to $805 million.
The financial commitment by AbbVie, which doesn’t give it an ownership stake in Infinity, will fund several late-stage, global clinical trials of Infinity’s experimental drug, called duvelisib, to treat a range of blood cancers, including a form of non-Hodgkin’s lymphoma and a type of leukemia. It will also free up Infinity to invest in multiple preclinical drug compounds to treat other cancers, as well as inflammation and rheumatoid arthritis.
“It’s a transformative transaction,” said Michael Yee, analyst for the investment bank RBC Capital Markets in San Francisco. “The upfront check for $275 million provides massive resources to help fund Infinity and plan clinical trials going forward. The company was at risk of running out of cash and having to go to the public markets in the next year or so, and this removes that risk.”
Infinity, which does not yet have a drug on the market, has about 180 employees in Cambridge and a half-dozen in Europe. It acquired duvelisib four years ago from Intellikine Inc., of San Diego, and has begun testing it in clinical trials as a monotherapy. That means the drug can be taken by itself, though it ultimately could be used in combination with other cancer medicines. Duvelisib targets cancer cells that cluster in lymph nodes.
“What our drug does is to smoke the cancer cells out of the lymph nodes so they can circulate in the bloodstream where they can be exposed to the body’s immune system and to agents that can kill the cells,” said Infinity’s chief executive, Adelene Q. Perkins.
Perkins said that the goal is to change blood cancers from life-threatening diseases to chronic conditions. Infinity, which is currently enrolling patients in its clinical trials, is expected to provide a timetable next year for filing new drug applications in the United States and in Europe.
Shares of Infinity Pharmaceuticals vaulted $4.81 to $15.73 after the AbbVie collaboration was disclosed Wednesday, a gain of 44.05 percent.
AbbVie is working on drug development programs both in its own research labs and through partnerships with other researchers, said vice president Angela Sekston.
The collaboration with Infinity “really helps us advance our late-stage pipeline with another clinical asset,” she said. “We’re combining our internal strength with outside expertise.”
AbbVie has been striking alliances with biotechs at a blistering pace. It disclosed Wednesday that it also is joining with California Life Sciences LLC, a Google-backed company known as Calico. They will launch a research and development center in the San Francisco Bay area focused on treatments for aging and age-related diseases, including cancer and neurodegeneration.
On July 18, AbbVie agreed to pay nearly $55 billion to buy biotech Shire PLC of Lexington, which makes drugs to treat rare genetic disorders, in the largest life-sciences acquisition of 2014. That deal, expected to be completed in the fourth quarter, was spurred partly by potential tax savings for AbbVie, which will be able to claim Shire’s headquarters in Ireland to lower its corporate tax rate.
AbbVie, which has a manufacturing plant in Worcester, also collaborates with Watertown-based Enanta Pharmaceuticals Inc. Enanta codeveloped a compound that is part of AbbVie’s experimental hepatitis C regimen under review by the US Food and Drug Administration.Robert Weisman can be reached at firstname.lastname@example.org. Follow him on Twitter @GlobeRobW.