Focus On Genmab's Pipeline If Darzalex Arbitration with Janssen Goes Sideways: Analyst

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  • Earlier today, Genmab A/S GMAB decided to file a request to review the award dismissing its claims in the second arbitration arising under its license agreement with Johnson & Johnson's JNJ Janssen Biotech Inc for Darzalex (daratumumab).
  • The review of the award will be conducted by a single appeal arbitrator under the rules of the CPR Institute for Dispute Resolution for Non-Administered Arbitration.
  • Friday, Genmab announced an award in the second arbitration arising under its license agreement with Janssen Biotech for daratumumab
  • The arbitral tribunal dismissed Genmab's claims because they should have been brought in the first arbitration. One of the three arbitrators dissented. 
  • Genmab has the right to seek a review of the award, which it must do within a limited time. Genmab is currently considering its options.
  • Genmab's dismissed claims were a claim for milestone payments for the subcutaneous formulation of daratumumab in the U.S. and a new 13-year royalty term, on a country-by-country basis, from the date of the first commercial sale of SC daratumumab in each such country.
  • William Bliar notes that management had been trying to keep expectations in check for a positive decision, and therefore investor expectations were not for a successful arbitration. 
  • Outside of a successful appeal, this now confirms that Darzalex royalties will cease after 2030 and focus shifts on Genmab's pipeline, including upcoming PDUFA date for epcoritamab in relapsed or refractory DLBCL and clinical updates fromGEN1046 and GEN1042 expected this year.
  • The analyst maintains a Market Perform rating on Genmab.
  • Price Action: GMAB shares are up 0.93% at $41.37 on the last check Monday.
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