Why Shares Of Array Biopharma Are Surging More Than 35%

Shares of Array BioPharma Inc ARRY were surging more than 30 percent on Friday after the company announced it has acquired the worldwide rights to Novartis' NVS encorafenib, a BRAF inhibitor currently in a Phase-3 development for the treatment of melanoma.

Array will make a de minimis payment to Novartis and has no obligations to offer any milestone payments or royalties. Novartis will provide transitional regulatory, clinical development and manufacturing services and will assign or license to Array all patent and other intellectual property rights it owns.

"Acquiring worldwide rights to encorafenib, an innovative late-stage oncology product, represents a tremendous opportunity for Array," said Ron Squarer, Chief Executive Officer, Array BioPharma. "There are currently eleven active encorafenib clinical trials, including the Phase 3 COLUMBUS trial in which encorafenib is being studied in combination with binimetinib for BRAF+ melanoma patients. With rights to both encorafenib and binimetinib, Array would enhance its position to broadly develop and commercialize each product, as well as this MEK/BRAF combination, which may have differentiating advantages when compared to available therapies."

Array has agreed to seek out an experienced partner for global development and European commercialization of both binimetinib and encorafenib. If it is unable to find a suitable partner, the company has agreed to enlist a trustee to sell the European rights.

Array traded recently at $6.98, up 38 percent.