MeiraGTx Holdings plc MGTX is a clinical-stage gene therapy company focused on developing potentially curative treatments for patients living with serious diseases.

The company has six gene therapy programs in clinical development, which are being developed to target ocular indications, salivary gland conditions and neurodegenerative diseases. Management is also evaluating several gene therapy programs in preclinical development targeting other diseases like oncology and metabolic diseases.

Since last month, shares of MeiraGTx have soared 34.5% compared with the industry’s 10.0% rise.

Image Source: Zacks Investment Research

This upside came after management entered into an asset purchase agreement (APA) with Johnson & Johnson JNJ last month to sell the remaining rights in the rare disease gene therapy botaretigene sparoparvovec (bota-vec) for up to $415 million. Bota-vec is currently being evaluated in a late-stage study to treat X-linked retinitis pigmentosa (XLRP), a rare genetic disease that causes blindness in men.

This deal with J&J is an extension of the strategic collaboration between the two companies in 2019 to develop gene therapies for inherited retinal diseases, one of which is bota-vec. MeiraGTx is also developing two other gene therapy candidates, namely AAV-CNGB3 and AAV-CNGA3, for treating achromatopsia (ACHM) caused by mutations in the CNGB3 and CNGA3, respectively.

Per the terms of APA, MeiraGTx will receive $130 million in upfront and near-term milestone payments, including $65 million at the time of signing the agreement and another $65 million in milestone payments receivable on separate occasions before this year’s end. In addition, MeiraGTx is eligible to receive an additional $285 million in cash payments from J&J upon first commercial sales of bota-vec in the United States and Europe and manufacturing technology transfer.

The above transaction is likely to help MeiraGTx monetize the potential future royalties and milestone payments related to bota-vec ahead of the therapy’s commercial roll-out. Management expects that the current cash balance, combined with the initial $130 million payments from J&J, will help MeiraGTx fund its business operations into mid-2026. The current cash balance also includes the recently received $30-million equity investment from Sanofi SNY.

The money received from Sanofi is part of a strategic investment announced in October 2023. Per the transaction terms, Sanofi has the right of first negotiation (ROFN) to use MeiraGTx’s Riboswitch gene regulation technology for programs in immunology and inflammation, central nervous disorders and GLP-1 and other gut peptides for metabolic diseases. The Sanofi deal also includes the xerostomia program.