Dec. 27 (Bloomberg) -- Karo Bio AB, a Swedish biotech company, rose the most since it started trading in 1998 after it signed a research pact with Pfizer Inc. regarding autoimmune diseases such as multiple sclerosis and rheumatoid arthritis.
The agreement could give Stockholm-based Karo Bio as much as $217 million in upfront and milestone payments in addition to potential royalties, the company said in a statement on Dec. 24. The share rose as much as 80 percent and traded 66 percent higher at 1.67 kronor as of 11:01 a.m. in Stockholm.
Pfizer and Karo Bio will collaborate on discovering and developing small molecule RORgamma modulators. RORgamma directly controls production of the cytokine IL-17 which is a major contributor to inflammation and Karo Bio has discovered new RORgamma modulators within its own program, the company said.
“This partnership secures a pole position within this new and rapidly evolving area of autoimmune diseases,” Karo Bio’s Chief Executive Officer Per Bengtsson said. “It also confirms the commercial value of Karo Bio’s leading position in the nuclear receptor drug development field.”
Pfizer will fund the research and have exclusive marketing rights to potential new products resulting from the collaboration, Karo Bio said.
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