Compugen restructures AstraZeneca deal to boost cash coffers

Israeli drug discovery and development company Compugen (Nasdaq: CGEN; TASE: CGEN) today announced changes in its commercialization deal with AstraZeneca. As part of the change, the company will convert part of the potential future royalties it would be entitled to into immediate cash.

Compugen will receive $65 million immediately and another $25 million if it meets a relatively close milestone, and this cash should be enough to finance the company’s operations until 2029. In return, if the product is successful, it will be entitled to receive slightly lower royalties from AstraZeneca than stipulated in the original agreement.

Following the announcement, Compugen shares are now rising by about 16% on the Tel Aviv Stock Exchange (TASE).

Promising product

Compugen is developing drugs for the treatment of cancer, specifically cancer treatment using the immune system (immunotherapy), based on a computational biology system that it has been developing since the 1990s. It does not yet have a steady revenue stream from its products, but over the years it has signed a number of strategic agreements with pharmaceutical companies, which fund and conduct trials of its products with the aim of marketing them later and sharing the royalties.

The product that Compugen transferred to AstraZeneca is also considered a promising product by the UK biopharmaceutical company, and it is conducting 11 clinical trials on it in various types of cancer, including lung cancer, gastrointestinal cancer and endometrial cancer.

This is an antibody that simultaneously attacks both a popular target in the field of immunotherapy, PD1, and another target for which Compugen competes with a small number of other companies, TIGIT. Compugen believes that the TIGIT component of the product, which it developed itself, is the best in the category.

Compugen stresses that it keeps most of the future royalties from the product. It will receive $195 million for meeting various milestones, plus mid-single-digit revenue royalties. $25 million of the potential $195 million was advanced under the current deal, which will now be paid if and when the product is submitted for approval by the FDA.

Under the agreement signed in 2018, Compugen was supposed to receive up to $200 million in milestone payments as well as royalties from the product that increase based on success. In other words, the main component it is giving up is probably the high royalties in the event of a very major success. Compugen has already received $40 million in cash as part of the deal around this product.

More royalties on the way?

Compugen also has another major strategic agreement with Gilead Sciences, in which it has received $60 million, and it could receive an additional $30 million at an upcoming milestone and up to $758 million in milestone payments and royalties in the event of the product’s success.

In addition, the companyu has two of its own standalone products in clinical trials and an earlier product pipeline. The amount raised in this deal is expected to allow it to continue developing mainly its standalone products.

Compugen had $86.1 million in cash at the end of the third quarter, which the company said would have been enough to last until mid-2027. This was prior to signing the current deal.

This move is the first significant business move by incoming CEO Dr. Eran Ophir, who replaced Dr. Anat Cohen-Dayag in May, after she served as CEO of Compugen for about 15 years. Cohen-Dayag is currently the company’s chairperson.

Published by Globes, Israel business news – en.globes.co.il – on December 17, 2025.

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