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Tesaro Rises on $85 Million J&J Cancer Drug Licensing Deal

  • Deal includes J&J purchase of $50 million in Tesaro stock
  • Tesaro can receive up to $415 million more in milestone fees
Updated on

Shares of Tesaro Inc. gained in New York trading Wednesday after the drugmaker said Johnson & Johnson will pay $85 million for rights to develop and sell its experimental pill for prostate cancer, a disease area where J&J is looking to defend its dominance.

J&J will invest $50 million in Tesaro stock, paying $44.24 a share, and will pay $35 million in cash up front for rights to the cancer drug, called niraparib, according to a statement Wednesday. Waltham, Massachusetts-based Tesaro may also get as much as $415 million in potential milestone payments from J&J.