Shares of Arvinas Inc (NASDAQ:ARVN) opened higher in premarket trading Tuesday, climbing 4.3% after the company and Pfizer Inc (NYSE:PFE) announced a licensing arrangement with Rigel Pharmaceuticals centered on VEPPANU (vepdegestrant), the first PROTAC therapy approved by the U.S. Food and Drug Administration.
Under the agreement, Rigel will hold exclusive global development, manufacturing and commercialization rights to VEPPANU. The drug is approved for adults with ER+/HER2-, ESR1-mutated advanced or metastatic breast cancer. Rigel will manage the U.S. launch and commercialization and will possess global rights with the option to sublicense markets outside the U.S.
Financial consideration for Arvinas and Pfizer includes a $70 million upfront payment plus an additional $15 million payable upon completion of specified development and manufacturing transition activities. The upfront and the transition payment will be split evenly between Arvinas and Pfizer. The companies may also receive up to $320 million in further development, regulatory and commercial milestone payments, in addition to tiered royalties on net sales ranging from the mid-teens to the mid-20s.
Per the contract terms, Rigel will assume responsibility for the launch and commercialization in the United States and retain global rights, including sublicensing authority for markets beyond the U.S. Arvinas and Pfizer will continue to handle ongoing development activities currently in progress, and Rigel has committed up to $40 million to support those activities.
On May 8, 2026, the National Comprehensive Cancer Network added vepdegestrant to its Clinical Practice Guidelines in Oncology for Breast Cancer as a Category 2A treatment option, a regulatory and clinical guideline update noted alongside the transaction.
Separately, Arvinas reported first-quarter results showing adjusted earnings per share of ($0.90), slightly better than the analyst consensus of ($0.93). Quarterly revenue was $15.6 million versus the consensus expectation of $17.16 million. The company stated that its cash, cash equivalents and marketable securities as of March 31, 2026, are sufficient to fund planned operating expenses and capital expenditure requirements into the second half of 2028.
Completion of the licensing transaction remains contingent on required regulatory approvals, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.
This deal shifts commercial responsibility for VEPPANU to Rigel while preserving Arvinas and Pfizer roles in current development efforts and creates a structured payout profile of upfront payments, transition funding, milestone potential and tiered royalties. Market reaction was positive for both companies on the announcement, with Arvinas registering a larger premarket move.