(Reuters) - Shares of Momenta Pharmaceuticals (MNTA.O) rose as much as 7 percent early Friday, a day after it inked a deal with Baxter International Inc (BAX.N), marking the third partnership on generic versions of biotechnology drugs this month.
Momenta will receive an upfront payment of $33 million from Baxter for developing up to six biosimilars, and is entitled to additional milestone payments.
The deal also includes Momenta receiving royalties with a profit-share option on four drugs, for which Baxter will cover clinical trials, manufacturing and commercialization, according to Canaccord Genuity analyst Ritu Baral.
The analyst, who has a price target of $23 on Momenta stock, reiterated her "buy" rating.
Momenta and Baxter's deal comes just days after Amgen Inc (AMGN.O) and generic drugmaker Watson Pharmaceuticals Inc (WPI.N) announced a partnership to develop and sell biosimilars of cancer drugs.
Earlier in the month, Samsung announced an agreement with biotechnology company Biogen Idec (BIIB.O) to set up a joint venture for developing, manufacturing and marketing biosimilars.
Biosimilars are copies of existing biotechnology products developed from organic compounds. However, due to the complex nature of these compounds, biosimilars have come under the regulatory scanner.
Companies hoping to cash in on a potential multi-billion dollar market for biosimilars have long awaited guidelines from the U.S. Food and Drug Administration on the development of such drugs.
Analyst Baral said the slew of deals on biosimilars follows increased FDA clarity on the regulatory path.
Shares of Cambridge, Massachusetts-based Momenta were up 4 percent at $17.63 on Friday morning on Nasdaq.
(Reporting by Zeba Siddiqui in Bangalore; Editing by Roshni Menon)