AnaptysBio Stock Slides as GSK Lawsuit Threatens Jemperli Royalties
Biotech firm and GSK's Tesaro unit file dueling lawsuits over alleged contract breaches, placing a critical cancer drug revenue stream at risk.
Shares of AnaptysBio (NASDAQ: ANAB) fell sharply on Friday after the biotechnology company became locked in a legal battle with a subsidiary of pharmaceutical giant GSK, threatening a lucrative royalty stream tied to the cancer drug Jemperli.
GSK's unit, Tesaro, initiated litigation against AnaptysBio in Delaware, alleging a material breach of their 2014 licensing agreement. The lawsuit seeks to cut future royalty and milestone payments by 50% and secure a perpetual license to the drug. AnaptysBio immediately fired back, announcing it had filed its own lawsuit against Tesaro and GSK for what it claims are Tesaro’s own contract breaches.
The public dispute sent AnaptysBio shares tumbling more than 11% in pre-market trading, reflecting investor anxiety over the future of a critical revenue source for the company. The stock was trading at $37.66 by mid-morning.
The conflict centers on Jemperli (dostarlimab), a PD-1 inhibitor originally discovered by AnaptysBio and licensed to Tesaro, which GSK acquired in 2019 for approximately $5.1 billion. The drug is a key component of GSK’s oncology portfolio and a significant financial driver for AnaptysBio.
In its complaint, Tesaro claims AnaptysBio breached their agreement, and it is asking the court to validate its right to reduce its financial obligations. In a statement, GSK said it believes AnaptysBio’s allegations of non-compliance are “entirely without merit.”
AnaptysBio’s countersuit alleges that Tesaro violated exclusivity terms by participating in clinical trials with competing PD-1 antagonists, such as Merck's Keytruda. The company also claims Tesaro failed to use “Commercially Reasonable Efforts” to maximize Jemperli's sales, instead favoring other product candidates in GSK’s pipeline.
The financial stakes are substantial. Jemperli royalties have become an increasingly vital part of AnaptysBio’s balance sheet. In the third quarter of 2025, the company reported royalty revenue of $24.9 million, an 80% increase from the same period a year prior. Under the current agreement, AnaptysBio receives tiered royalties ranging from 8% to 25% on global net sales and is anticipating a $75 million milestone payment when Jemperli’s worldwide sales reach $1 billion, an event the company expects in the fourth quarter.
This legal battle introduces significant uncertainty into AnaptysBio's financial projections and complicates its long-term strategy. The company recently announced plans to separate its biopharma operations from its royalty assets by the end of 2026, a move designed to unlock value for shareholders that now faces a considerable legal cloud.
In an apparent attempt to shore up investor confidence amidst the legal turmoil, AnaptysBio also announced a new $100 million stock repurchase plan on Friday morning. While the buyback signals management’s belief in the company's underlying value, the market’s immediate focus remains fixed on the risk posed by the GSK dispute.
While the litigation proceeds, with a trial anticipated in July 2026, royalty and milestone payments are expected to continue. However, the potential for a 50% reduction in this high-margin revenue stream presents a major overhang for AnaptysBio, forcing investors to weigh the company's clinical pipeline against a protracted and costly legal fight.