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Invenra, a Madison company working on drugs to fight cancer, is teaming up with Exelixis, a California cancer drug company, in a deal that could bring Invenra as much as $325 million — or more — if the collaboration develops a next-generation drug that makes it through research, testing and all the way to the market.

Invenra works with antibodies — proteins produced by the body’s immune system to fight diseases. Its antibodies can target two locations on a cancer cell, instead of just one, giving them the potential to be more effective. They also appear more natural, Invenra CEO and co-founder Roland Green said.

“You want to hew close to nature. The more alien your molecule looks, the more likely the body is to reject it,” Green said.

Invenra also has a platform that can rapidly analyze a large number of antibodies and find the ones most likely to get a patient’s immune system to activate T cells, a type of white blood cell that can attack cancers.

Under the arrangement with Exelixis, Invenra will do the research and develop a lead molecule and conduct preliminary studies. Then Exelixis will pursue the more time-consuming and expensive next steps, including clinical trials with patients and applying for U.S. Food and Drug Administration approval if the potential drug is effective.

If things go well, it could be two years or less for the first drug to go into clinical trials, Green said. Getting it to market could be another seven years.

The agreement is for three “discovery programs” — or approaches to fighting cancer — that could produce multiple prospective drug candidates.

Invenra will be paid $2 million at the start, and for each drug discovery project Invenra initiates, the Madison company will get another $2 million plus potential millions more in milestone payments as the prospect moves through the process.

If a drug makes it to market and reaches certain sales goals, Invenra could be paid up to an additional $325 million, plus royalties.

“It’s a nice number,” Green said.

Invenra, at 505 S. Rosa Road in University Research Park, was founded in 2012 and has 18 employees. Green said he plans to be up to 30 employees by the end of the year, and perhaps 35 a year from now. He also is looking to double or triple Invenra’s current 6,000 square feet of lab and office space.

Exelixis, founded in 1994, is in South San Francisco and has 350 employees. The publicly traded company reported $452 million in revenue in 2017 and appears on track to top that this year. First-quarter 2018 revenue was $212 million, with profits of just under $116 million for the quarter.

Exelixis has three drugs on the market: Cometriq, approved in 2012 to treat a form of thyroid cancer; Cabometyx, approved in 2016 to treat advanced kidney cancer; and Cotellic, approved in 2015 for use with Zelboraf, a Genentech drug, to fight a certain form of melanoma.

“We’re very excited to partner with Exelixis,” Green said. “We think it’s validation of the technology and the team.”

Invenra also has a partnership with Merck, one of the world’s leading pharmaceutical companies, for a disease target that has not been publicly disclosed, and Green said the Madison company continues to pursue its own drug prospects that have shown potential for certain types of lung cancer and breast cancer and brain tumors.

Down the road, “there are a lot of additional opportunities we have our eyes on. We expect a bright future,” Green said.