Vaxcyte, Inc. and Sutro Biopharma, Inc. announced that Vaxcyte has exercised its option and entered into a manufacturing rights agreement with Sutro to obtain control over the development and manufacture of cell-free extract, a key component of Vaxcyte's pneumococcal conjugate vaccine (PCV) franchise, which includes VAX-24 and VAX-31. Pursuant to the manufacturing rights agreement, Vaxcyte obtained exclusive rights to independently, or through certain third parties, develop, improve and manufacture cell-free extract for use in connection with the Company's vaccine candidates. Upon exercising the option, which was granted pursuant to the December 2022 option grant agreement between the parties, Vaxcyte paid Sutro $50 million in cash and is obligated to pay Sutro an additional $25 million in cash within six months.

Upon the occurrence of certain regulatory milestones, Vaxcyte would be obligated to pay Sutro certain additional milestone payments totaling up to $60 million in cash.