Shares of Inovio Pharmaceuticals (INO) are up for more then 22% today after the company announced a strategic partnership with AstraZeneca (AZN). More specifically Inovio is joining forces with MedImmune, which is the global biologics research and development arm for AstraZeneca.

Under the terms of the deal AstraZeneca will obtain rights to INO-3112. Inovio's INO-3112 vaccine is an immunotherapy that targets two types of HPV: HPV-16 and HPV-18. These two types of HPV are known to target about 70% of pre-cancerous and cancerous cervical tumors. INO-3112 is in phase I/II clinical trials for both cervical cancers plus Head and Neck cancers. 

The reason for AstraZeneca getting into this deal is because it wanted to find a company that could enhance upon its own molecules. Astrazeneca's molecules have been known to function well when enhanced with cancer vaccines. Therefore, AstraZeneca intends to add Inovio's vaccine together with its molecules to produce a more potent compound. 

AstraZeneca will be paying an upfront payment of $27.5 million to Inovio for this collaboration, and an opportunity for Inovio to earn up to $700 million, upon reaching development and commercial milestones. This deal is a good one for Inovio because AstraZeneca will be responsible for all the development costs of this compound, and Inovio will also be receiving double-digit tiered royalties for future sales of this product. 

Additionally AstraZeneca and Inovio will develop two new additional cancer vaccine products which are not currently in Inovio's pipeline. This additional trials will further expand upon Inovio's pipeline even more.