Johnson & Johnson's Janssen Biotech Inc. agreed to acquire all rights to XBiotech Inc.'s anti-inflammatory antibody bermekimab for $750 million in cash.

Austin, Texas-based XBiotech is developing bermekimab as a potential treatment for different cancer types, diabetes, cardiovascular diseases and skin disorders, including atopic dermatitis or eczema — a chronic condition that makes skin thick, dry, red and itchy — and hidradenitis suppurativa, which causes infected bumps of skin filled with pus and scarring.

In addition to the cash payment, which will be made upon deal close, XBiotech may receive up to $600 million in potential milestone payments. The company anticipates generating additional revenue from its manufacturing supply and clinical services agreements with Janssen for the next two years.

XBiotech will use the transaction's proceeds to fund the discovery and development of new true human anti-IL-1 alpha antibody program. A portion will also go to advancing the company's other antibody therapeutics.

Furthermore, the company will conduct a capital transaction, including a stock repurchase, pending board review and approval, using the proceeds.

Completion of the acquisition is subject to customary closing conditions, including clearance under the Hart-Scott-Rodino Act. The deal will close shortly after antitrust approval, XBiotech said.