Swiss drugmaker Novartis will pay up to $2.9 billion for PTC Therapeutics' promising experimental drug for a neurological disorder called Huntington's disease, sending the U.S.-based biotech's shares up about 14% on Monday.

Novartis will make an upfront payment of $1.0 billion to PTCT and the latter will also be eligible for up to $1.9 billion in development, regulatory and sales milestones. NVS will also share profits in the United States (40% PTC and 60% Novartis) and pay tiered royalties on ex-US sales.

Novartis is paying $1 billion upfront in a licensing deal for an experimental Huntington’s disease treatment from PTC Therapeutics.

Novartis is paying $1 billion upfront for global rights to PTC Therapeutics’ midphase Huntington's disease program, helping the biotech bounce quickly back from disappointing data on another program.

Monday’s agreement comes days after PTC discontinued the development of another asset, utreloxastat, due to disappointing Phase II data in amyotrophic lateral sclerosis.

PTC Therapeutics has signed an up to $2.9 billion licensing deal with Novartis AG for the U.S. company's experimental drug for a rare neurological disorder, sending its shares up 20% in premarket trading on Monday.

Key Takeaways Shares of PTC Therapeutics soared Monday when the pharmaceutical firm announced it struck a nearly $2 billion license and collaboration deal with Novartis.The deal gives Novartis global development,