What happened Shares of Fate Therapeutics (NASDAQ: FATE) dropped nearly 24% last month, according to data provided by S&P Global Market Intelligence. That was almost twice the fall of the S&P 500, which declined 12.5% in March due to the abrupt uncertainty ushered in by the coronavirus pandemic. Investors can't be too surprised by the stock's fall. Fate Therapeutics is a development-stage company with no product revenue. What's more, shares had gained nearly 80% from September 2019 through February of this year on promising clinical data, albeit from early stage studies. In other words, the pharma stock had plenty of fragile gains to give back, although it clawed its way back in early April on the heels of a lucrative partnership. Image source: Getty Images. So what In early April, Fate Therapeutics announced a collaboration with Johnson & Johnson subsidiary Janssen Pharmaceutica. The deal included a $50 million equity investment and a $50 million up-front cash payment. Fate Therapeutics is also eligible to receive up to $1.8 billion in development and regulatory milestone payments, up to $1.2 billion in commercial milestone payments, and double-digit royalties on future sales. Bringing a deep-pocketed partner on board helps to significantly de-risk operations. Fate Therapeutics might now have a substantial revenue stream to use as it develops wholly owned assets. Considering the company lists 13 unique pipeline programs on its website, there are plenty of wholly owned assets in need of funding. Now what Fate Therapeutics maintains an above-average risk profile. After all, none of the programs being pursued with Janssen are guaranteed to work, although the development-stage company should be able to wrangle a decent amount of payments out of the collaboration just for advancing assets into clinical trials. Investors should also prepare for the company's ongoing clinical trials to be delayed or disrupted by the coronavirus pandemic, but the long-term potential of the pipeline remains intact. 10 stocks we like better than Fate TherapeuticsWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Fate Therapeutics wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of March 18, 2020 Maxx Chatsko owns shares of Fate Therapeutics. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy.Source