June 18 (Reuters) - U.S. drugmaker Pfizer, which failed last month in a $118 billion bid to buy AstraZeneca , said on Wednesday it had signed a deal with French biotech Cellectis to develop immunotherapy drugs in cancer.

Boosting the body's immune system to fight tumours is a hot area for drug research and was one of the factors that attracted Pfizer to Britain's AstraZeneca - along with the potential to cut costs and taxes.

Under the new deal, Cellectis will receive an upfront payment of $80 million, as well as funding for research costs.

The French biotech firm will also be eligible to get development, regulatory and commercial milestone payments of up to $185 million per Pfizer product, plus tiered royalties on any eventual sales.

Pfizer has exclusive rights to develop products against 15 biological targets for fighting cancer it selects, while another 12 targets can be selected by Cellectis.

In addition, Pfizer will buy a stake of about 10 percent in Cellectis through newly issued shares at 9.25 euros each.

Cellectis is developing so-called Chimeric Antigen Receptor T-cell, or CAR-T, immunotherapies using engineered cells from a single donor for use in multiple patients.

(Reporting by Ben Hirschler; Editing by Pravin Char)