Three biotech companies regained rights to their programs this week as top pharmaceutical firms sharpened their R&D efforts to focus on core areas they feel offer the best chance of commercial success.
While Pfizer CEO Ian Read told investors he would be cutting as much as $1.4 billion in R&D spending this year [see story], Rigel Pharmaceuticals announced that it would be regaining rights to its R343 program in allergic asthma because Pfizer had decided to exit its research and development in the allergy and respiratory therapeutic area.
The molecule was part of a 2005 licensing deal and equity investment that gave Pfizer access to Rigel’s portfolio of inhaled small molecule syk inhibitors. One year later, Pfizer identified R343 as the lead product candidate for intrapulmonary delivery in the potential treatment of allergic asthma and paid Rigel a $5 million milestone payment.
The compound recently completed several early stage trials that Rigel is evaluating. It expects to design a mid-stage trial with R343 later this year. “It is rare in our business that one has the opportunity to develop an asset which is both promising and on which the research and development has been as well done as the package that Pfizer is transferring to us,” says James Gower, chairman and CEO of Rigel. “R343 will now become Rigel's most advanced in-house project.”
Pfizer was not the only Big Pharma reshuffling its deck. AstraZeneca decided not to exercise its option to license Targacept's experimental drug TC-5619, a highly selective alpha7 neuronal nicotinic receptor modulator, being developed to treat symptoms of schizophrenia and returned full rights to Targacept. AstraZeneca had paid $30 million in 2007 when the deal was struck, and if it had exercised the option it would have committed up to $212 million more based on milestones.
Targacept recently completed two mid-stage clinical trials of TC-5619, one in patients with schizophrenia and one in adults with attention deficit hyperactivity disorder. It is currently being evaluated as a potential treatment in Alzheimer's disease.
Targacept CEO J. Donald deBethizy had already expressed his company’s plan to go it alone in schizophrenia if AstraZeneca opted out. “Our clinical results indicate the unique potential of TC-5619 to treat negative and cognitive symptoms of schizophrenia, a critical need not met by currently available treatments, and we are unwavering in our enthusiasm for the compound,” he said. Burrill & Company, publisher of The Burrill Report, is an investor in Targacept.
The companies renewed their commitment on Targacept’s TC-521, in late stage development as an adjunct treatment for major depression. In March, GlaxoSmithKline ended a potential billion-dollar drug discovery research collaboration with the biotech in neurology and pain.
Sanofi-Aventis walked away from a short-lived collaboration with Metabolex, returning rights to MBX-2982, a selective orally-active GPR119 agonist in mid-stage development to treat type 2 diabetes. Metabolex received an upfront payment at deal signing and was eligible for up to $375 million in milestone payments. Sanofi decided to take a one-time charge to terminate the agreement without giving a reason for its decision. It did say in a regulatory filing that it had seen data from a recently completed trial before making its decision. That trial did not have a negative outcome for safety or efficacy, according to Metabolex.
So far this year, Big Pharma has returned seven programs to its biotech partners as it has struggled to find new ways to deal with its lagging R&D productivity. The trend is likely to continue as companies seek to deal with the loss of revenue from patent expirations. Risk-sharing through option-based and back-end loaded deals is the order of the day. That means a bio-buck today is not what it was yesterday.
DEALS FOR THE WEEK ENDING MAY 6, 2011
| Global Venture Financings | |||
| Company | Location | Amount Raised (USD M) | Principal Activity |
| BioAmber | Minneapolis, MN | 45.0 | Renewable chemicals |
| Crown Bioscience | Santa Clara, CA | 28.8 | CRO |
| Cobalt Technologies | Mountain View, CA | 20.0 | Renewable chemicals |
| Hadron Systems | Princeton, NJ | 5.0 | Neutron therapy |
| Phthisis | Charlottesville, NC | 0.2 | Diagnostics |
| Nanostim | Milpitas, CA | N/A | Pacemakers |
| NeuroVigil | San Diego, CA | N/A | Neurosensors |
| Flexible Stenting Solutions | Eatontown, NJ | N/A | Medical devices |
| ProFibrix | Leiden, the Netherlands | 22.0 | Wound care |
| Delenex Therapeutics | Schlieren, Switzerland | 19.3 | Antibody fragments |
| OrSense | Nes Ziona, Israel | 18.0 | Medical devices |
| Selvita | Krakow, Poland | 5.5 | Drug discovery |
| BeiGene | Beijing, China | N/A | Cancer therapeutics |
| Total Raised US | 99.0 | ||
| Total Raised Non-US | 64.8 | ||
| Grants and Contracts | |||
| Company | Funding Agency | Amount Raised (USD M) | Principal Activity |
| Grants | |||
| Geron | California Institute for Regenerative Medicine | 25.0 | Stem cells |
| Opsona (Ireland) | EU 7th Framework Programme | 8.5 | Organ rejection |
| Cellana | USDA | 5.5 | Animal feed from algae |
| Spring Bank Pharmaceuticals | NIH NIAID RO1 grant over 5 years | 3.9 | Hepatitis B |
| Immunetics | NIH NIAID 3-year Phase II SBIR | 2.4 | Chagas disease |
| Adeona Pharmaceuticals | NIH NINDS | 1.6 | Multiple sclerosis |
| MDxHealth (Belgium) | Eurotrans-Bio | 1.1 | Bladder cancer Dx |
| Biovista | EU 7th Framework Programme p-medicine project | 0.5 | Personalized medicine |
| Contracts | |||
| Emergent BioSolutions | CDC contract expansion | 101.0 | Anthrax vaccine |
| SeraCare Life Sciences | NIH NHLBI year 2 of 5-year | 3.5 | Biorepository services |
| Total Grants and Contracts | 153.0 | ||
| Public Financings | |||
| Company | Ticker | Amount Raised (USD M) |
Financing Type |
| Shenzhen Edan Instruments (China) | SHE:300206 | 146.0 | IPO |
| InspireMD (Israel) | OTC:NSPR | 9.7 | PIPE |
| Marshall Edwards | MSHL | 4.0 | PIPE |
| Response Genetics | RGDX | 2.3 | PIPE--RDO |
| Graymark Healthcare | GRMH | 3.0 | PIPE |
| Alexza Pharmaceuticals | ALXA | 16.1 | PIPE |
| Bacterin International | BONE | 1.9 | PIPE |
| Theravance | THRX | 6.7 | PIPE--GSK buys shares |
| GenSpera | OTC:GNSZ | 2.2 | PIPE |
| Keryx Biopharmaceuticals | KERX | 33.0 | Follow on |
| Silence Therapeutics (United Kingdom) | AIM:SLN | 9.2 | Placing |
| Elekta (Sweden) | Pink:EKTAY | 200.0 | Debt |
| Total Public Financings-US | 69.2 | ||
| Total Public Financings-Non-US | 364.9 | ||
| M&A | |||
| Acquirer | Target | Deal Value (USD M) |
Focus |
| Teva Pharmaceuticals (Israel) | Cephalon | 6,800.0 | Biopharmaceuticals |
| INC Research | Kendle International | 232.0 | CRO |
| Techne | Tocris (United Kingdom) | 124.0 | Tools/Technology |
| Akorn | Advanced Vision Research | 26.0 | OTC ophthalmic |
| Isconova (Sweden) | Nordic Vaccine (Denmark) | 0.6 | Vaccine delivery |
| PerkinElmer | Geospiza | N/A | Tools/Technology |
| Alliances | |||
| Company/Licenser | Company/Licensee | Deal Value (USD M) |
Focus |
| Molecular Partners (Switzerland) | Allergan | 420.0 | Ophthalmic license |
| Wilex (Germany) | Prometheus Laboratories | 145.0 | Oncology license |
| ARCA biopharma | Novartis (Switzerland) | 17.5 | Technology license |
| Dyadic | Sanofi Pasteur (France) | N/A | Vaccine collaboration |
| Icagen | Yale University School of Medicine and Pfizer | N/A | Pain drug collaboration |
| Molecular Templates | Alnylam Pharmaceuticals | N/A | RNAi delivery collaboration |
| Solazyme | Bunge | N/A | Renewable oils production agreement |
| Sichuan University West China School of Stomatology (China) | C3 Jian | N/A | Clinical research partnership |
| Yale School of Medicine | Debiopharm (Switzerland) | N/A | Inflammation drug license |
| University of Miami | InVivo Therapeutics | N/A | Orthopedic collaboration |
| King's College London (United Kingdom) | Sigma-Aldrich | N/A | Diagnostics license |
May 06, 2011
http://www.burrillreport.com/article-losing_biobucks_as_pharma_reshuffles_its_deck.html