Deals Of the Week: Merck-Parexel; Biotie-Synosia And More...

The setback in Merck & Co.'s Phase III program for its anti-platelet drug vorapaxar and the annual J.P. Morgan health care conference dominated this week's biopharma news, but they weren't the only news of note.

To be sure, the news flow from the J.P. Morgan was relentless, and the negative news on vorapaxar took wind out of Merck's seemingly full sail, leaving analysts to re-assess the company's risk profile. But Merck and others are still delivering on deals, many of which underscore significant trends emerging in 2010, including growing interest in risk sharing (the Lilly-Boehringer deal highlights that trend spot on), outsourcing, industry-academia partnerships, and early-stage cross-company collaborations. With this week starting off with a federal holiday in the U.S., here's some noteworthy deals, with strategic themes we can expect to see more of:

Merck/Parexel International: Merck was one of the first companies to announce a strategy for bringing low-cost biologic copies to market after U.S. healthcare reform provided a clearer regulatory path for biosimilars. It announced the formation of a BioVentures unit in December 2008, with plans to put at least six biosimilars in development by 2012. It has kept close to the vest details of its target priorities, however, noting publicly only its interest in Amgen's granulocyte colony-stimulating factors Neupogen (filgrastim) and Neulasta (pegfilgrastim).

Now, the Big Pharma has struck a partnership with clinical research organization Parexel International Corp. in which the CRO will conduct clinical trials for some of Merck's biosimilar programs. True to form, the companies won't say which therapeutic areas are covered by their collaboration, however. "One of the things that was exciting for us is that we were able to build a deal structure with Parexel in which they are rewarded for performance," Merck BioVentures President Michael Kamarck told "The Pink Sheet" DAILY. "In the biosimilars arena, time is everything, so...they will rpovide us with timeliness, and efficiency in execution of trials." -- Lisa LaMotta.

Biotie Therapies/Synosia Therapeutics: An all-European "global leader" in CNS drug development will be born out of the proposed $120 million combination of Finland-based Biotie Therapies and Switzerland-based Synosia Therapeutics. Following Biotie's all-share acquisition of Synosia, announced Jan. 11, the combined entity will have nine CNS products in clinical development, including the Phase III alcohol dependence product nalmefene, which partner Lundbeck is developing, and a Parkinson's disease-movement disorder therapy, which Synosia has been developing in collaboration with UCB Pharma.

Under the agreement, likely to close shortly after a shareholder's meeting on Feb. 1, Biotie will issue 161,448,371 shares to shareholders and warrant holders of privately owned Synosia. Shareholders, including Versant Ventures, Abingworth LLP, Novo AS, and UCB SA, will therefore control 50% of the company. The agreement comes just in time for Biotie, which had liquid assets of only $11.9 million at the end of the 2010 third quarter. The move boosts a therapeutic sector which has seen companies taking divergent views on its prospects -- some, like GlaxoSmithKline PLC, have exited several areas of CNS, while others, like Biogen Idec, are making the field a core focus -- John Davis.

Takeda San Francisco/ Pieris AG: The antibody-focused North American subsidiary of Japan's Takeda Pharmaceutical Co. Ltd., has agreed to license the protein scaffold technology of privately-held Pieris AG to identify drug candidates around a target of Takeda's choosing. Financial terms were undisclosed, although Takeda says it will have an option to advance at least one drug candidate on its own. Pieris maintains a proprietary library of recombinantly-engineered lipcalins, proteins, which bind with and transport a range of hydrophic molecules. Those proteins, which it has named Anticalins, form the basis of the Takeda deal. The company also licensed its ANticalin platform in a multi-target deal with Sanofi-Aventis SA and its vaccines division Sanofi Pasteur in September. Backed by venture investors including OrbiMed Advisors and Global Life Science Ventures, Pieris has its own pipeline as well, including a Phase I anti-VEGF candidate. -- Paul Bonanos.

Bristol-Myers/Pharmasset: Bristol-Myers Squibb Co. and Pharmasset Inc. have teamed up in a clinical partnership that marks the first cross-company collaboration to study two investigational oral drugs for the treatment of hepatitis C. The firms announced plans to study Bristol's NS5A replication complex inhibitor BMS-790052 and Pharmasset's nucleotide polymerase inhibitor on Jan. 10.

Drug makers do not generally collaborate on clinical trials for investigative drugs for competitive reasons and tend instead to study combinations within their own pipelines or with at least one already marketed drug. Regulatory uncertainties and, perhaps, just as important, cultural resistance, also present hurdles. But novel-novel combinations increasingly are viewed as the best way to treat certain serious diseases, like cancer and hepatitis C, and have become more common.

In hepatitis C specifically, the primary drug development focus is on combinations that could replace or reduce the use of the current standard of care, ribavirin and pegylated interferon (Roche's Pegasys or Merck's Pegintron), a regimen with a hasty side effect profile and limited efficacy. Bristol's decision to sign a clinical trial collaboration rather than in-licensing a polymerase inhibitor is intersting since the company recently acquired its hepatitsi C partner ZymoGenetics to gain more control over the program. -- Jess Merrill