Sacre bleu! For oncology drug developer Exelixis, le quatorze juillet brought the wrong kind of liberation. In a regulatory filing, Exelixis revealed that longtime partner Bristol-Myers Squibb has terminated the companies’ licensing agreement around XL281, freeing up rights to the Phase I RAF kinase inhibitor studied in patients with solid tumors. BMS’s decision spells the end of the companies’ December 2008 alliance that covered two drugs, for which BMS paid $240 million in up-front and near-term fees. Left unpaid will be a lot of biobucks: $315 million in development and regulatory milestones, $150 million in sales milestones, and double-digit royalties. The partnership officially ends in October.
Hewing to its chosen strategy, Exelixis won’t enjoy XL281’s newfound liberty. But if there's a silver lining for Exelixis, it's that the company will receive the remaining unpaid $120 million of the up-front component by October, rather than on a deferred schedule that would have drawn out payments until April 2014. That gives the company a little more cash to put behind primary program cabozantinib, the compound formerly known as XL184, which interestingly was also part of the bitoech's mammoth 2008 alliance with BMS.
Exelixis also recovers full control of XL281, which its well-heeled business development team could partner away again. After all, BRAF remains a hot target, and nearly every pharma has identified oncology as a core pursuit.
Cabozantinib still has its risks, of course. BMS walked away from the drug last June, becoming the second Big Pharma to do so: GlaxoSmithKline lost interest in it in 2008 as well, effectively ending its six-year partnership with Exelixis. Cabozantinib has shown strong promise in prostate cancer, where it’s thought to be a potential blockbuster. The candidate is farthest along in medullary thyroid cancer, although Exelixis said last week that results of a Phase III study in MTC would be delayed for three months.
BMS and Exelixis have been moving apart in oncology for some time. Last fall, BMS waived its option on the last compound of a three-drug oncology agreement, after one of the others failed. Exelixis also opted out of a collaborative agreement on BMS-833923, formerly XL139, leaving further development to BMS. The two companies still have tie-ups covering diabetes and inflammatory diseases, based on new agreements forged in October that brought Exelixis $60 million in up-front payments.
From those of us in the Fourth Estate to the rest of you, we hope you’ve got a free moment for this week’s installment of…Valeant/Dermik and Valeant/Ortho Dermatologics: Canadian specialty pharma Valeant Pharmaceuticals may not have been able to take out Cephalon in a hostile bid this spring, but the company hasn’t lost its appetite for acquisitions. The company made two major moves in dermatology this week, snapping up both Sanofi-Aventis’ Dermik unit for $425 million and Janssen Pharmaceuticals’ Ortho Dermatologics subsidiary for $345 million. Dermik markets a small portfolio of creams and lotions as well as the injectable Sculptra Aesthetic, for correcting facial wrinkles and folds, and comes with its own manufacturing and packaging facility in Laval, Quebec. The facility produces 70 formulations and more than 200 presentations of tablets, capsules, non-sterile liquids, ointments and creams, for itself and for other companies. Sanofi was magnanimous about selling the unit, waving it off with glad tidings: "Dermik will benefit from being part of a larger dermatology business," it commented. Ortho manufactures Retin-A-Micro and Renova, two formulations of tretinoin for acne, as well as Ertaczo (sertaconazole) for athlete’s foot. Dermik brought in $240 million in sales in 2010, while the J&J unit took in $150 million. Valeant also acquired North American rights to dermatitis cream Elidel (pimecrolimus) from Sweden's Meda AB in late June. - John Davis and Paul Bonanos
Array/ASLAN: When it raised a $12 million Series A round of funding in April, Singapore-based ASLAN Pharmaceuticals said its business model would involve in-licensing early-stage drug candidates, developing them to the proof-of-concept stage, and out-licensing them to larger pharma partners. Now the young start-up has found its first candidate in Array BioPharma’s ARRY-543, a molecule being studied for gastric cancer with potential elsewhere in oncology. ASLAN will conduct Phase II trials in Asia, then seek a partner for the drug, an HER2/EGFR inhibitor with potential to augment or supersede Roche’s Herceptin (trastuzumab) in HER-2 positive gastric cancer patients. The somewhat unusual licensing deal did not include an up-front component; rather, the two companies will “split the back end economics,” Array CEO Robert Conway said in an interview with PharmAsia News, adding that Array will still receive “a significant portion” of the proceeds if Aslan completes an out-licensing deal after Phase II trials are complete. The arrangement between the two companies also includes an option for ASLAN to negotiate a license for a second Array compound. Singapore’s BV Healthcare II, a fund managed by BioVeda Capital, led ASLAN’s Series A round, investing alongside Sagamore Ventures and other backers. – Tamra Sami and P.B.
Durect/Zogenix: Durect is the latest company to partner its extended release technology to turn an old staple into a new product. Zogenix will use Durect’s Saber technology to create a once-monthly formulation of risperidone, an antipsychotic that went off patent in 2003. The drug is expected to start clinical trials in 2012, but will face plenty of competition once it hits the market. Johnson & Johnson already makes a twice monthly injectible risperidone called Risperdal Consta that had sales of more than $1.5 billion in 2010. Zogenix will pay Durect $2.25 million upfront, as well as $103 million in future clinical, regulatory and commercial milestones. Durect will also be eligible for royalty payments should the product reach the market. The deal was a relatively small one, but will help the company move forward the rest of its pipeline, which is largely pain medications.- L.L.
Public domain image from Wikimedia Commons.