Deals of the Week: AstraZeneca’s Neuroscience Deals, Verastem/Pfizer, Alnylam/Ascletis

AstraZeneca’s neuroscience innovative medicines unit (iMED) begins to take shape through a pair of deals with Link Medicine Corp. and with four academic labs.

[Each week, “The Pink Sheet” presents commentary on some of the week’s most interesting business deals, contributed by the editors of the IN VIVO blog.]

While many big pharmas have shied away from central nervous system drugs lately, at least one is striking early-stage scientific agreements in neuroscience. AstraZeneca PLC's new neuroscience innovative medicines unit (iMED) is still a virtual company division, but it is showing some real concrete progress in its deal-making, signing a pair of deals that redouble its commitment to neurodegenerative diseases.

On July 12, AstraZeneca announced its second and third agreements since the division was set up earlier this year, acquiring a portfolio of small-molecule assets from the U.S. company Link Medicine Corp. and, separately, entering into a research alliance, dubbed the A5 alliance, with four academic laboratories to evaluate the role of apolipoprotein E4 (ApoE) in Alzheimer's disease.

In the Link Medicine deal, AstraZeneca's neuroscience iMED acquired a number of molecules in the clinical and preclinical stage that target the enzyme farnesyltransferase and modulate autophagy – the process whereby cells degrade and recycle their own misfolded or damaged proteins. Neurodegenerative diseases such as Parkinson's and Alzheimer's diseases are characterized by a build-up of such incorrectly folded, aggregated or neurotoxic proteins.

Link Medicine, set up in 2005 by two philanthropists and Harvard Medical School neuroscience researcher Peter Lansbury, will receive unspecified upfront and milestone payments, while AstraZeneca will assume all R&D activities with the programs. Link Medicine has courted little publicity since it was established, although it did raise $40 million during a 2008 series C funding round from a couple of VCs, Clarus Ventures and SV Life Sciences [See Deal].

With the A5 alliance, AstraZeneca will join with Dr. Steven Paul of Weill Cornell Medical College, Dr. David Holtzman of Washington University, St. Louis, Dr. Peter Davies of the Feinstein Institute for Medical Research, and Dr. Cheryl Wellington of the University of British Columbia, to try to identify, validate and risk-reduce ApoE-related drug targets in Alzheimer's. Although ApoE is well known to be a risk factor in Alzheimer's, second only in importance to age, no drugs have been developed that target ApoE-related mechanisms. AstraZeneca will fund the research.

Since being set up in February 2012, AstraZeneca's neuroscience iMED, through the pharma’s biologics arm MedImmune LLC, also has forged an agreement with the U.S. company Axerion Therapeutics Inc. involving preclinical antibodies for Alzheimer's disease (Also see "AstraZeneca Goes Virtual In Neuroscience R&D As Part Of Workforce Reduction" - Pink Sheet, 2 Feb, 2012.) and (Also see "Deals Of The Week: Sandoz/Fougera, Abbott/Action Pharma/Zealand, AstraZeneca/Axerion" - Pink Sheet, 7 May, 2012.).

Verastem/Pfizer and Verastem/Eisai

Verastem Inc. had a busy week, striking two separate deals that will help build its stem cell-focused pipeline. On July 11, Verastem in-licensed Pfizer Inc.’s focal adhesion kinase (FAK) inhibitor formerly known as PF-04554878, which the big pharma decided to stop developing after a strategic review of its portfolio.

Pfizer is not currently developing any FAK inhibitors, but GlaxoSmithKline Inc. and Boehringer Ingelheim GMBH both are developing compounds against this target – each program is in Phase I. VS-6063, as the FAK inhibitor compound now will be known, has completed a Phase I safety study in 36 patients with advanced solid tumors that was presented at the American Society of Clinical Oncology meeting last year. The study revealed that the compound was well-tolerated and showed signs of clinical activity.

Verastem will receive all intellectual property surrounding ’6063, including a composition-of-matter patent that will last until 2029, and, in exchange, Pfizer reportedly will receive an upfront payment of $1.5 million in cash, about $2 million in stock and the potential to earn $125 million in milestones. Verastem will be solely responsible for the development of the compound.

Also on July 11, Verastem announced that it inked a deal with Eisai Inc. to collaborate on its Wnt inhibitor program, based on its compound VS-507. The 12-month collaboration will focus on analogs of VS-507, with Verastem getting full ownership of any compounds that result. Verastem will use its Wnt signaling and cancer stem cell assays to test the resulting analog compounds for selectivity.

Eisai will be eligible for royalities and hold the right of first negotiation on any compounds that result. After concluding the agreement with Eisai, Verastem said it will deprioritize the development of ‘507 as it pushes the FAK inhibitor program into the clinic.

Alnylam/Ascletis

Looking for a partner for its Phase II-ready RNAi candidate for hepatocellular carcinoma (HCC) for more than a year now, Alnylam Pharmaceuticals Inc. found one – at least for China and three other small Asian markets – in a licensing deal with U.S./China hybrid Ascletis Inc. Announced July 12, the deal provides Ascletis, headquartered in both Hangzhou, China, and Research Triangle Park, N.C., with rights to develop and commercialize ALN-VSP in China, Hong Kong, Macau and Taiwan.

Although Alnylam is eligible for milestones and sales royalties, it receives no upfront payment in the deal. Alnylam Chief Business Officer Laurence Reid told PharmAsia News that gaining the rights to use Ascletis’ trial data for registrational efforts in other countries matters more to his company than an upfront payment. “From our perspective, the largest HCC population is in the Asian region, particularly China, where it’s driven by the dreadful prevalence of hepatitis virus infections, so having them finance the advance of the drug in that population and us getting rights to the data, that’s the basic value-swap of the deal,” Reid said.

About 55% of new diagnoses of HCC each year occur in China. Ascletis CEO Jinzi Wu said his firm would negotiate a Phase II protocol with China’s State FDA, with a plan to test ALN-VSP in about 100 patients with a primary endpoint of progression-free survival.

Janssen/Evotec/Harvard

Regenerating ailing pancreatic islet beta-cells inside a patient's body is the aim of a new three-way collaboration announced July 11 between the Johnson & Johnson unit Janssen Pharmaceuticals Inc., the German drug discovery services company Evotec AG, and Harvard University.

The deal comes only a year after Evotec forged links with the Harvard laboratories of professor Doug Melton, to help advance research on small-molecule and biological substances that appear to regenerate beta-cells, and move closer to a potentially curative approach to diabetes; the project's name, CureBeta, highlights the ambitious nature of the enterprise. Janssen paid a relatively modest $8 million upfront to take potential products arising from the research through clinical trials and on to the market, with Evotec and Harvard sharing in milestones worth $200 million-$300 million per product, and royalties on sales. The size of the split was not revealed.

The research should add to Janssen's efforts in diabetes, which notably include a new type of antidiabetic, canagliflozin, recently submitted for marketing approval in the U.S. and Europe. The German company's role in providing a bridge between academia and big pharma is a new one – making academic research more attractive to the industry through "industrial-standard" experimentation in industrial-grade infrastructure, rather than its usual role of providing discovery development services for biotech and pharma companies.

Perhaps buoyed by CureBeta's success, Evotec has set up similar projects in other areas, including CureNephron, another collaboration with Harvard set up in February 2012, CureNeuron and CureHeart (Also see "Deals Of The Week: Eisai/Epizyme, AstraZeneca/Galderma, Evotec/Harvard" - Pink Sheet, 14 Mar, 2011.).

Janssen/Genmab

Separately, Janssen's U.S.-based immunology, oncology and nephrology unit Janssen Biotech Inc. will collaborate with Danish biotech Genmab AS to identify and develop bi-specific antibodies for multiple disease targets, under the terms of a deal announced July 12. Janssen agreed to pay DKK 21 million ($3.5 million) upfront in the deal, which also includes potential milestone and licensing payments valued at DKK 1.06 billion ($175 million).

Janssen will fund research on panels of antibodies supplied by Genmab for disease targets Janssen has identified. Although the companies didn’t specify the disease areas on which they will focus, Genmab typically uses its DuoBody platform to discover and develop drugs for cancer, autoimmune and infectious diseases, and central nervous system disorders. Publicly traded in Sweden, Genmab previously introduced the antibody Arzerra (ofatumumab), approved by FDA for chronic lymphocytic leukemia in 2009.