Going Deeper Into Rare Disease, GSK Takes Reins of Amicus Fabry Program

Even with Phase III trial delays, Glaxo pays $60 million upfront for worldwide rights to Amigal and takes a minority stake in its developer.

GlaxoSmithKline PLC continued its aggressive deal-driven entry into the rare-disease market, announcing Friday, Oct. 29 it has licensed worldwide rights to the Fabry disease treatment Amigal (migalastat HCl) from Amicus Therapeutics Inc. The deal calls for an upfront payment of $60 million, half of which pays for a 19.9% equity stake in Amicus, and $170 million more in potential milestones and tiered double-digit royalties.

With patients enrolling in a Phase III trial through the beginning of 2011, Amicus could start receiving some of the milestone payments next year, said CEO John Crowley on a conference call Friday. GSK will also pay for an undisclosed amount of the clinical development, and the cash coming in from the deal will be enough to sustain Amicus at least until US approval of Amigal, Crowley said.

In addition, GSK has agreed to a standstill that prevents it from buying more Amicus stock for an unspecific time period. More details regarding the alliance will be forthcoming on the firm's upcoming quarterly earnings call, Crowley said.

For its equity stake, GSK paid $4.56 a share, a 15% premium over Amicus's closing price Thursday in what CEO Crowley called "a competitive process." Shares closed Friday at $4.11, up 4%.

Outside of biotech circles, Amicus and Crowley are best known because of the Hollywood film "Extraordinary Measures," in which Brendan Fraser plays Crowley, whose children have Pompe disease, and Harrison Ford plays the irascible scientist Crowley teams with to find a treatment. Amicus's Pompe treatment AT2220 was in Phase II when it was put on clinical hold in early 2009. Later that year, Amicus ended its co-development relationship with Shire PLC, taking back rights to AT2220, Amigal, and the Gaucher disease treatment Plicera (Afegostat tartrate).

For GSK, Amicus represents its latest deal to populate the portfolio of its new rare-disease business unit, which it unveiled in February (Also see "GSK Argues Its Strategy Is Delivering As Still More Cuts Are Made, Including in R&D" - Pink Sheet, 4 Feb, 2010.). With a 60-patient Phase III trial now enrolling, Amigal is its nearest-term commercial prospect yet. GSK's other rare-disease deals include (Also see "GSK Bolsters Orphan Drug Discovery By Signing Antisense Deal With Isis" - Pink Sheet, 31 Mar, 2010.) with Isis Pharmaceuticals Inc. to use that firm's antisense drug discovery platform to develop new drugs against five targets in different therapeutic areas, including infectious disease and ophthalmology. In 2009, the drug maker signed agreement with Prosensa to develop four RNA-based compounds for the treatment of Duchenne muscular dystrophy; and purchased a nearly 17% stake in Japan's JCR Pharmaceuticals, which makes recombinant biologicals for orphan diseases.

The orphan and rare disease field is enjoying a renaissance of attention as industry economics force Big Pharma firms to look beyond blockbuster primary-care indications (Also see "Orphaned No Longer: Big Pharma Embraces Drugs for Niche Markets" - In Vivo, 1 Feb, 2010.). Genzyme Corp.'s well-documented manufacturing flubs have further emboldened competitors such as Sanofi-Aventis SA, which is trying to wear down Genzyme management and shareholders with a stubbornly played hostile bid (Also see "Sanofi Holds Its Ground On Genzyme Bid" - Pink Sheet, 28 Oct, 2010.).

All eyes on two registrational trials

While the deal is a financial blip for Glaxo, Amicus CEO Crowley called it "transformational" for his company, giving it a deep-pocketed global partner to help take Amigal to market for a small but widely dispersed patient population. Crowley said other bidders were involved. GSK's reach could be critical in Phase III trials, too. In addition to the US trial currently enrolling and already delayed from original plans -- the target is 60 patients in 40 sites worldwide -- Amicus plans to start a registrational trial in Europe next year.

Analysts will be watching enrollment closely. "Accrual in the pivotal Amigal Phase III trials may be challenging, according to physicians," wrote Leerink Swann biotech analyst Joseph Schwartz in a note to clients Friday. "Some clinicians have suggested that accrual in the Phase III trial may not even be possible at their center since they are still awaiting [review board] approval and they may not be able to find patients that meet the narrow entry criteria and agree to the rigorous diagnostic tests such as kidney biopsy."

In Fabry disease, patients have an inherited mutation that results in the inability to break down the fat molecule globotriaosylceramide (GL-3), which accumulates in tissues and leads eventually to death. Amigal is an oral small molecule compound that aims to bind and stabilize the enzyme alpha-galactosidase A (alpha-Gal A). The drug then "chaperones" the enzyme to the lysosomes, where it does its normal job of metabolizing GL-3.

If effective, Amigal's mode of delivery would make it a far more convenient treatment than either Genzyme's Fabrazyme (agalsidase beta) and Shire's Replagal (agalsidase alfa). Both are enzyme replacement therapies administered by infusion every two weeks. Genzyme's manufacturing snafus at its plant in suburban Boston damaged the reputation of the company and its executives, and the resulting drug shortages have endangered patients, some of whom have asked the US government to waive Genzyme's patent protection under the Bayh-Dole Act's so-called "march-in rights."

- Alex Lash ([email protected])