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January 4, 2010
Volume 88, Number 1
p. 9

Big Pharma's Year-End Spree

Acquisitions: Flurry of deals bolsters drug companies’ late-stage pipelines

Lisa M. Jarvis

As part of a new deal, Incyte’s labs, such as the one shown here, will allow Lilly access to a rheumatoid arthritis drug candidate. Incyte
As part of a new deal, Incyte’s labs, such as the one shown here, will allow Lilly access to a rheumatoid arthritis drug candidate.
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As 2009 drew to a close, pharmaceutical companies opened their pocketbooks for several drug candidates. The highest price tags were on late-stage compounds intended to help offset revenue losses when generic drug competition hits key products.

In the biggest end-of-season deal, AstraZeneca is paying up to $505 million for Novexel, a private French anti-infectives company. When the deal is complete, Forest Laboratories will pay AstraZeneca half of the acquisition costs in exchange for the rights to co­develop two of Novexel’s antibiotic therapies.

One combines ceftazidime and NXL-104, Novexel’s β-lactamase inhibitor for gram-negative infections. The other combines NXL-104 with ceftaroline. The ceftazidime/NXL-104 combination is likely to move into Phase III trials by late this year.

Both Forest and AstraZeneca are in dire need of new drugs. Forest loses exclusivity on the antidepressant Lexapro in 2012 and on the Alzheimer’s drug Namenda a year later. AstraZeneca’s antipsychosis drug, Seroquel, is slated to lose patent protection in 2011.

Novexel’s products could be lucrative: The treatment options for gram-negative infections are dwindling, and few drugs in the pipeline address the problem (C&EN, April 14, 2008, page 15).

In a separate deal, Novartis is buying San Francisco-based Corthera for $120 million. Novartis is after relaxin, a heart failure drug in Phase III trials that, if successful, could bring Corthera shareholders an additional $500 million in milestone payments.

Relaxin is a naturally occurring polypeptide hormone that “relaxes” women’s reproductive tracts and mediates cardiovascular and kidney changes during pregnancy. When administered during heart failure, the peptide widens blood vessels. Novartis expects to submit relaxin for regulatory approval in 2013, the same year it loses patent protection on the multi-billion-dollar oncology drug Gleevec.

Meanwhile, Eli Lilly & Co. has agreed to pay Incyte Pharmaceuticals $90 million up front for access to INCB28050, which is in Phase II trials as a rheumatoid arthritis treatment. INCB28050 blocks JAK1 and JAK2, critical enzymes in the immune system’s complex signaling network. Lilly already has JAK inhibitor candidates through its 2008 acquisition of SGX Pharmaceutical.

Lilly faces its own revenue drain in 2011, when the patent expires on Zyprexa, its blockbuster schizophrenia drug. “Given the patent expiries Lilly faces over the coming years, we see them as a highly motivated and suitable partner” for Incyte, says Joshua Schimmer, a stock analyst at Leerink Swann.

In another deal, Teva Pharmaceutical Industries, a generic drug firm that is trying to get into branded pharmaceuticals, licensed a late-stage cancer therapy from OncoGenex. Teva handed over $60 million, including $10 million for a stake in the biotech firm, to share the rights to OGX-011, a second-generation antisense drug that blocks the cell-survival protein clusterin. The drug is currently in Phase III trials to prevent cancer from developing resistance to chemotherapy.

Chemical & Engineering News
ISSN 0009-2347
Copyright © 2011 American Chemical Society
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