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Biogen gains Fibrosis Drug in $562M Stromedix Deal
By Catherine Shaffer
Staff Writer
A promising candidate for idiopathic pulmonary fibrosis forms the basis of an acquisition deal between Biogen Idec Inc. and Stromedix Inc., of Cambridge, Mass. Biogen will pay $75 million up front, and up to $487.5 million in milestones for the company, gaining Stromedix's humanized monoclonal antibody, STX-100.
There is no approved treatment for idiopathic pulmonary fibrosis, and it has a very high mortality rate. Biogen is banking on STX-100 as a game changer in that indication.
The acquisition of Stromedix by Biogen seems especially fitting, as STX-100 started its existence as a program within the Weston, Mass.-based big biotech. The program was shelved for strategic reasons and eventually out-licensed to Stromedix.
"We went out looking for programs that we could license in," Stromedix CEO Michael Gilman told BioWorld Today. "We made a shopping list of targets and pathways important in fibrosis." That included programs in development at companies and at academic institutions.
Gilman said he had been aware of Biogen's fibrosis candidate, but it wasn't available until 2006, when Biogen conducted a regular portfolio review.
In 2008, Stromedix began a Phase I trial of STX-100 and completed a $25 million Series B financing round, led by New Leaf Venture Partners, with participation from Bessemer Venture Partners and Red Abbey Venture Partners. (See BioWorld Today, April 22, 2008.)
Gilman said it was "never the plan" to take STX-100 back into Biogen. "At the time we licensed the program from Biogen," he said, "things were as dead as they could be."
Biogen had no contractual rights to get STX-100 back, although it did own equity in Stromedix and occupied a seat on the board. Subsequent to a change in leadership at Biogen – new CEO George Scangos came on board in mid-2010 – the company's pipeline and portfolio underwent an overhaul, and in the process, it regained an interest in fibrosis in connection with its immunology efforts.
Although Biogen reviewed many products and programs, in the same way that Gilman did in founding Stromedix, it had intimate familiarity with and confidence in STX-100.
"We were not out shopping the asset or the company," Gilman said. "We were focused on getting the trial done. When they approached us with interest, we evaluated all of our options, and that seemed like a good one."
Gilman said STX-100 was a rare example of a program out-licensed from a large company and then brought back in.
Stromedix described fibrosis as "wound repair gone bad." It results from chronic tissue injury, leading to accumulation of scar tissue in the organ and eventual organ failure. STX-100 targets integrin alpha(v)beta6.
The compound has shown significant antifibrotic activity in preclinical lung, kidney and liver models. In 2010, the FDA granted orphan drug status to STX-100 in IPF.
Stromedix completed a Phase I trial in 40 healthy volunteers and is "gearing up" for a Phase II placebo-controlled, dose-escalation study in 32 IPF patients. That trial will have endpoints including safety and lung function following eight weeks of subcutaneous dosing.
Brian Abrahams, an analyst for Wells Fargo, said in a research note that the acquisition "makes sense, particularly given BIIB's familiarity with the program, and helps the company's goal of broadening its early/mid-stage pipeline; however, we do not view it as a significant near-term driver for BIIB shares."
The stock (NASDAQ:BIIB) closed Tuesday at $119.70, a drop of 30 cents.
Abrahams also noted that STX-100 could have utility in other fibrotic diseases because it is thought to have antifibrotic effects via selective binding to integrin alpha(v)beta6, which prevents activation of TGF. TGF may play a role in a number of fibrotic diseases, as well as diabetes and cancer.
Because there are no approved therapies in the U.S. for pulmonary fibrosis, and because it affects an estimated 128,000 Americans, with 28,000 new cases per year, the market opportunity is estimated at $500 million to $1.5 billion.
The most effective standard treatment for pulmonary fibrosis is lung transplant. However, many patients are older and not eligible for lung transplants due to co-morbidities such as diabetes and cancer.
Intermune Inc., of Brisbane, Calif., markets Esbriet (pirfenidone) in Europe for mild to moderate IPF. It is unrolling the product in 2012 in France, Spain, Italy and the UK. However, the FDA issued a complete response letter for the drug in 2010, requesting an additional pivotal study.
The new drug application (NDA) for Esbriet had been based on pooled data from two Phase III trials, one of which hit its endpoint, while the other failed. Intermune is now running a new 52-week trial (ASCEND), with the goal of resubmitting in the second half of 2013. (See BioWorld Today, May 5, 2010.)
Competitors Tracleer (bosentan), from Actelion Ltd., and Letairis (ambrisentan), from Gilead Sciences Inc., have dropped out of the race following Phase III misses, leaving early stage products as the primary competition for STX-100.
Promedior Inc.'s PRM-151, a recombinant human pantaxin-2 protein, completed Phase I, and Gilead is making new entry in the field with an early stage IPF program acquired in its $225 million buyout of Arrest Biosciences Inc. last year. (See BioWorld Today, Dec. 21 , 2010, and Dec. 27, 2010.)
Bristol-Myers Squibb Co. threw its hat into the ring when it acquired San Diego-based Amira Pharmaceuticals Inc., picking up Phase I IPF product, AM152, a lysophosphatidic acid 1 receptor antagonist. Other early stage entries include CNTO-888, an antibody from Johnson & Johnson and IW001, an oral solution of Type V collagen from ImmuneWorks Inc. (See BioWorld Today, July 25, 2011.)