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GSK, Actelion Ink Deal Worth Up to US$3.25 bil. for Insomnia Drug Almorexant
14 Jul 08
GlaxoSmithKline (GSK) has snapped up Actelion's candidate insomnia treatment almorexant in a co-development and co-marketing deal that could be worth up to 3.3 billion Swiss francs (US$3.25 bil.).
Global Insight Perspective | | Significance | Actelion and GSK will collaborate on the clinical development, regulatory filing and marketing of orexin receptor antagonist almorexant in three separate indications. If all goes according to plan, the deal could be worth up to 3.3 billion Swiss francs to the Swiss biotech. | Implications | For now GSK has committed to a 150 million francs payment, with all the other pay-outs relying on successful milestone completion. Nevertheless, Actelion has secured GSK's financial and commercial support for the drug, maximising its revenue potential. | Outlook | The insomnia market is in need of its next breakthrough and almorexant, with its first-in-class mode of action, has a shot at being the next market leader in the segment. The deal is all the more important for Actelion as it could set the company free from its heavy financial reliance on its current revenue driver, which accounts for close to 90% of the biotech's revenues. |
U.K. pharmaceutical company GlaxoSmithKline (GSK) and Swiss biotech Actelion have signed an exclusive worldwide agreement, excluding Japan, regarding Actelion's insomnia drug almorexant. Under the terms of the agreement, the two companies will co-develop and potentially co-commercialise the drug in three therapeutic indications, including primary insomnia. Actelion remains responsible for developing and seeking regulatory approval in the drug's primary insomnia indication, although GSK will cover 40% of the associated costs. In the other two unnamed indications, the two companies will equally shoulder the development and regulatory costs. Actelion will initially receive an upfront payment of 150 million Swiss francs (US$147.7 million) and milestone payments worth up to 415 million Swiss francs. If all targets are met in the other two development programmes, Actelion would be eligible to additional potential payments worth up to 2,735 million Swiss francs. Profits on the drugs will be shared equally between the two partners. Almorexant is an oral, first-in-class orexin inhibitor currently undergoing phase III clinical development for the treatment of primary insomnia (see Switzerland: 21 December 2007: Actelion Announces Phase III Trials for Insomnia Drug Almorexant). Orexins are produced by the hypothalamus and contribute to the regulation of sleep-wake cycles. Orexins were discovered in 1998 and are also known as hypocretins. The insomnia market was valued at US$3.9 billion in 2006 and could fetch over US$5.2 billion at the turn of the decade. The market is currently dominated by French company Sanofi-Aventis' Ambien (zolpidem tartrate) and Ambien CR (zolpidem tartrate extended-release tablets). Insomnia drugs have traditionally activated the brain's GABA-A receptors, leading to a generalised suppressive effect on the body's central nervous system. As a result, these compounds are Drug Enforcement Administration (DEA)-scheduled controlled substances, due to their potential for abuse, subjecting them to prescription restrictions that severely curtail their market potential. Drug-makers are moving away from these types of products and the latest entrant to the market is Danish company Lundbeck's Circadin (melatonin extended-release). In addition to almorexant, leading pipeline candidates are Sanofi-Aventis's 5HT2A antagonists eplivanserin and volinanserin, Vanda Pharmaceutical’s melatonin agonist VEC-162 and Schering Plough’s serotonin 2 blocker Org-50081. Outlook and Implications GSK has snapped up a coveted compound as a number of pharma heavyweights had approached the Swiss biotech regarding the drug. Almorexant will beef up GSK's pipeline of insomnia drugs, which at the moment consists of Lunivia (eszopiclone, rights in-licensed from U.S. Sepracor, marketed as Lunesta in the United States). The insomnia market is still waiting its next revolution as market leader Ambien fell off-patent in the United States in 2007, and Lunesta and Rozerem (ramelteon, Takeda Pharmaceutical, Japan) have yet to make a significant sales impact on the segment. Rozerem is potentially out of the race as it failed to demonstrate significant efficacy compared to older treatments. If almorexant successfully completes clinical development and secures regulatory approval, it could be the next blockbuster in the segment. Almorexant's patent runs until 2025, which will provide the two companies with over a decade of market exclusivity if the drug reaches the market. The insomnia field has recently experienced a couple of setbacks: Lundbeck and Merck & Co (U.S.) discontinued investigative compound gaboxadol following disappointing results in Phase III studies and indiplon's (Neurocrine, U.S.) U.S. regulatory process has been stalled since May 2006. From Actelion's perspective, the deal ensures that almorexant will benefit from GSK's commercial and financial muscle. In the primary insomnia setting, it will expand the drug's commercial horizon and maximise profits. In the other two, unnamed indications, the deal will ensure that almorexant benefits from GSK's clinical expertise and then from GSK's funds to push it through later phases of development. Although the two additional therapeutic areas were not named, scientific studies have linked orexins to attention and cognition disorders, notably those associated with Parkinson's disease and schizophrenia. The Swiss biotech will welcome a steady stream of revenues as it needs to break free from its financial reliance on pulmonary arterial hypertension (PAH) drug Tracleer (bosentan), which currently accounts for 89.4% of the company's revenues. Tracleer is facing increasing competition and the deal will give Actelion room to breathe and financial leeway to invest in its existing pipeline, which is heavy in mid-phase compounds.
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