NASH-Driven Deals Pile Up

On November 10, 2016, Bristol-Meyers Squibb (NYSE: BMY) purchased the exclusive worldwide rights to develop and commercialize Nitto Denko Corporation’s (TYO: 6988) investigational siRNA, which includes Nitto’s lead asset ND-L02-s0201. Nitto’s lead asset ND-L02-s0201 is currently in a five-week open-label Phase 1b study in patients with advanced fibrosis (F3-F4c) due to non-alcoholic steatohepatitis (NASH) or hepatitis C. Nitto Denko received a $100 million upfront payment as part of the license agreement, and it is not the first company to cash in on its product candidates for the possible treatment of NASH.

NASH is characterized by fatty infiltration of the liver not caused by alcohol, and may progress to liver fibrosis, cirrhosis, hepatocellular carcinoma and liver failure. By 2030, the condition is expected to be the leading cause of liver transplants. Today, approximately 20 million patients in the United States have been diagnosed with NASH, and no approved pharmacologic therapies exist.

The quest for NASH drug development heated up in early 2015, when Gilead Sciences (NASDAQ: GILD) purchased the Farnesoid X Receptor (FRX) program, comprising small molecule FXR agonists for the treatment of NASH, from Phenex Pharmaceuticals for an undisclosed price.

Since then, $1.4 billion has been spent in upfront payments to either purchase licenses to these drug candidates or purchase companies containing NASH drug candidates in their pipelines. When we factor in disclosed milestone payments, we get an additional $2.3 billion.

One of the biggest players in NASH development is Tobira Therapeutics Inc. (NASDAQ: TBRA). In January 2015, while it was still a private company, it merged with Regado Biosciences, Inc. (NASDAQ: RGDO) and received a $22 million investment from a Tobira investor syndicate, shortly after its lead product immunomodulator and anti-fibrotic agent cenicriviroc (CVC) received Fast Track Designation from the FDA for the treatment of NASH.

In April 2016, Tobira entered into two separate license deals with Dong-A ST Co., Ltd (170900: Korea SE) to market and develop evogliptin in combination with cenicriviroc and as a single agent in the United States, Canada, Europe, Australia and the Republic of Korea. Part of the agreement was to collaborate on Phase 3 trials.

Then, in September 2016, pharma giant Allergan plc (NYSE: AGN) got into the game with its acquisition of Tobira for an upfront payment of $533.5 million ($28.35 per share), and a total consideration of up to $1.7 billion once milestones were considered. The acquisition added cenicriviroc and evogliptin to Allergan’s gastroenterology R&D pipeline.




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