Dealmaking Quarterly Statistics, Q3 2022
A Look At M&A And Alliance Activity Across The Biopharma, Medical Device And In Vitro Diagnostics Industries, July-September 2022
Executive Summary
During Q3, biopharma merger and acquisition value reached $15.4bn and drew in $37.6bn in potential deal value from alliances. Device company M&A values reached $550m, while in vitro diagnostic firms and research tools players completed M&A activity that totaled $1.9bn.
Biopharma Acquisitions
Biopharma merger and acquisition value for the third quarter of 2022 reached $15.4bn from 41 transactions, 21 of which had disclosed values. Four M&A transactions hit or exceeded the billion-dollar mark during Q3 (see Exhibit 1).
|
Date |
Acquirer/Acquired (Business) |
Terms |
|
Aug. 8 |
Pfizer/Global Blood Therapeutics (rare hematology disorders) |
$5.2bn: $68.50 in cash per share, an 82% premium; 27.73x sales |
|
Aug. 4 |
Amgen/ChemoCentryx (orally administered therapeutics to treat autoimmune diseases, inflammatory disorders, and cancer) |
$3.7bn: $52 in cash per share, a 124% premium; 115.15x sales |
|
Jul. 5 |
AstraZeneca/TeneoTwo (therapeutic antibodies targeting B-cell malignancies) |
$1.3bn: $100m in cash at closing, $805m in R&D-related earn-outs, and $360m in commercial-related earn-outs |
|
Sep. 1 |
Novo Nordisk/Forma Therapeutics (sickle cell disease and rare blood disorders) |
$1.1bn: $20 in cash per share, a 62% premium |
|
Aug. 22 |
Alcon/Aerie Pharmaceuticals (ophthalmic therapeutics)* |
$770m: $15.25 in cash per share, a 35% premium; 3.97x sales |
At the top, and making up about a third of the Q3 total was Pfizer Inc.’s $5.2bn acquisition of Global Blood Therapeutics, Inc. (GBT), for a total enterprise value of approximately $5.4bn, including debt and net of cash acquired. GBT is dedicated to the discovery, development, and delivery of treatments to underserved patient communities, starting with sickle cell disease (SCD). The acquisition provides Pfizer with an SCD franchise with potential for combined worldwide peak sales of more than $3bn. Through the deal, Pfizer gains Oxbryta (voxelotor), a treatment for SCD that received FDA approval in 2019.
Oxbryta has also been approved in other countries, including the EU, UAE, Oman, and Great Britain, and is distributed in several Middle Eastern countries by Biopharma-MEA. In addition, Pfizer will gain multiple pipeline assets including GBT021601, a next-generation sickle hemoglobin (HbS) polymerization inhibitor in Phase II, and inclacumab, a monoclonal antibody targeting P-selectin in Phase III trials to treat and reduce the frequency of vaso-occlusive crisis (VOC). In March 2021, GBT also in-licensed from Sanofi exclusive worldwide rights to two early-stage, small-molecule SCD programs.
The acquisition is one of several by Pfizer in the last year as the Big Pharma seeks to expand its late-stage pipeline and portfolio. It most recently bought Biohaven Pharmaceutical Holding Company Ltd. (migraine drugs) for $11.6bn in May. In April, it bought ReViral Ltd. (RSV therapeutics) for $525m, and in late 2021, Pfizer acquired Arena Pharmaceuticals, Inc.(lead candidate in ulcerative colitis) for $6.7bn. (Also see "Pfizer’s Buying Spree Continues With GBT, Gaining A Sickle Cell Disease Franchise" - Scrip, 08 August, 2022.)
In the second-largest biopharma M&A transaction of Q3, Amgen, Inc. paid $3.7bn to acquire ChemoCentryx, Inc. (focused on orally administered therapeutics to treat autoimmune diseases, inflammatory disorders and cancer), gaining the biotech’s Tavneos (avacopan), a first-in-class medicine for patients with serious autoimmune disease. Tavneos is an orally administered selective complement component 5a receptor inhibitor that was approved in October 2021 as an adjunctive treatment for adults with severe active anti-neutrophil cytoplasmic autoantibody-associated vasculitis (ANCA-associated vasculitis), specifically granulomatosis with polyangiitis and microscopic polyangiitis (the two main forms of ANCA-associated vasculitis), in combination with standard therapy. The drug is also approved in the EU and Japan.
Under a 2016 partnership, CSL Vifor holds and will retain exclusive rights to commercialize Tavneos outside the US, except in Japan, where Kissei Pharmaceutical Co., Ltd holds rights (under a 2017 sublicense from Vifor) and in Canada, where Otsuka Pharmaceutical Co. Ltd. holds commercialization rights (under a 2021 sublicense from Vifor).
ChemoCentryx’s pipeline also includes three early-stage drug candidates that target chemoattractant receptors in other inflammatory diseases and an oral checkpoint inhibitor for cancer. The addition of these assets is expected to enhance Amgen's existing portfolios in inflammation (including Otezla (apremilast), Enbrel (etanercept), Tezspire (tezepelumab), Amgevita (a Humira (adalimumab) biosimilar), Riabni (a biosimilar to Rituxan (rituximab)), and Avsola (a Remicade (infliximab) biosimilar)) and nephrology (including Epogen (epoetin alfa), Aranesp (darbepoetin alfa), Parsabiv (velcalcetide),and Sensipar (cinacalcet HCL)), as well as its development pipeline in inflammation. (Also see "AstraZeneca Expands Lymphoma Pipeline With TeneoTwo Acquisition" - Scrip, 05 July, 2022.)
In another top deal by a Big Pharma, AstraZeneca PLC acquired privately held start-up TeneoTwo, Inc. (therapeutic antibodies targeting B-cell malignancies) for $1.2bn. TeneoTwo’s lead bispecific asset will help enlarge AZ’s lymphoma pipeline.
In a third transaction involving a hematology-focused company, Novo Nordisk A/S paid $1.1bn to buy Forma Therapeutics Inc. (sickle cell disease and rare blood disorders). Forma's R&D engine combines deep biology insight, chemistry expertise, and clinical development capabilities to create drug candidates with differentiated mechanisms of action focused on indications with high unmet need. The acquisition of Forma, including its lead development candidate, etavopivat, is aligned with Novo Nordisk’s strategy to complement and accelerate its scientific presence and pipeline in hemoglobinopathies.
Etavopivat, an investigational oral, once-daily, selective pyruvate kinase-R (PKR) activator, is being developed to improve anemia and red blood cell health in people with SCD. The candidate is currently being evaluated in a global Phase II/III clinical trial (Hibiscus) in patients with SCD, and in a Phase II trial (Gladiolus) in patients with transfusion-dependent SCD and another inherited hemoglobinopathy called thalassemia. (Also see "Novo Nordisk’s Forma Buy Builds On Foothold In Rare Blood Disorders" - Scrip, 01 September, 2022.)
In the only top M&A deal not involving Big Pharma, Alcon Inc. agreed to acquire public ophthalmology-focused Aerie Pharmaceuticals, Inc. for $770m in a transaction anticipated to close in the fourth quarter of 2022. Alcon will add Aerie’s commercial products Rocklatan (netarsudil and latanoprost ophthalmic solution) 0.02%/0.005% and Rhopressa (netarsudil ophthalmic solution) 0.02%; AR-15512, a Phase III product candidate for dry eye disease; and a pipeline of several clinical and preclinical ophthalmic pharmaceutical product candidates.
Rocklatan is a fixed dose combination of the Rho kinase inhibitor, netarsudil, and a prostaglandin F2α analogue, latanoprost, indicated for the reduction of elevated intraocular pressure (IOP) in patients with open-angle glaucoma or ocular hypertension. Rhopressa is a Rho kinase inhibitor indicated for the reduction of elevated IOP in patients with open-angle glaucoma or ocular hypertension. In markets outside the US, Aerie licensed commercialization rights for both products to Santen Pharmaceutical Co., Ltd. under a 2020 agreement. Aerie’s glaucoma franchise net product revenue is $130-140m for full year 2022. The transaction is expected to be accretive to Alcon’s core diluted earnings per share in 2024.
The current transaction complements Alcon’s recent expansion into the ophthalmic eye drop space, including acquisitions of the exclusive US commercialization rights to Simbrinza (brinzolamide/brimonidine tartrate ophthalmic suspension) for glaucoma or ocular hypertension from Novartis AG in April 2021 and global rights to Eysuvis (loteprednol etabonate suspension) 0.25% for dry eye disease and Inveltys (loteprednol etabonate suspension) 1% post-ocular surgery inflammation and pain treatment from Kala Pharmaceuticals, Inc. in May 2022. (Also see "Alcon Buys Aerie, Reaffirming Commitment To Pharma Space" - Scrip, 23 August, 2022.)
Emerging Drug Developers
During the third quarter of 2022, 10 biopharma start-up acquisitions were signed, four of which had disclosed potential deal values (see Exhibit 2). The M&A with the highest price tag was the aforementioned AstraZeneca $1.27bn buy of TeneoTwo. AZ will acquire all outstanding equity of TeneoTwo in exchange for an up-front payment of $100m on deal closing plus additional contingent R&D-related milestone payments of up to $805m and up to $360m in commercial-related milestones.
Founded in 2020 by Teneobio, Inc. (and spun out in 2021 prior to Teneobio's concurrent $2.5bn acquisition by Amgen), TeneoTwo is developing TNB-486, a Phase I clinical-stage CD19/CD3 T-cell engager under evaluation in relapsed and refractory B-cell non-Hodgkin lymphoma. If successful, TNB-486 could be a strong competitor for Amgen's bispecific T-cell engager Blincyto (blinatumomab). The acquisition aims to accelerate the development of a potential new medicine for B-cell hematologic malignancies, including diffuse large B-cell lymphoma and follicular lymphoma. Building on the success of Calquence (acalabrutinib), TNB-486 further diversifies AstraZeneca’s hematology pipeline that spans multiple therapeutic modalities and mechanisms to address a broad spectrum of blood cancers. (Also see "AstraZeneca Expands Lymphoma Pipeline With TeneoTwo Acquisition" - Scrip, 5 July, 2022.)
The second-largest acquisition was Gilead Sciences, Inc. purchase of MiroBio for $450m in cash. Spun out from Oxford University in 2019, MiroBio is a privately-held UK-based biotech seeking to develop a new class of therapeutic agents of checkpoint agonist antibodies for autoimmune patients.
The acquisition will provide Gilead with MiroBio’s proprietary discovery platform, I-ReSToRE (REceptor Selection and Targeting to Reinstate immune Equilibrium), and an entire portfolio of immune inhibitory receptor agonists to treat inflammatory diseases. MiroBio’s lead investigational antibody, MB272, is a selective agonist of immune inhibitory receptor B- and T-lymphocyte attenuator and has entered Phase I clinical trials, with the first patient dosed in early August 2022. (Also see "Gilead Grabs MiroBio's Checkpoint Agonists For $405m" - Scrip, 4 August, 2022.)
Medical Device Acquisitions
The third quarter featured nine device M&A transactions, only two of which had disclosed values, together totaling $550m (see Exhibit 3).
|
Date |
Acquirer/Acquired (Business) |
Terms |
|
Aug. 22 |
Teleflex/Standard Bariatrics (devices for surgical treatment of obesity) |
$300m: $170m in cash at closing, commercial milestone-based earn-outs up to $130m; 11.33x sales |
|
Aug. 1 |
CONMED/Biorez (bioresorbable scaffold implants) |
$250m, $85m in cash at closing, growth-based earn-outs up to $165m over a four-year period |
In the larger of the two, Teleflex Incorporated acquired Standard Bariatrics, Inc. in a transaction worth up to $300m. Standard Bariatrics, which was founded in 2014, launched its Titan SGS (a power stapling technology for bariatric surgery) in the US in Q3 2021 following FDA 510(k) clearance in April 2021. The Titan SGS addresses unmet needs in sleeve gastrectomy (a surgical weight-loss procedure) by offering surgeons a continuous staple cutline of 23 centimeters, helping users achieve consistent and symmetrical sleeve pouch anatomy. The stapler’s long staple line enables surgeons to plan and place staples in one firing, minimizing variations sometimes associated with the use of multiple overlapping short-cartridge staple firings. Standard Bariatrics’ revenues for 2022 are expected to be approximately $15m. The deal complements Teleflex’s surgical portfolio with a differentiated product serving the sleeve gastrectomy market.
In the only other Q3 device M&A with a disclosed value, CONMED Corp. paid $250m for privately-held Biorez, Inc.. Founded in 2008, Biorez is focused on soft tissue healing using its proprietary BioBrace implant technology, which is a bioinductive scaffold intended to reinforce soft tissues repaired by suture anchors. BioBrace was 510(k) cleared by the FDA in 2021 and is available in different sizes for use in multiple procedures, including tendon repair and reinforcement of rotator cuff, patellar, Achilles, bicep, or quadricep tendons.
In Vitro Diagnostics Acquisitions
Activity by diagnostics and research tools players during Q3 included four M&As, together totaling $1.9bn (see Exhibit 4).
|
Date |
Acquirer/Acquired (Business) |
Terms |
|
Jul. 7 |
SD Biosensor/Meridian Bioscience (diagnostic testing and life science raw materials)* |
$1.53bn: $34 in cash per share, a 35% premium; 4.81x sales |
|
Aug. 3 |
Bio-Rad/Curiosity Diagnostics (diagnosticPCR systems) |
$170m: $100m in cash at closing, milestone-based earn-outs up to $70m |
|
Aug. 17 |
EuroBio Scientific/Genome Diagnostics (human leucocyte antigen (HLA) diagnostics to assess compatibility between transplant donors and recipients) |
$132.3m in cash at closing; 7.66x sales |
|
Jul. 26 |
SomaLogic/Palamedrix (DNA nanotechnologies)* |
$52.5m:$35m at closing ($14m in cash and $21m in SomaLogic common shares), future revenue-based earn-outs up to $17.5m |
In the largest deal, and the only transaction to hit the billion dollar mark, South Korean in vitro diagnostics firm SD BioSensor, Inc. agreed to acquire Meridian Bioscience, Inc. for $1.53bn, which made up 81% of the Q3 diagnostics M&A total. The deal is expected to close in Q4 2022. Upon completion, SDB will own approximately 60% of Meridian and SJL, a newly formed affiliate vehicle of a consortium with private equity firm SJL Partners, will own approximately 40%.
Founded in 1976, Meridian is a fully integrated life science company that manufactures, markets, and distributes a broad range of diagnostic test kits, purified reagents, and biopharmaceutical enabling technologies. The company has gained expertise through numerous acquisitions over the years. It bought point-of-care (POC) testing company Magellan Biosciences, Inc. (blood testing to diagnose lead poisoning) in 2016. More recently, Meridian acquired Debiopharm S.A.’s GenePOC subsidiary (POC molecular diagnostics for infectious diseases) in 2019, followed by the acquisition of gastrointestinal diagnostics maker Exalenz Bioscience Ltd. in 2020, and the purchase of the BreathTek (a urea breath test for the detection of H. pylori) business from Otsuka Holdings Co., Ltd. last year. Meridian benefits from SDB's R&D capabilities and mass production experience, while the deal also marks SDB's entry into the US diagnostics market. (Also see "Meridian Bioscience Acquired By SD Biosensor In $1.53Bn Cash Deal" – Medtech Insight, 07 July, 2022.)
Life science research firm Bio-Rad Laboratories, Inc. bought private Polish-based Curiosity Diagnostics, Sp. Z. o. o. from parent Scope Fluidics S.A. for up to $170m. Founded in 2012, Curiosity Diagnostics, a late-stage, pre-commercial platform company, is in the process of developing a sample-to-answer, diagnostics PCR system for the molecular diagnostics market. Curiosity’s PCR platform, PCR|ONE, integrates into the laboratory environment, offering hands-on time, rapid response to urgent testing needs, and efficient use of bench space. Rapid molecular diagnostics offered by the PCR|ONE system will help general practitioners and their patients with diagnosis during a consultation. PCR|ONE is expected to extend Bio-Rad's reach beyond high-complexity labs into near-patient molecular diagnostics labs.
In another purchase of a private European firm, Eurobio Scientific acquired Dutch company Genome Diagnostics BV for €135m ($132m), financed partially through a €90m ($91.4m) bank loan. The deal will allow Eurobio to complete its commercial portfolio with GenDx's complementary proprietary products in the field of human leucocyte antigen (HLA) diagnostics.
Founded in 2005, GenDx specializes in the molecular diagnostics of transplants by HLA typing organs or patients as part of the evaluation of compatibility between donors and recipients in the context of organ and marrow transplants. GenDx's sequencing-based typing (SBT), for which it currently offers high-resolution products, is based on the most recent next-generation sequencing (NGS) technologies. The company develops and markets a complete family of products, including reagents for performing HLA typing and software for analyzing sequencing results, which is customized for different sequencing techniques (including NGS chimerism monitoring, a method for monitoring the state of hematopoietic stem cell transplantation), plus platforms and training modules. In addition to reagent kits and software, it offers custom lab tissue typing services to facilitate HLA research; the custom lab service results are for research use only. In 2021, GenDx generated €17m in revenue, for €6.9m in EBITDA.
Medtech Start-Up M&A Activity
Two medtech start-up acquisitions were penned during Q3 but only one had a disclosed potential deal value. SomaLogic entered into an agreement to acquire privately held DNA nanotechnology company Palamedrix, Inc. for up to $52.5m. Palamedrix provides deep scientific and engineering expertise, miniaturization technology, and enhanced ease-of-use capabilities that SomaLogic intends to leverage as it develops the next generation of its SomaScan Assay. Palamedrix’s technology uses DNA-based biosensors that capture small molecules present in biological samples to pinpoint the presence of any analyte with single-molecule accuracy. The platform can organize and interrogate many millions of these biosensors on a surface to deliver comprehensive data and a complete view of a patient’s biochemistry from a single sample.
In the other transaction, Boston Scientific Corporation acquired private biomaterials company Obsidio, Inc. The 2019 start-up developed the Gel Embolic Material (GEM) technology, which received 510(k) approval in July 2022 as a Class II device for use in peripheral vasculature in the embolization of hypervascular tumors and blood vessels to control bleeding/hemorrhaging. The single-use device is a semi-solid, proprietary material consisting of a pre-hydrated bioresorbable gelatin/layered silicate mixture and tantalum powder, packaged in a ready-to-use form with a syringe, thus reducing the preparation time required for many embolization procedures. Physicians inject the GEM agent into a target vessel through intravascular catheter, and its gel-like composition enables controlled placement within patient anatomy. Unlike solid and liquid embolics that can take time to form an obstruction to blood flow, once placed, GEM conforms to the targeted vasculature, immediately creating a barrier.
Biopharma Alliances
During Q3 2022 a total of 181 partnerships were signed, together worth $37.6bn in potential deal value (PDV), for the 72 deals with disclosed values. Of this set, 12 reached or surpassed a billion dollars (see Exhibit 5).
|
Date |
Licensee/Licenser |
Deal Subject(s) |
Terms |
|
Aug. 3 |
Roche/Poseida Therapeutics |
Roche receives exclusive global license to Poseida’s existing lead allogeneic CAR-Tcell therapies P-BCMA-ALLO1 and P-CD19CD20-ALLO1; an option to license exclusive global rights to allogeneic CAR-Tcell therapy products from Poseida's existing preclinical P-BCMACD19-ALLO1 andP-CD70-ALLO1 programs; can choose up to six additional allogeneic CAR-T cell therapy candidates partners explore together; and an option for non-exclusive license to Poseida intellectual property to develop and sell its own cell therapy products for up to three solid tumor targets |
$6.1bn: $110m up front; up to $110m in near-term milestones and other payments; up to $1.5bn in reimbursements, fees, and milestones for P-BCMA-ALLO1 and P-CD19CD20-ALLO1 license; up to $1.1bn in reimbursements, fees, and milestones for optioned P-BCMACD19-ALLO1andP-CD70-ALLO1 projects; up to $2.9bn in fees and milestones for optioned allogeneic CAR-T cell candidates; plus $415m in fees and milestones for non-exclusive license to Poseida’s IP for solid tumor targets; 1-29% royalties |
|
Aug. 16 |
Merck & Co./Orna Therapeutics |
Collaboration to discover, develop, and commercialize multiple engineered circular RNA (oRNA) programs, including vaccines and therapeutics in the areas of infectious disease and oncology, using Orna’s oRNA-LNP technology platform |
$3.65bn: $150m up front, up to in $3.5bn in development, regulatory, and sales milestones associated with the progress of the multiple vaccine and therapeutic programs; undisclosed royalties |
|
Jul. 5 |
Sanofi/Skyhawk |
Collaboration agreement to discover and develop novel small molecules that modulate RNA splicing for oncology and immunology targets using Skyhawk’s SkySTAR platform; Sanofi gets worldwide exclusive licenses to candidates discovered and developed that are directed to program targets; following DC status, Sanofi assumes responsibility for further development and commercialization |
$2.05bn: $54m in cash up front, $2bn in milestones; undisclosed royalties |
|
Aug. 10 |
Bristol Myers Squibb/GentiBio |
Multi-year collaboration in which GentiBio applies its modular engineered Treg platform and scalable manufacturing process to produce disease-specific engineered Tregs against multiple targets, including inflammatory bowel diseases (IBD); BMS has the right to develop and advance up to three of the resulting programs into clinical trials |
$1.9bn: undisclosed cash up front, up to $1.9bn in development and sales milestones; undisclosed royalties |
|
Aug. 1 |
Ipsen/Marengo |
Multi-year partnership to advance two undisclosed Marengo preclinical STAR platform-generated immuno-oncology candidates into the clinic; Marengo leads preclinical development and will expense related costs until the submission of an IND application to the USFDA; Ipsen will assume responsibilities for clinical development and commercialization |
$1.64bn: $45m cash up front, up to $1.592bn in milestones; undisclosed tiered royalties |
Four of the top five Q3 alliances involved Big Pharma, including the largest; a potential multi-billion dollar global collaboration between Roche Holding AG and Poseida Therapeutics, Inc. to research and develop multiple existing and novel off-the-shelf allogeneic CAR-T therapies against targets in multiple myeloma, B-cell lymphomas, and other hematologic indications. For a subset of both the Poseida portfolio programs licensed (P-BCMA-ALLO1 (Phase I) for multiple myeloma, and P-CD19CD20-ALLO1 for B-cell malignancies (IND expected in 2023)) or optioned (P-BCMACD19-ALLO1 (multiple myeloma) and P-CD70-ALLO1 (blood cancers)) to Roche and the parties' future collaboration programs, Poseida will conduct the Phase I studies and manufacture clinical materials before transitioning the programs to Roche for further development and commercialization. Roche will be solely responsible for the late-stage clinical development and global commercialization of all products.
In another cell therapy-focused partnership, Bristol Myers Squibb Company and GentiBio, Inc. aim to develop new engineered regulatory T cell (Treg) therapies to re-establish immune tolerance and repair tissue in inflammatory bowel disease (IBD) patients. The deal brings together BMS’ leadership in cell therapies and immunology with GentiBio's proprietary modular engineered Treg platform and scalable manufacturing process to generate scalable, stable, highly-selective, and durable Tregs against multiple targets.
Merck & Co., Inc. and Orna Therapeutics, Inc. entered a collaboration for multiple vaccines and therapeutics in the areas of infectious disease and oncology using Orna’s oRNA-LNP platform. The proprietary oRNA technology creates circular RNAs (oRNAs) from linear RNAs by self-circularization. Newly synthesized oRNA molecules are more compactly packaged into custom lipid nanoparticles (LNPs), which Orna has engineered to target key tissues in the body. Merck also invested $100m in Orna’s concurrent $221m Series B financing round. Orna will retain rights to its platform and will continue to advance other wholly owned programs in areas such as oncology and genetic disease. (Also see "Merck Buys Into Orna's Circular RNA Platform With Emphasis On Vaccines" - Scrip, 16 August, 2022.)
In addition to the Roche/Poseida deal, two other of top five alliances were also immuno-oncology-focused partnerships. (And overall, there were 31 partnerships in the I-O space completed during the quarter.) One involves Sanofi and Skyhawk Therapeutics, Inc. in a collaboration to discover and develop novel small molecule candidates in oncology and immunology using Skyhawk’s SkySTAR technology. Skyhawk’s platform integrates proprietary computational biology tools, kinetic models, and conformational structural models of RNA to build small molecules that modulate RNA splicing. It aims to address the underlying genetics of disease to modify the expression of target genes that have been considered undruggable. (Also see "Sanofi Continues Hunt For External Innovation With Skyhawk Deal" - Scrip, 06 July, 2022.)
The other I-O deal is a partnership between Ipsen SA and Marengo Therapeutics, Inc. to advance two of Marengo’s preclinical Selective T Cell Activation Repertoire (STAR) platform-generated candidates into the clinic. STAR is a multi-specific fusion protein library that targets specific TCR Vβ variants fused to different co-stimulatory moieties to develop potent T cell activators. Specific candidates for the partnership were not disclosed, but Marengo’s early-stage pipeline includes lead project STAR0602 (tumor agnostic), STAR002 and STAR003 for solid tumors, and STAR004 and SKAR001 for cold tumors. The collaboration will sustain Ipsen’s presence in oncology by leveraging Marengo’s novel discovery of the TCR Vβ-targeted precision T cell activation approach.
Big Pharma (pharmaceutical companies with a market cap of $30bn or greater) penned 40 biopharma alliances in all during Q3 (see Exhibit 6), accounting for 22% of the overall deal volume. The 26 transactions with disclosed values totaled $26.9bn, making up 71% of the Q3 aggregate dollar value.
In addition to having the largest money deals of the quarter, Merck & Co., Roche, and Sanofi were also tied for first place as most deal active, with seven partnerships apiece. Merck established a research collaboration and licensing deal worth up to $1.1bn with Cerevance Inc. for the discovery of novel targets in Alzheimer’s disease. (Also see "Merck Takes A New Shot At Alzheimer’s With Cerevance Deal" - Scrip, 10 August, 2022.) Roche partnered with Avista Therapeutics, Inc. to develop next-generation AAV gene therapy vectors for retinal disease indications in a deal worth up to $1bn. (Also see "Roche Inks Another AAV Capsid Platform Technology Deal, With Avista Therapeutics" - Scrip, 19 July, 2022.) Sanofi’s activity included two other tie-ups that each reached just over a billion dollars apiece: a collaboration to use molecular engineering company Scribe Therapeutics, Inc.’ CRISPR genome editing technologies to enable genetic modification of novel natural killer (NK) cell therapies for cancer, and a research partnership with Atomwise, Inc. using its AtomNet AI-powered discovery platform for up to five undisclosed drug targets. (Also see "Sanofi ThiNKs Scribe’s CRISPR Approach Can Advance Its NK Cell Therapy Goals" - Scrip, 27 September, 2022.) (Also see "Sanofi Looks To Atomwise For More AI Help" - Scrip, 17 August, 2022.) Novo Nordisk came in second, with three alliances, followed by BMS, Eli Lilly and Company, GSK, Takeda Pharmaceutical Co. Ltd. and Vertex Pharmaceuticals Incorporated, which each had two deals apiece.
The most popular therapeutic area for biopharma partnering during Q3 was oncology; that indication was the subject of 78 collaborations and brought in an aggregate $23.4bn in PDV (for the 29 deals with disclosed values), with seven deals meeting or exceeding the billion-dollar mark. Deals around infectious disease and neurology/psychiatry were tied for the second-most numerous, with 24 partnerships each. There was also noticeable alliance activity in deals without a specified therapeutic focus, for which there were 23 deals (see Exhibit 7).
Start-Up Alliances
Forty-eight partnerships involving biopharma start-ups were signed during the quarter. Four of them had a potential deal value of $1bn+ (see Exhibit 8). Topping the list was a $3.65bn alliance between Merck and Orna Therapeutics to discover, develop, and commercialize multiple programs, including vaccines and therapeutics in the areas of infectious disease and oncology. Merck paid Orna $150m up front and could shell out up to $3.5bn in development, regulatory, and sales milestones associated with the progress of the multiple vaccine and therapeutic programs, as well as royalties on any approved products derived from the collaboration. Orna will retain rights to its oRNA-LNP technology platform and will continue to advance other wholly owned programs in areas such as oncology and genetic disease. (Also see "Merck Buys Into Orna's Circular RNA Platform With Emphasis On Vaccines" - Scrip, 16 August, 2022.)
|
Headline/Potential Deal Value* |
|
Merck and Orna Therapeutics Collaborate to Advance Next Generation of RNA Technology / $3.65bn |
|
GentiBio Announces Collaboration with Bristol Myers Squibb to Pioneer Engineered Treg Therapies for Inflammatory Bowel Diseases / $1.9bn |
|
Elevation Oncology Licenses EO-3021 from CSPC Pharmaceutical Group / $1.18bn |
|
Avista Therapeutics Partners with Roche to Develop Next-Generation AAV Gene Therapy Vectors / $1bn |
|
Ventus Therapeutics Enters Exclusive Development and License Agreement with Novo Nordisk for NLRP3 Inhibitor Program / $703m |
|
Vertex and Verve Therapeutics to Collaborate on Gene Editing Program for Liver Disease / $466m |
|
Organon and Cirqle Biomedical Enter License Agreement for Investigational Contraceptive Candidate / $370m |
|
Emergence Therapeutics Licenses Synaffix ADC Technology Platform / $360m |
|
IDRx Licenses Tyrosine Kinase Inhibitor from Blueprint / $217.5m |
|
Novaremed Enters Into License Agreement With NeuroFront for NRD.E1 in China / $130m |
GentiBio entered into a multi-year collaboration with Bristol Myers Squibb to develop new engineered regulatory T cell (Treg) therapies to re-establish immune tolerance and repair tissue in patients living with inflammatory bowel diseases. The collaboration brings together GentiBio's proprietary engineered Treg platform for generating scalable, stable, highly selective, and durable Tregs with Bristol Myers Squibb's leadership in cell therapies and immunology. GentiBio will apply its modular engineered Treg platform and scalable manufacturing process to produce stable and disease-specific engineered Tregs against multiple targets. Bristol Myers Squibb will have the right to develop and advance up to three of the resulting programs into clinical trials. Bristol Myers Squibb made an undisclosed upfront cash payment to GentiBio and could pay development and sales milestones of up to $1.9bn, plus royalties.
In the Q3 alliance with the third-largest price tag, CSPC Megalith Biopharmaceutical licensed Elevation Oncology exclusive rights to develop and commercialize EO-3021 (SYSA1801) in all global territories outside Greater China (mainland China, Hong Kong, Macau and Taiwan). In exchange, CSPC will receive an up-front payment of $27m, up to $148m in potential development and regulatory milestone payments, $1.0bn in potential commercial milestones, and sales royalties. The antibody-drug conjugate (ADC) targeting Claudin18.2 is currently being evaluated by CSPC in a Phase I, dose-escalation clinical trial in China. Elevation Oncology expects to initiate a Phase I clinical trial evaluating EO-3021 in the US in 2023. (Also see "Chinese Biotechs Partner Up 18.2-Targeting ADCs Amid Intense Domestic Competition" - Scrip, 28 July, 2022.) In connection with the agreement, Elevation Oncology secured a $50m senior secured loan facility from funds managed by K2 HealthVentures.
Medtech Company Dealmaking
Device companies signed a total of 17 partnerships during Q3; five had disclosed financials, together totaling $202.6m. In the highest-valued deal, Medtronic plc entered into a co-promotion agreement with private Israeli device firm CathWorks Ltd. (developing AI-based technology to improve the evaluation and diagnosis of coronary artery disease); Medtronic will invest up to $75m and immediately begin co-promotion of CathWorks' FFRangio system in the US, Europe, and Japan, where it is commercially available. FFRangio is an AI-augmented imaging system that calculates FFR (fractional flow reserve), a diagnostic technique that evaluates the physiologic impact of coronary artery stenosis. Once certain milestones are met, Medtronic gets an option to acquire the company outright for an estimated $585m.
Diagnostics and research firms completed 13 alliances during Q3. In the only one with a disclosed value, MDxHealth SA acquired the Oncotype DX GPS (Genomic Prostate Score) test from Exact Sciences Corp. ’ subsidiary Genomic Health Inc. for up to $100m. MDxHealth paid $25m in cash and $5m will be settled through the delivery of MDxHealth American Depositary Shares. An additional amount of up to $70m is payable upon achievement of certain revenue milestones related to fiscal years 2023 through 2025.
The Oncotype DX GPS test, a genomic assay designed for men with low-, intermediate-, and high-risk localized prostate cancer, is designed to analyze prostate cancer gene activity to predict disease aggressiveness and provide clinically meaningful endpoints. The deal further solidifies MDxHealth’s position in the precision diagnostics urology market. In addition to this agreement, four other diagnostics alliances in the oncology space were completed during Q3.
Four diagnostics alliances involving start-ups were signed in the third quarter. No device alliances were penned (see Exhibit 9).
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Date |
Partners |
Deal Subject(s) |
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Jul. 28 |
NeuroSense Therapeutics/NeuraLight |
Collaboration to advance digital biomarkers in the detection and monitoring of neurological diseases, including amyotrophic lateral sclerosis (ALS); NeuraLight's platform uses proprietary computer vision and deep learning algorithms to extract over 100 occulometic markers from facial videos captured with a standard webcam; NeuroSense is conducting a Phase IIb trial evaluating the efficacy of lead drug candidate, PrimeC in the treatment of ALS; the alliance entails sharing and tracking patient data to advance the identification and use of ALS digital biomarkers in a parallel study conducted by NeuraLight |
|
Aug. 22 |
DxGen/Precision Diabetes |
Exclusive agreement whereby Precision Diabetes will launch DxGen's Epithod AutoDx in the US; Epithod AutoDx, a small fully-automatic point-of-care analyzer, measures a comprehensive profile of diabetes tests; the initial test menu will begin with hemoglobin A1c, C-reactive protein, and urinary albumin, with additional diabetes tests to be added in the near future |
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Sept. 14 |
Qiagen/Neuron23 |
Agreement to develop a companion diagnostic (CDx) for Neuron23’s brain penetrant leucine-rich repeat kinase inhibitor for Parkinson’s disease; Qiagen will develop and validate a clinical trial assay that will detect a combination of biomarkers discovered by Neuron23 that together predict the responsiveness of PD to Neuron23’s LRRK2 inhibitor; the partnership will support the clinical development of Neuron23’s drug candidate currently in late preclinical studies; the agreement also covers options for future development of additional CDx; the assay will be integrated into a next-generation sequencing workflow that leverages Qiagen’s sample to insight capabilities, including instrumentation, IVD sample preparation, library preparation, and bioinformatics |
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Sept. 21 |
Foundation Medicine/Day One Biopharmaceuticals |
Collaboration to develop FoundationOne CDx as a CDx for Day One’s lead investigational therapy, tovorafenib (DAY101), an oral, brain-penetrant, highly selective type II pan-RAF kinase inhibitor in Phase II for the treatment of pediatric, adolescent and young adult patients with relapsed pediatric low-grade glioma; Day One has also initiated a pivotal Phase III study with tovorafenib in newly-diagnosed patients with pLGG and tovorafenib is additionally being evaluated alone and as a combination therapy for other recurrent or progressive solid tumors with MAPK pathway aberrations |