You remember reports a few years back of Takeda’s $15 billion M&A war chest for biotechs? Well, it hasn’t spent that much yet, but already this morning, and on the eve of J.P. Morgan, it’s struck two deals as it looks to make good on its ongoing R&D reorganization.
The Japanese pharma announced first thing it was spending €520 million ($627 million) in an all-cash deal to acquire TiGenix and its experimental stem cell therapy for Crohn’s.
Just a few hours later, and it’s at it again, in a $150 million upfront deal in cash and stock (with around $90 million in milestones and other opt-in payments) with newly IPO’d Denali with a “a strategic option and collaboration agreement” to work on and sell up to three candidates for neurodegenerative diseases.
“Each program is directed to a genetically validated target for neurodegenerative disorders, including Alzheimer’s disease and other indications, and incorporates Denali’s ATV platform for increased exposure of biotherapeutic products in the brain,” the pair said in a statement.
Under the pact, Denali will be responsible for all development activities and costs prior to IND filing for each of the three programs. Takeda holds on to the option to help work on and sell each of the three programs. If it does, then they will together work on clinical development and share all costs equally.
Denali will lead early clinical development activities, while Takeda will lead late-stage clinical development. Takeda and Denali will together sell any drugs coming out of the collaboration in the U.S. and China, but Takeda will have exclusive selling rights in all other markets.
It’s been a good few weeks for the biotech, as just a month ago, South San Francisco, California-based Denali got off the biggest IPO of 2017, raking in $250 million for its work on Alzheimer’s and Parkinson’s diseases. And that was during a year when the biotech IPO market came roaring back.
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“We are impressed with Takeda’s commitment to developing treatments for difficult to treat neurodegenerative diseases and look forward to partnering with them to bring medicines to patients,” said Denali CEO Ryan Watts, Ph.D. “Takeda has a great track record of partnering with biotech firms in addition to unique development expertise and a strong global commercial presence.”
The Japanese company has been doing much to try to shake up its research, both internally and with a swath of deals in recent years. In the fall of 2016, Takeda announced a major shake-up of its clinical and drug development as it moved hundreds of its staff over to PRA Health, with the intention of it taking control of much of its operations in the U.S. and Europe.
The first part of this deal saw the Raleigh, North Carolina-based CRO take the lead on Takeda’s marketed products, clinical development and postapproval needs, and also saw PRA manage an entire pipeline of studies for Takeda, across all phases of human development and after approval, while also providing regulatory, drug safety and other operational services for both development and marketed product portfolios.
Five months later, the pharma made another major decision that creates a new joint venture between Takeda and PRA, with each holding 50% of the share respectively, to “provide clinical trial delivery and pharmacovigilance services as a strategic partner of Takeda in Japan.”
Takeda has also been retooling its R&D with a focus on three therapy areas—oncology, gastroenterology and central nervous system—while also shutting down or de-emphasizing other overseas R&D centers
It has also taken a keen interest in U.S. biopharmas, spending over $5 billion on cancer biotech Ariad, as well as paying $125 million for a T-cell research deal with biotech Maverick that comes with a 5-year buyout clause.
In a similar deal structure, it also said it would pay $35 million for tiny, early-stage PvP Biologics in a GI pact, with an acquisition also here on the cards.
Takeda and VC Lightstone also came together to launch Cerevance, a new company focused on neuroscience R&D for neurological and psychiatric disorders that will get the help of U.K. scientists (a country it had looked to largely exit from) and be headed up by biotech vet Brad Margus.