Ionis Pharmaceuticals hasn’t gone far to find a new home for a therapy that could soon be one of two approved treatments for a rare neurodegenerative disease called transthyretin amyloidosis. It’s handing the drug, known as inotersen, to its own spinout, Akcea Therapeutics.
In a deal being announced this morning, Cambridge, MA-based Akcea (NASDAQ: AKCA) will pay Ionis (NASDAQ: IONS) $150 million in Akcea shares to split the rights to inotersen and a follow-up drug, currently known as IONIS-TTR-Lrx, for the same disease. Inotersen is now undergoing regulatory reviews in the U.S. and Europe and if approved, could hit the market later this year.
Inotersen is neck and neck in a race to the market with patisiran, a competing drug from Alnylam Pharmaceuticals (NASDAQ: ALNY). Both are RNA-based treatments for transthyretin amyloidosis, a rare, inherited condition in which proteins don’t fold into their normal shapes correctly. The misfolding makes them build up and cause damage to the nerves, heart, and other organs. The disease, which can be fatal, affects about 50,000 people worldwide, according to Carlsbad, CA-based Ionis. The only treatments for TTR are a liver transplant or Pfizer’s (NYSE: PFE) tafamidis (Vyndaqel), which is approved in Europe but not in the U.S.
The FDA is expected to decide whether to approve inotersen by July 6, and rule on Alnylam’s drug no later than Aug. 11. The two drugs purport different advantages commercially. Inotersen is more convenient because it can be injected just under the skin, while the Alnylam drug has to be infused intravenously. Alnylam has touted patisiran’s safety profile, while worrisome kidney problems and dangerously low platelet counts have cropped up in clinical studies of inotersen—meaning patients will likely require frequent monitoring. Ionis executives have downplayed those issues and countered that patients have to be prepped for Alnylam’s drug with analgesics and steroids, which might lead to complications after long-term use. (Here’s more on the various differences and back-and-forth between the two companies.)
Prepping for the battle ahead, Ionis has been looking for help to commercialize inotersen ever since GlaxoSmithKline (NYSE: GSK) dumped rights to the drug amid an R&D shakeup last year. When GSK bowed out, Ionis said it was looking for a new partner or considering forming a new subsidiary around inotersen. Instead, Ionis—which purposely licenses out the drugs it develops—sent the drug to an existing spinout, Akcea. Ionis’s two FDA-approved therapies are sold by Biogen (NASDAQ: BIIB) (Spinraza, for spinal muscular atrophy) and Kastle Therapeutics (Kynamro, for homozyguous familial hypercholesterolemia.)
Ionis considered several different options for commercializing inotersen, including “multiple offers” of licensing deals with companies large and small, according to chief business officer Sarah Boyce. Ionis weighed those deals against the capabilities of an affiliate it could create, as it did with Akcea.
Ionis formed Akcea to house and commercialize a group of Ionis drugs for rare metabolic diseases—the most advanced of which is volanesorsen, a drug for familial chylomicronemia syndrome headed for an FDA advisory panel in May. Ionis concluded that Akcea was best suited to get inotersen to patients quickly while also providing a path forward for IONIS-TTR-Lrx, Boyce said. That drug, in preclinical testing, is meant to be more potent and convenient than inotersen.
Akcea, which has been prepping for FDA approval of volanesorsen, now adds another drug that is close to market. Boyce said that structuring the transaction as a stock deal allows Akcea to save cash that can be used to commercialize both drugs. Some of the Ionis staffers who worked on inotersen will move to Akcea to support its launch, according to the deal.
Though Ionis spun out Akcea, which went public last year, it remains closely tied to the company, owning a majority (68 percent) stake. Those ties are becoming even more significant now: Ionis will buy $200 million in Akcea shares at $18.75 apiece in the inotersen deal, boosting its ownership to 75 percent. The agreement also includes various downstream payments to Ionis, like $90 million in total payouts for regulatory approvals in the U.S. and Europe. Those possible payments total $1.3 billion, though Akcea would have to hit unspecified sales targets for Ionis to receive them. The two companies will hold a conference call this morning to discuss the transaction.
Frank Vinluan contributed to this report.