Biogen is opening up its checkbook again to get its hands on innovative approaches to some brain disorders that have proven especially recalcitrant to new types of treatment.
The Cambridge, MA-based neuroscience drug developer is paying gene editing company Sangamo Therapeutics (NASDAQ: SGMO) $350 million up front in a collaboration on potential one-time treatments for neurodegenerative conditions including Alzheimer’s and Parkinson’s diseases.
The “ambitious and expansive” collaboration will leverage gene-editing technology developed by Brisbane, CA-based Sangamo, which uses so-called zinc finger proteins to target and modify certain genes tied to a specific disease, and Biogen’s extensive experience in neuroscience drug development, said Sangamo CEO Sandy Macrae on a conference call Friday.
The upfront payment consists of $125 million cash and the purchase of $225 million worth of Sangamo stock. Sangamo’s stock price soared after the companies announced the deal, closing up nearly 30 percent Thursday at $8.63 per share. (Biogen shelled out $9.21 apiece for about 24 million shares.) Biogen (NASDAQ: BIIB) saw its stock price fall 5 percent to about $310 apiece.
Sangamo is eligible for up to $925 million in payments connected with precommercial activities and nearly $1.5 billion tied to commercial and sales milestones—up to $2.37 billion in total, plus royalties.
Under the deal terms, Biogen gets global rights to ST-501, a Sangamo drug designed to target tauopathies, or neurodegenerative disorders characterized by the deposition of abnormal tau protein in the brain, including Alzheimer’s disease. The company also gets ST-502, which targets synucleinopathies, the abnormal accumulation of aggregates of alpha-synuclein protein, including Parkinson’s disease. Sangamo calls these preclinical candidates gene regulation therapies, and it delivers them using adeno-associated viruses.
In addition to those experimental therapies, Biogan gains an undisclosed neuromuscular target, plus the rights to up to nine more additional targets over five years.
Sangamo will handle early research activities, for which the companies will share the costs, and manufacturing for the first clinical trials for the first three products of the collaboration; Biogen is responsible for manufacturing for all additional trials, as well as related regulatory interactions and commercialization.
The companies have teamed up before: In 2014, they struck a deal to co-develop a group of drugs to treat inherited blood diseases.
Neuroscience drug developers—including Biogen—have struggled mightily to come up with disease-modifying treatments for Alzheimer’s and Parkinson’s, available treatments for which only address symptoms.
“That’s why the promise of genomic medicine to provide a one-time treatment that addresses the underlying cause of disease at the DNA level is so powerful,” Macrae said on the call.
Today Biogen has five Alzheimer’s programs and two Parkinson’s programs in development. Soon the company is anticipated to submit its lead Alzheimer’s candidate, aducanamab, to the FDA. The partnership with Sangamo gives Biogen the opportunity to explore another potential avenue to treatments.
“The ability to switch genes on and to switch genes off in the brain precisely and with great specificity is a really exciting new development in the application of genomic medicine to neuroscience,” said Adrian Woolfson, Sangamo’s executive vice president of research and development.
Big collaborations aren’t out of character for the biotech: Macrae, on the call, noted the company’s strategy has been to simultaneously develop its own proprietary product candidate pipeline and to partner when it needs access to therapeutic area expertise or financial resources to move programs forward.
The new deal roughly doubles the amount of money that prior partnerships have netted the company. Agreements with Gilead (NASDAQ: GILD), Pfzier (NYSE: PFE), Sanofi (NYSE; SNY), and Takeda (NYSE: TAK) have collectively brought in about $350 million, more than half of that from an oncology tie-up with Gilead. Biogen’s investment comes the quarter after Sangamo transferred its most advanced program, a hemophilia A gene therapy program, to Pfizer, which is evaluating the treatment in a Phase 3 study. Sangamo banked $25 million in that transaction.