Geron’s Drug Alliance with Janssen Terminated, Shares Plummet 68%

Xconomy San Francisco — 

Four years after Geron landed a pharmaceutical partner to co-develop its lead drug, the Menlo Park, CA, biotech is now moving forward with the compound on its own.

Janssen Biotech is ending the collaboration with Geron on imetelstat, a drug that had reached mid-stage clinical trials as a treatment for blood disorders. The Johnson & Johnson (NYSE: JNJ) subsidiary said the decision to return the drug’s rights followed a review of its own drug portfolio. After the news was announced Thursday morning, Geron’s stock price sank more than 68 percent to $1.97 per share.

Imetelstat blocks an enzyme called telomerase. Under the Geron and Janssen partnership, the drug had been studied in Phase 2 tests for myelofibrosis, a form of leukemia, and for myelodysplastic syndrome (MDS), a disorder in which the bone marrow doesn’t produce enough healthy blood cells. Following Janssen’s decision, Geron said it is now planning to advance the drug into a Phase 3 study for MDS.

When the collaboration agreement ends Friday, all rights to imetelstat will return to Geron. [Transferring the project to Geron, including regulatory and clinical trial work, is projected to take one year. Geron said Janssen is expected to continue manufacturing the drug for clinical trials for up to two years. Patients currently enrolled in the clinical studies will still be supported during the transition, the companies said.

Here’s more background on Geron’s collaboration with Janssen.

Image by Flickr user Ed Uthman, via a Creative Commons license