- Alexion Pharmaceuticals is ditching three partnerships as part of continued efforts to refine the company's R&D focus around core therapeutic areas.
- Moving forward, drug development will center on hematology, nephrology, neurology and metabolic disorders, Alexion leadership said during a second quarter earnings call on Thursday. To that end, the rare disease company has terminated collaborations with Arbutus Biopharma, Blueprint Medicines and, most surprisingly, venture capital darling Moderna Therapeutics.
- Alexion is also out-licensing ALXN1101, a treatment for Molybdenum Cofactor Deficiency (MoCD) Type A that is currently in a registrational trial, and samalizumab, a novel checkpoint inhibitor under investigation in acute myeloid leukemia and solid tumor patients.
With strong revenues pouring in, Alexion is looking to double down in what it knows best. That means more work in rare disease and a dedication to drugs that affect the complement system, a piece of the immune system.
ALXN1210, an anti-C5 antibody being investigated as a treatment for paroxysmal nocturnal hemoglobinuriane (PNH), is one priority, so much so that Alexion attributed the rise in its GAAP R&D expenses, which were nearly $200 million during the second quarter, to clinical investments in the candidate.
"We've evaluated over 90 complement-mediated rare disorders and are targeting to initiate up to two proof-of-concept studies in 2018 with ALXN1210 in additional indications beyond the Soliris therapeutic footprint," John Orloff, Alexion's head of R&D, said during the July 27 earnings call. "We will also leverage our proprietary bioinformatics to strengthen disease understanding and provide insights into the epidemiology of rare diseases."
Yet evidently, several partnerships aren't fitting into Alexion's future goals.
The collaboration with Blueprint was to develop and commercialize treatments for fibrodysplasia ossificans progressiva, the one with Arbutus for lipid nanoparticles, and the one with Moderna for mRNA therapeutics for rare diseases.
On Thursday, Blueprint shares fell nearly 7% to $52.26 apiece while Arbutus shares fell 5.4% to $3.50 apiece. Conversely, Alexion's stock opened at $139, up 6% from the Wednesday close. The company's shares petered back down, though, to $133.92 by Thursday's close.
Jefferies analyst Eun Yang had a positive view of the company's strategic review, saying in the note that it "removes unproductive R&D efforts." However, she still gave a Hold rating on Alexion due in part to the potential threat of competitors by 2021 and beyond and the pricing pressure the company's main product Soliris (eculizumab) is likely to experience due to its high cost and label expansion.
Alexion's revenues surged 21% year over year to $912 million during the second quarter. Soliris continued being the biggest source of the drugmaker's income, raking in $814 million in net product sales during the period.
About $35 million of that sum stemmed from favorable timing of Soliris orders, revenue that investment firm Jefferies noted wouldn't likely be repeated during the second half of the year. Alexion now expects revenue from the drug to reach as high as $3.125 billion for 2017, though Chief Financial Officer Dave Anderson said Soliris sales are expected to be lower in the back half.