Dive Brief:
- Biogen is set to receive as much as $250 million in funding to develop a late-stage experimental lupus medication called litifilimab after signing a deal with Royalty Pharma.
- In exchange, Royalty Pharma will receive unspecified payments if litifilimab hits certain regulatory milestones and mid-single digit royalties on worldwide sales. Payments amounting to as much as $250 million to Biogen would be spread over six quarters, Royalty said Wednesday.
- Biogen is currently conducting Phase 3 trials of litifilimab in patients with both systemic lupus erythematosus and cutaneous lupus erythematosus. The Massachusetts biotech expects to deliver results from the two trials in 2026 and 2027.
Dive Insight:
For Biogen, the deal offers a way to share the risk of an experimental medicine while preserving cash for other drugs in the pipeline. Biogen is looking to newer products to drive sales growth as its battles declining sales in the multiple sclerosis franchise that vaulted the company to the top echelons of the biotech industry.
Though Biogen on Wednesday reported fourth-quarter earnings that beat Wall Street expectations, analysts keyed in on what they called disappointing profit and revenue guidance for 2025. The company’s shares dropped about 5%, to just under $133 apiece, in early trading Wednesday.
Biogen said it’s expecting earnings between $15.25 and $16.25 per share for this year, compared with consensus of $16.33, according to Baird analyst Brian Skorney. While Biogen’s figure is affected by adverse foreign currency exchange rates, the guidance overall is “meh,” Skorney wrote to clients.
In that context, the Royalty deal offers some good news for Biogen, highlighting the potential of one of its more advanced experimental medicines. Royalty, founded in 1996, now receives royalties on more than 35 commercial products and is increasingly investing in research-stage medications.
Just in the last year or so, Royalty struck four deals — with BridgeBio Pharma, ImmuNext, Cytokinetics and Agios Pharmaceuticals — potentially worth more than $2.5 billion combined. The ImmuNext transaction gave Royalty access to royalties and milestone payments on a drug now under development by Sanofi.
