Dive Brief:

• Bristol Myers agreed to pay $350 million up front to Philochem for worldwide rights to an experimental radiopharmaceutical to diagnose and treat prostate cancer.
• The agent, OncoACP3, has shown promise in a Phase 1 trial for diagnostic imaging of prostate cancer by accurately targeting tumors, Philochem said. The Swiss company, a subsidiary of the Philogen Group, is working toward applying for Phase 1 therapeutic testing of the medicine. 
• As part of the deal announced Tuesday, Philochem will be eligible for as much as $1 billion in additional payments for reaching certain development, regulatory and commercial milestones and will also receive royalties on sales if OncoACP3 wins regulatory approval. RayzeBio, the company Bristol Myers acquired to enter the radiopharmaceutical field, will develop the product.

Dive Insight:

Scientists have long known that radiopharmaceuticals held tremendous potential. By pairing a cancer-destroying radioisotope with a targeting molecule, the drugs can precisely deliver radiation into a tumor while sparing healthy tissue. But they are complex therapies, and early efforts faltered because of manufacturing issues, competition, high costs and safety concerns.

Technological advances have changed the picture, and the field has grown hot in recent years, with investors pouring money into companies both big and small. The larger pharmaceutical companies have been pursuing partnerships with smaller rivals as well as buying them outright.

Bristol Myers beat out two other big drugmakers with a $4.1 billion bid to buy RayzeBio not long after the company went public in one of 2023’s biggest new biotech stock offerings. Eli Lilly and AstraZeneca also paid top dollar to buy radiopharmaceutical companies in recent years.

The companies are eying the success of Novartis, a leader in the field with two radiopharmaceuticals approved to treat cancer, Pluvicto and Lutathera. Unlike Pluvicto, which binds to prostate cancer cells that express the PSMA protein, Philochem’s product has an affinity for an enzyme known as ACP3, offering a new target for RayzeBio.

RayzeBio’s top medicine works in a similar way as Lutathera with a different radioactive material. The company also has a number of other radiopharmaceuticals in development for cancer.