- Idera Pharmaceuticals announced on Monday a use for an autoimmune drug it shelved last year: selling off the treatment's rights to newly established Vivelix Pharmaceuticals.
- Vivelix is shelling out $15 million upfront for IMO-9200, a drug that works to inhibit expression of a few members of a protein class called toll-like receptors (TLRs). The deal also lines up as much as $140 million in milestone payments, along with net sales royalties in the mid-single-digit to low double-digit range.
- While the function of a TLR is to recognize foreign pathogens and alert the body's immune system, the proteins can lead to prolonged tissue inflammation if activated too frequently. This can promote the progression of autoimmune diseases like rheumatoid arthritis and multiple sclerosis.
Idera discontinued development for IMO-9200 in 2015, saying the drug wasn't a strategic fit for the company due to the "large autoimmune disease indications" it targeted, according to the company's most recent quarterly filing with the Securities and Exchange Commission.
Though it's not particularly uncommon for a drugmaker to license out a candidate it's no longer investigating, the agreement with Vivelix will bring a significant boost to clinical-stage Idera's cash position. The company reported just $22 million in cash and cash equivalents as of Sept. 30.
The agreement could also quell some investor concerns that sprouted up in early October, when Idera reported the pricing of a secondary public offering. The company offered an additional 25 million shares of common stock valued at $2 per share to raise money for further development of its oncology and autoimmune drug candidates.
Following that announcement, Idera stock fell more than 16%. Shares were up about 2% to $1.87 in Monday morning trading.
Meanwhile, this is the first noteworthy deal for Vivelix, which a handful of former Salix Pharmaceuticals employees founded earlier this year. The privately-held company is working to develop a portfolio of treatments for gastrointestinal and liver diseases.
“The team at Vivelix has a tremendous track record in successful development and marketing of products in the gastrointestinal disease category,” Idera CEO Vincent Milano said in a Nov. 28 statement.
Should IMO-9200 not work out, Vivelix has a failsafe agreement in place that leaves Idera on the hook to create back-up compounds. While the companies did not give further details on that provision, Vivelix will offer up to $52.5 million for the creation and sale of the compounds, as well as royalty payments.