- Johnson & Johnson could end up paying more than $1 billion for a clinical-stage biotech's digestion drug.
- The big pharma has locked down exclusive worldwide rights to co-develop and market Protagonist Therapeutics' PTG-200, an oral interleukin 23 (IL-23) inhibitor under pre-clinical investigation as a treatment for inflammatory bowel disease (IBD). The companies expect the drug to move into human testing during the second half of 2017.
- IL-23 is a type of small protein that research has shown regulates T-cell function, and therefore plays a role in immune responses — particularly those that involve inflammation. Johnson & Johnson's Stelara (ustekinumab), approved for indications such as psoriatic arthritis and Crohn's disease, is one example of an IL-23 inhibitor.
Drugmakers have increasingly stocked their pipelines and portfolios with medications targeting IL-23 proteins and receptors, recognizing the potential benefits to patients and bottom lines. Last year, for instance, Johnson & Johnson touted that its candidate guselkumab outperformed AbbVie's Humira (adalimumab) in a Phase 3 trial testing the drugs in patients with moderate to severe plaque psoriasis.
Johnson & Johnson submitted guselkumab to the Food and Drug Administration for approval in November, and expects it to achieve blockbuster status if approved. While the company's immunology portfolio remains highly profitable, raking in $2.93 billion, or 36% of net revenues, during the first quarter alone, it has also been relatively stagnant as of late — growing just 0.7% from the same period in 2016
PTG-200 represents another source of fresh blood for that portfolio. Janssen, Johnson & Johnson's pharma arm, is pledging $50 million upfront for PTG-200, with another $940 million in various milestone payments at stake. Protagonist can also reap double-digit tiered sales royalties should its drug make it to market, meaning the overall deal size could exceed $1 billion.
Protagonist had been in deal talks with multiple partners interested in PTG-200 for about seven to nine months before inking the agreement with Janssen, according to CEO Dinesh Patel. "It's fair to say that even up to a month ago there [was] more than one scenario, and then finally it starts crystallizing out," Patel said in an interview with BioPharma Dive.
What sold Patel and his company on partnering with Janssen was the company's leadership in the IBD space, as well as its work with developing and rolling out Stelara. Notably, Protagonist had also received $14 million in Series B financing back in 2013, led by Johnson & Johnson Development Corporation. Lilly Ventures contributed to that financing as well, though Patel declined to comment on whether Eli Lilly was another drugmaker in talks for PTG-200.
A large part of PTG-200's appeal to Janssen and others, Patel added, was that it's an oral medication. Since many anti-inflammatories are administered through injection, Protagonists' drug offers a mode of treatment that can be safer and more highly adhered to.
"We work on those biological targets that are already validated by injectable antibody drugs, so we're not taking on target risk in that sense," Patel said. "For a chronic indication where a patient unfortunately has to take the drug for the rest of their lives, an oral drug would be much preferred."
"We’re particularly excited to add an oral peptide-based therapy to our robust portfolio as we aim to address the increasing incidence of inflammatory bowel disease and the growing needs of people living with Crohn’s disease and ulcerative colitis around the world," Scott E. Plevy, Janssen's disease area leader for inflammatory bowel disease, said in a statement.
The Newark, CA-based biotech has two other drugs in its pipeline: PTG-100, a Phase 2 treatment for moderate to severe ulcerative colitis, and PTG-300, a pre-clinical drug for rare diseases in which there's too much iron in patients' bodies. Patel said his company has decided not to seek partners on PTG-100, since the money raised through a 2016 initial public offering can finance the medication through Phase 2 development.
Protagonist saw shares jump more than 40% on Tuesday morning, hitting $11.58 apiece.