- Lexicon Pharmaceuticals agreed to buyout the exclusive research, production and marketing rights to a neuroscience drug from its partner Bristol-Myers Squibb, the company announced Tuesday.
- The deal amends a collaboration and licensing agreement the companies forged in 2003 to discover new neuroscience candidates. Its terms require Lexicon to pay Bristol-Myers as much as $90.5 million in milestone payments, as well as single-digit royalties on global sales.
- The drug, called LX9211, aims to alleviate chronic nerve pain. The treatment has wrapped up pre-clinical testing and is scheduled to enter Phase 1 trials in 2017.
Reshaping pipelines has been a big trend for pharmaceutical providers throughout 2016, and this deal continues that theme.
Bristol-Myers has been preoccupied locking down market dominance for Opdivo and picking up cancer and biologics platforms, so leaving LX9211 behind isn't that big of a hit. The decision is surely helped by the fact that the pharma giant only has one real neuroscience offering in Abilify, which reported just $29 million in sales last quarter, according to its most recent 10-Q filing with the Securities and Exchange Commission, after losing patent exclusivity in 2014.
"Our four strategic priorities are to drive business performance, maintain our leadership in immuno-oncology, maintain a diversified portfolio both within and outside of immuno-oncology and continue our disciplined approach to capital allocation, with business development as a priority," the pharma giant said in the filing.
Lexicon will pay Bristol-Myers milestone payments up to $34.5 million for LX9211's first indication, $16 million for the drug's second and third indications, and $40 million for sales performance. Based in Woodlands, TX, the drugmaker reported $38.8 million in cash and cash equivalents as of September 30, according to a 10-Q form filed with the SEC.
Additionally, Lexicon has agreed to dole out up to $25 million in milestone payments for each of the other neuroscience drugs co-developed with Bristol-Myers. Broken down, the payments include $1.5 million for any Investigational New Drug (IND) filings, $2.5 million for any commencement of a Phase 2 trial or Market Authorization Application (MAA), $5 million for any commencement of a Phase 3 trial or New Drug Application (NDA), and $8.5 million for the approval in the U.S. or Europe.
"Working together with Bristol-Myers Squibb, we have accumulated an extensive amount of data supporting the potential of LX9211 for neuropathic pain and other chronic pain indications," Lexicon's executive vice president of research and development Praveen Tyle said in the statement. "With the nearing completion of IND-enabling studies, we are planning to advance LX9211 into the clinic next year so that patients in an area of high unmet need can benefit from this innovation."