- An experimental drug to treat the inflammatory disease ulcerative colitis failed in a mid-stage trial, causing shares in its developer, Theravance Biopharma, to fall sharply in morning trading Tuesday. Called izencitinib, the drug didn't ease patient symptoms like bleeding and ulcers any better than a placebo, the company said.
- Theravance is still developing the drug for Crohn's disease, and a trial is due to report data later this year or early next. Nonetheless, executives said they will "minimize future expenses" on the program, for which Johnson & Johnson agreed to pay as much as $1 billion to acquire partial commercial rights in 2018.
- The partners are working together on a second drug for inflammatory bowel diseases as well, though it's still in early-stage testing. A more immediate way for Theravance to change its fortunes would be positive data from a Phase 3 trial of an experimental treatment for neurologically-driven low blood pressure. That study is expected to have results by the end of September.
Izencitinib is a JAK inhibitor, a type of drug that blocks an enzyme involved in inflammation. The drug class is well-established, having already produced multiple approved treatments for autoimmune diseases.
But JAK inhibitors are also weighed down by side effects like infections and blood clots that have drawn increased scrutiny from regulators. Last year, for instance, the Food and Drug Administration rejected filgotinib, a JAK drug developed by the Belgian biotech Galapagos. The agency has since delayed decisions on label expansions for other drugs amid a safety review.
Izencitinib was designed to be a more targeted, potentially safer than other JAK inhibitors by specifically aiming for gut tissues. Such a profile was meant to make the drug useful in treating diseases like ulcerative colitis — a condition only one other JAK drug, Pfizer's Xeljanz, is cleared to treat. That potential drew the interest of J&J, which paid Theravance $100 million up front in 2018 and promised another $900 million in milestones to co-develop the drug.
The prospects for izencitinib are now bleak, however, following the Phase 2 results reported Monday afternoon. The trial enrolled 239 patients who received one of three doses of izencitinib or a placebo. Investigators measured their progress using a tool called the Mayo Scale, which evaluates their symptoms or signs of inflammation on an imaging test.
Trial investigators saw no improvement broadly using izencitinib, nor when comparing any of the three doses separately against a placebo. Though an additional trial is underway, "in our view, this program appears to have no future, and we have no confidence that it will show benefit in Crohn's disease," wrote SVB Leerink analyst Geoffrey Porges.
Unlike many small- and mid-sized biotechs, Theravance has steady income to fall back on. The company has a royalty stream from GlaxoSmithKline's lung disease drug Trelegy as well as from a separate respiratory medicine, Yupelri, sold by Viatris.
Still, Theravance isn't profitable. The $21.2 million in collaboration revenue it earned in the first six months of 2021 was more than offset by $175 million in expenses, primarily research and development. Its upside now "depends almost exclusively" on the coming Phase 3 result for an experimental treatment known as ampreloxetine, Porges wrote.
The failure is less of a setback for J&J's immunology business, meanwhile, which is headlined by marketed products like Stelara and Tremfya, wrote Cantor Fitzgerald analyst Louise Chen.
Theravance shares had fallen 31% in late morning trading Tuesday, changing hands at $9.82.