Rare Disease Firms BioMarin And Prosensa To Merge

In a risky but potentially profitable deal, orphan disease drug specialist BioMarin Pharmaceutical will pay $680 million to acquire Prosensa, a Dutch biotech firm with a late-stage compound to treat Duchenne muscular dystrophy (DMD), a rare, fatal disease. Prosensa shareholders could get another $160 million if the drug, drisapersen, gets approved in both the U.S. and Europe.

The deal adds yet another twist in the race to get a treatment for DMD, which affects only males, to market. Prosensa is neck and neck with Sarepta Therapeutics, a Cambridge, Mass.-based biotech that is developing its own DMD drug, eteplirsen. Both drugs use antisense technology that enables the production of a shortened version of dystrophin, a critical protein that is missing from the muscles of boys with DMD.

Drisapersen could become the biggest product in BioMarin’s portfolio, the firm’s CEO, Jean-Jacques Bienaimé, said in a presentation discussing the acquisition.

But drisapersen has a checkered past: GlaxoSmithKline licensed the drug in 2009, only to return it to Prosensa earlier this year after a Phase III study failed to prove it could help boys with DMD walk better. Prosensa argues that data from a smaller Phase II study suggest the drug helps boys with less-advanced disease.

FDA is allowing Prosensa to file for approval of drisapersen—a process the company began in October—but it is requiring two additional studies. If the results from those trials come back negative, the drug could be pulled from the market.

Although BioMarin went to great pains in its presentation to make the case for approval of drisapersen based on existing data, industry watchers see significant uncertainty. “We think there is much risk,” Cowen & Co. stock analyst Phil Nadeau wrote in a note to investors. With two failed studies, “there a good chance that the regulators require another Phase III prior to approval.”

But Nadeau also points out that the potential rewards are great: Because DMD has no approved treatment, the market for drisapersen could be as much as $3 billion per year.