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Cancer Immunotherapy Deal Mania Continues

Pharmaceuticals: Novartis and Merck Serono broaden their immuno-oncology portfolios

by Lisa M. Jarvis
April 3, 2015 | APPEARED IN VOLUME 93, ISSUE 14

DEAL FRENZY

Novartis, Merck Serono add to flurry of immuno-oncology spending this year

◾ Bristol-Myers Squibb pays $60 million for an option on Bavarian Nordic’s prostate cancer vaccine.
◾ BMS pays $800 million to acquire Flexus for its IDO1 and TDO2 inhibitors.
◾ BMS pays Rigel $30 million to access TGF-β receptor kinase inhibitors.
◾ Amgen pays Kite Pharma $60 million to combine Amgen oncology targets with Kite’s CART platform.

NOTE: Deals are ordered from most recent to least recent.

The frenzy for cancer immunotherapy deals continued last week with two big pharma pacts. Novartis shelled out $200 million as part of a multiyear alliance with Aduro Biotech for preclinical cyclic dinucleotides. And Merck Serono paid $115 million to access Intrexon’s chimeric antigen T-cell (CART) technology.

Aduro’s cyclic dinucleotides activate the stimulator of interferon genes, or STING, pathway, triggering a broad immune response directed at tumor cells. Novartis, which has a complementary internal program to develop small-molecule STING activators, believes the approach will boost the types of tumors that can be treated with immunotherapy.

For Novartis, the Aduro deal adds yet another weapon to a considerable immunotherapy arsenal. The company is already committed to CART therapy, in which a patient’s own T cells are reengineered to home in on cancer, and later this year it will start clinical studies of three checkpoint inhibitors, antibodies designed to take the brakes off of the immune system.

That broad portfolio gives Novartis a number of treatments to choose from, a key advantage as the field of cancer immunotherapy moves toward combinations of drugs. “In this immune checkpoint space, you absolutely have to have combinations in order to get response rates up,” says Paul D. Rennert, head of the consulting firm SugarCone Biotech. “Otherwise, you have expensive drugs that are only going to work in the minority of patients.”

But, as Novartis’s hefty payment reflects, complementary drugs come at a premium. Rennert notes that Bristol-Myers Squibb’s $800 million acquisition of Flexus Biosciences, announced in February, “set a tone that anything differentiating and additive to the portfolio was going to get a lot of attention.”

Merck Serono’s deal with Intrexon diverges from that trend, Rennert adds. Merck Serono, which is broadening its immunotherapy portfolio beyond checkpoint inhibitors, is getting the CART technology for not much more than what Intrexon paid for it. In January, Intrexon and its oncology drug development partner, Ziopharm Oncology, paid $100 million in stock to license the technology from the University of Texas M. D. Anderson Cancer Center.

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