Otsuka backs Akebia with $1B deal on anemia drug vadadustat

Akebia CEO John Butler

Akebia's determination to self-develop its anemia drug vadadustat in the U.S. has been overturned by a not-to-be-missed deal with Otsuka valued at up to $1 billion.

Otsuka is offering a hefty $265 million in committed payments for the co-development and co-marketing rights to the potential blockbuster, an oral hypoxia-inducible factor (HIF) stabilizer in development for the treatment of anemia associated with chronic kidney disease (CKD).

CEO John Butler told FierceBiotech the deal is transformative, as the cash injection is more than enough to fund Akebia's Phase III program and "offers the flexibility to execute on our operating plan and continue to build the pipeline."

"Pretty traditional data, regulatory and sales achievement milestones" totaling $765 million could drive the value of the deal north of $1 billion, he added.

Butler said the change of heart on going it alone in the U.S. came because the alliance with Otsuka was "such a compelling transaction, with such a compelling partner," adding it would also allow the company to seek out a European collaboration "on our terms—right deal, right partner, right price."

Akebia already has a $350 million agreement in place with Mitsubishi Tanabe for a clutch of Asian markets, and has been searching for a European partner since 2015. The additional funds from Otsuka will fund the company's activities at least through to the end of 2018, Butler told investors on a conference call. Previously, Akebia has indicated it will be a position to file for approval of vadadustat in 2019.

The new deal could also bring forward additional trials that could help flesh out vadadustat's clinical profile, including a study in patients who do not respond well to current injectable erythropoiesis stimulating agents (ESAs) like Amgen's Epogen and Aranesp and Johnson & Johnson's Procrit. These patients are typically treated with ESA doses about three times higher than normal and have significantly higher morbidity and mortality rates.

Another trial looking at dosing the drug three times a week rather than every day, which may be more attractive to healthcare payers, is also planned.

Interestingly, Akebia will take the lead on some commercial aspects on the program in the U.S., including pricing and negotiations with payers, said Butler. He noted that payers have a lot of control in renal anemia and it can take new products time to build momentum, so the added promotion muscle from Otsuka will help accelerate "commercial development and promotional reach."

The reality is that Akebia could well need deep-pocketed partners as it is facing some serious competition in the CKD anemia category from the likes of GlaxoSmithKline and AstraZeneca/Fibrogen.

GSK started late-stage trials of its oral HIF inhibitor daprodustat last month while AZ and FibroGen's roxadustat began a Phase III program in 2014 and is set for first marketing applications in 2018.

Akebia has been locked in patent disputes with FibroGen in Europe over their HIF-targeting drugs, and chalked up a couple of victories this year. Two further opposition hearings are scheduled to take place in 2017.