Janssen will not be buying back the rights to a drug it shipped out to Provention Bio back in 2017 after it failed to move the needle in Crohn’s disease.
Two years back, Janssen teamed with startup Provention in a licensing agreement that gave the biotech a deal to work on the Big Pharma’s small-molecule CSF-1R inhibitor JNJ-40346527 (now PRV-6527) for Crohn's.
Under that deal, Janssen had the right to buy back PRV-6527 for a one-time payment of $50 million and single-digit royalties on future net sales.
But in a recent Securities and Exchange Commission filing, Provention says: “Representatives of Provention Bio were informed by Janssen’s CSF-1R inhibitor (PRV-6527) alliance manager, via teleconference and confirmatory email, that Janssen no longer intends to take up an option to buy back the rights to the compound which has been under development by the company for Crohn’s disease.”
The plan now is for Janssen “to support and expand the field” of the deal, penned back in April 2017, by “assist[ing] in transferring the compound’s manufacturing rights to the company or a third party manufacturer and will irrevocably waive its rights to assume distribution and pricing decision making authority.”
The biotech has already said it won’t work on the drug anymore in-house but “may explore sublicensing the compound to a third party.” It gave no extra color on this in the filing.
This comes less than three months after Provention revealed disappointing midstage data for the drug. The so-called phase 2a Prince test enrolled nearly 100 patients with moderate-to-severe Crohn's disease who either hadn’t had a biologic therapy or had failed at least one biologic drug.
The primary efficacy endpoint of the study was the change in the Crohn's Disease Activity Index score at week 12, which it missed.
The biotech blamed a “high placebo response” for the flop, which also dragged down its shares. In the intervening months they have picked back up, although were off several percentage points Thursday.