Axovant buys more gene therapies, setting it up for a busy 2019

Axovant CEO Pavan Cheruvu
Axovant CEO Pavan Cheruvu (Axovant)

Axovant has licensed two gene therapies from the University of Massachusetts Medical School (UMMS). The deal accelerates Axovant’s evolution into a gene therapy specialist by giving it control of two assets that are in or near the clinic.

Following the failures of intepirdine and nelotanserin, Axovant purged its pipeline of small molecules and set out to buy a roster of gene therapies. The pivot got underway with a deal for clinical-phase Parkinson’s disease gene therapy AXO-Lenti-PD in June and continued with the licensing of a gene therapy treatment for oculopharyngeal muscular dystrophy (OPMD) the following month.

While the OPMD gene therapy is due to enter human testing next year, the pivot nonetheless left Axovant’s clinical pipeline looking a little light. The latest gene therapy deal goes some way toward addressing that issue.

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Axovant is paying UMMS $10 million upfront for the rights to two gene therapies designed to treat GM1 and GM2 gangliosidosis, lysosomal storage disorders that cause the potentially fatal build up of toxic gangliosides. The deal commits Axovant to up to $24.5 million in development and regulatory milestones, plus up to $39.8 million in commercial milestones and tiered mid-single-digit royalties. 

The more advanced of the two gene therapies, AXO-AAV-GM2, is already in clinical development in patients with GM2 gangliosidosis, a group of rare disorders also known as Tay-Sachs and Sandhoff diseases. Axovant expects to have data from the trial in the first quarter of next year. 

UMMS’ other gene therapy, AXO-AAV-GM1, is due to move into the clinic in the first half of next year. The trial will be conducted at the NIH, which has accrued a repository of natural history data on the diseases Axovant thinks it could use as a control in registrational studies. Axovant expects to have initial data from the GM1 trial in the second half of next year.

The addition of two clinical readouts to Axovant’s schedule for 2019 means the company’s calendar is now fairly well stocked with potentially business boosting events. Axovant’s other big moment will come in March, when it is due to release clinical data on its Parkinson’s gene therapy.  

With clinical trial activity ramping up again, Axovant is making a public offering of its stock. At the time of writing, Axovant is yet to say how much it hopes to raise, but the shelf registration covering the offering permits the sale of up to $750 million in stock. Axovant ended September with $91 million in cash, having run up operating expenses of $81 million over the first six months of the year.

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