Boehringer strikes $250M deal for Phase I NASH drug

Boehringer Ingelheim has made a quick decision about Pharmaxis' non-alcoholic steatohepatitis (NASH) drug, striking a $250 million deal to buy the Phase I asset just two months after inking an option to acquire the program.

Sydney, Australia-based Pharmaxis granted Boehringer an exclusive option to buy the program in March, at which time it pocketed $1.4 million. Having had a chance to kick the tires and see Phase I data, Boehringer has opened its checkbook for the real deal, handing over $31 million upfront and committing to $222 million in milestones tied to the development and commercialization of PXS4728A in NASH. Pharmaxis could net a similar amount if Boehringer successfully develops PXS4728A in a second indication, swelling the potential total value of the deal to $600 million.

The outlay tucks Boehringer in behind the frontrunners in the NASH race. While Genfit and Intercept Pharmaceuticals ($ICPT) are moving toward Phase III, PXS4728A has just come through an interim analysis of a 48-person Phase I trial. PXS4728A cleared the single ascending dose stage without triggering any alarms. A multiple ascending dose study of 24 patients is now underway. The data put Boehringer alongside Gilead Sciences ($GILD), Shire ($SHPG) and others in the pack of drugmakers chasing Intercept and Genfit.

Boehringer thinks Pharmaxis' semicarbazide-sensitive amine oxidase/vascular adhesion protein 1 (SSAO/VAP-1) PXS4728A stands out from these other candidates. The drug is designed to work by blocking leucocyte adhesion and tissue infiltration during inflammatory processes, an approach that differs from those taken by Intercept and Genfit. Pharmaxis also sees PXS4728A as a possible treatment for chronic obstructive pulmonary disease (COPD), in which it may slow the movement of neutrophils into the lung that leads to tissue damage.

Pharmaxis was plugging away at these ideas without generating much excitement before Boehringer stepped in. Setbacks for a cystic fibrosis drug caused Pharmaxis' stock to tank in 2013, dragging its value down further still from the peaks of 2007. The company had a market cap of around $40 million for most of the past two years but has been buoyed by Boehringer's interest. Shares jumped 50% following the news to give Pharmaxis a market cap of $63 million.

- read the release

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