Incyte pays $53M upfront for Calithera I-O drug, setting stage for anti-PD-1 combo trials in solid tumors

Money
The deal gives Incyte a phase 1 asset that is being trialled in combination with Bristol-Myers' Opdivo

Incyte has paid $53 million upfront for Calithera Biosciences’ small molecule arginase inhibitor CB-1158. The deal sees Incyte sign up to codevelop an asset it sees complementing PD-1 drugs by reversing an immunosuppressive block that dampens the activity of immuno-oncology therapies.

Wilmington, DE-based Incyte is paying $45 million upfront and making an $8 million investment in Calithera to enter into the global collaboration and license agreement. The pact puts Incyte on the hook for 70% of the global development budget for CB-1158, as well as milestone payments that could total upward of $430 million. Incyte and Calithera have agreed a 60-40 split on U.S. profits, although the latter can forego these earnings in favor of more milestones and freedom from its commitment to the R&D budget.

In exchange for the outlay, Incyte is securing the rights to a therapy with the potential to boost the effectiveness of drugs in its immuno-oncology pipeline.

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“Arginase-expressing tumor-infiltrating myeloid cells have been shown to play an important role in orchestrating the immune suppressive microenvironment in cancer; but, to date, therapeutic targeting of the arginase enzyme has remained elusive. The addition of this first-in-class, small molecule arginase inhibitor, CB-1158, to our portfolio expands our innovative immuno-oncology pipeline,” Incyte CSO Reid Huber said in a statement.

If CB-1158 works as hoped, it will hinder tumor growth by targeting arginase, an enzyme linked to the depletion of arginine in the tumor microenvironment and subsequent stunting of cytotoxic T cell and natural killer cell activity.

Calithera thinks this mechanism of action makes CB-1158 a natural bedfellow of anti-PD-1 drugs. The phase 1 trial Calithera started last year is looking at CB-1158 as a monotherapy and alongside Bristol-Myers Squibb’s Opdivo in patients with a handful of different types of solid tumor. Calithera sees CB-1158 working in any cancer that features arginase-secreting cells.

When the deal closes later this quarter, CB-1158 will join four other assets—including a PD-1 drug—in Incyte’s cancer immunotherapy pipeline.

Shares in Calithera rose more than 25% in premarket trading·