In the week that Pfizer was rewarded for its $4.5 billion buyout of Anacor after the FDA approved its eczema med Eucrisa (crisaborole), rival Big Pharma Novartis wants to get in on the act as it announces a deal to buy Ziarco and its leading eczema candidate.
The U.K.-based biotech, which has listed Amgen and Pfizer among its investors, lives in the same town in England (Sandwich, Kent) that Pfizer exited five years ago. The company has been working on a once-daily oral H4 receptor antagonist in development for eczema, known as ZPL-389, and it is this med that Novartis has bought into.
How much for? As is common these days, the pair are keeping quiet on the front. It’s not all been smooth sailing in testing, however, as it recently released top-line data from a phase 2a study that showed it missed an endpoint, but succeeded against another measure that Ziarco plans to make the focal point of the upcoming larger trial.
In that study, while ZPL-389 showed a clinically meaningful improvement in pruritus (itching) and NRS (a 0-10 numerical rating scale completed by the patients), which was reduced by 3 points (around 42%) compared to around 37% for placebo, this was not statistically significant. But it did show a clinically and statistically significant reduction in signs and symptoms of moderate to severe atopic dermatitis.
Back in the summer, the plan had been to raise a Series C round to fund the advance ZPL-389 into a phase 2b trial. But there were also rumors that Ziarco had started working with financial advisory firm Rothschild & Co to see whether it can land a buyout bid that meets its valuation of its business.
One of the anonymous sources, first quoted by Bloomberg, put the potential value of the deal at upward of $1 billion when milestones and royalties are taken into account.
Given that its lead candidate is yet to enter phase 2b and missed an endpoint in its previous mid-stage study, Novartis is likely to have loaded its deal with milestones and royalties, while minimizing the size of the upfront payment, to mitigate the risk that the drug will never make it to market.
“There is an unmet need for innovative, effective and safe oral treatment options for people living with eczema,” said Vasant Narasimhan, global head of drug development and CMO of Novartis.
“We are proud of our dermatology capabilities shown by the recent successful launches of Cosentyx and Xolair. Now we're excited about a potential new medicine for people with eczema through the acquisition of Ziarco and the addition of a first-in-class oral H4 receptor antagonist to our growing pipeline.”
The Swiss major will hope to have the kind of success that Pfizer had with its Anacor buy, with Eucrisa said to be a blockbuster in waiting.