Novartis inks $800M upfront buyout of Gyroscope to continue eye disease gene therapy M&A spree

Gyroscope Therapeutics has been spun this way and that in 2021, going from a $148 million raise to a failed IPO to a $40 million investment from Sanofi in quick succession. But Novartis has ensured the gene therapy startup has ended the year at the top of its arc by inking a $1.5 billion buyout. 

Novartis has agreed to pay $800 million upfront and committed to milestone payments of up to $700 million to buy the British biotech. In return, Novartis will take control of a pipeline led by a gene therapy, GT005, that is in phase 2 development as a treatment for geographic atrophy (GA), an advanced form of dry age-related macular degeneration that causes vision loss.

GT005 is designed to improve outcomes in GA patients by increasing production of CFI, a complement regulatory protein. The mechanism is underpinned by evidence that overactivation of the complement system drives GA by causing unnecessary inflammation that damages healthy eye tissues.

Gyroscope is exploring exactly how many patients could benefit from the gene therapy in a pair of phase 2 clinical trials. One of the studies is enrolling patients with CFI mutations associated with low expression of the protein. Those patients amount to around 3% of the total GA population, equivalent to 100,000 people in the U.S. and major markets in Western Europe.

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The second trial is testing GT005 in patients with at least one genetic variant in a complement gene. That broader study covers around 95% of the GA population, pointing to the potential for Novartis to target a market with several million patients if the trial finds GT005 to be safe and efficacious.  

Novartis, which triggered a wave of gene therapy M&A by acquiring AveXis for $8.7 billion in 2018, has experience of selling genetic medicines to treat eye diseases through its licensing of Spark Therapeutics’ Luxturna outside the U.S. Marie-France Tschudin, president, Novartis Pharmaceuticals, expects that experience to benefit GT005.

“With our own pioneering research in ocular gene therapies and our experience gained from bringing Luxturna to inherited retinal dystrophy patients outside of the U.S., Novartis has a well-established expertise in ocular gene therapies that will position us well to continue developing this promising one-time treatment,” Tschudin said in a statement. 

GT005, as well as preclinical prospect GT011, will slot into a Novartis pipeline already dotted with other acquired ocular gene therapy assets. Novartis picked up two preclinical optogenetic AAV gene therapy programs for treating inherited retinal dystrophies and GA last year by acquiring Vedere Bio. And just months ago, Novartis added another vision loss gene therapy to its pipeline by buying Arctos Medical.