In R&D rethink, Novartis ditches part of $2.6B Xencor bispecific pact

Novartis headquarters
Novartis isn't backing out of the deal completely. (Wikimedia Commons/Andrew/Flickr)

Citing “strategic pipeline reprioritization by Novartis,” Xencor says its Swiss Big Pharma partner is handing back the research and sales rights to a bispecific antibody penned under a multibillion-dollar biobucks deal in 2016.

Back then, Novartis and Xencor signed up to a $150 million upfront, $2.41 billion biobucks deal that saw Novartis agree to develop a pair of candidates: XmAb14045 for acute myeloid leukemia (AML) and XmAb13676 for B-cell malignancies.

Under the original pact, the pair were to share development costs for these candidates with Xencor keeping U.S. commercialization rights and Novartis gaining them in the rest of the world.

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Novartis also got worldwide rights to four additional targets that will be engineered by Xencor. And the pharma got a worldwide, nonexclusive license to use Xencor’s XmAb Fc technologies in up to 10 molecules.

RELATED: Novartis goes bispecific with Xencor in up to $2.6B immuno-oncology deal

But today, Xencor said it will be regaining “rights to develop and commercialize XmAb13676, a CD20 x CD3 bispecific antibody, from Novartis effective June 20, 2019, due to strategic pipeline reprioritization by Novartis.” The drug is currently in phase 1, with data expected this year. No further details were given.

But Novartis isn’t backing out completely from the deal, as the pair will “continue to share costs for the worldwide development of XmAb14045 with Xencor maintaining U.S. commercialization rights and Novartis having commercialization rights in the rest of the world, and worldwide development costs for XmAb13676 will be shared until June 2020,” according to a release.

Bassil Dahiyat, Ph.D., president and chief at Xencor, said: “We continue to work closely with Novartis across multiple programs in the collaboration, and both companies are eager to advance XmAb14045 in clinical development.

“Recently we presented encouraging early data from our phase 1 study in patients with relapsed/refractory AML, observing multiple complete remissions on a weekly dosing schedule, and we continue to optimize dose in that study. Novartis also has internal XmAb preclinical bispecific programs progressing.

“Xencor will continue to develop XmAb13676 as planned, and we believe its tuned potency holds potential for the treatment of patients with B-cell malignancies.”

This comes three months after topline results from a phase 2 test showed Xencor’s lead CD19-targeting antibody missed its primary endpoint in lupus. However, the company said it still planned to move forward with a phase 3 of XmAb5871 in a separate indication for IgG4-related disease—a chronic inflammatory disorder—while potentially seeking a partner to carry the drug the rest of the way forward in systemic lupus erythematosus.

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