Vivek Ramaswamy’s Roivant backs Arbutus’ hepatitis B program

With hepatitis C virus starting to look like a conquered foe, attention is turning to the fight against chronic hepatitis B virus (HBV), and Vivek Ramaswamy’s Roivant has just put another sizable block of cash behind a program in development at Canada’s Arbutus Biopharma.

The $116 million share purchase deal comes on the heels of positive phase 2 data for Arbutus’ lead HBV candidate ARB-1467, which suggest the gene-silencing drug can further reduce hepatitis B surface antigen (HBsAg) levels when added to Gilead’s mainstay HBV drug Viread (tenofovir).

Roivant is already the largest backer of the RNA company—and Ramaswamy is its chairman—but the increased stake provides the Vancouver-based biotech with the resources it needs to accelerate the development of ARB-1467 and its other clinical and preclinical candidates.

The deal puts some clear air between Ramaswamy and the deep disappointment reported late last month when Roivant’s Alzheimer’s disease unit Axovant was forced to abandon its intepirdine candidate after a failed phase 3 trial.

Around $50 million of the total will close shortly, according to Roivant, which says the two companies will “explore working together to leverage Roivant’s infrastructure to accelerate more efficient development of Arbutus’ HBV drug pipeline” as well as non-HBV programs.

Ramaswamy also proffers the possibility of additional funding, saying: “We look forward to providing strategic and operational support to Arbutus, while also maximizing the value of Arbutus’ other assets, including through potential additional investment where required.”

Arbutus’ other platforms include LNP and GalNAc platforms for the delivery of novel therapeutics including those based on RNA interference, mRNA, and gene-editing technologies.

“This financing meaningfully extends Arbutus’ operating runway to enable the generation of important clinical data for multiple pipeline programs,” said the Canadian firm’s CEO, Mark Murray.

With HCV now a curable disease thanks to new directly acting antiviral drugs, chronic HBV has now inherited its mantle as the big challenge in viral hepatitis—and despite decades of research there remains no curative treatment. Most patients who contract HBV manage to shake off the infection, but a sizable minority develop chronic disease that resists drug treatment and increases the risk of liver damage, cirrhosis and liver cancer.

Any successful HBV candidate is likely to be a big seller. The Centers for Disease Control and Prevention (CDC) reckons that up to 350 million people globally may be chronically infected with HBV, with the World Health Organization putting the annual death toll from the disease at more than 780,000.

Earlier this year, analysts at William Blair said the market for an HBV cure could be similar in size to that for HCV, which has been a multibillion-dollar opportunity for the last few years, although the market has started to contract. They said the potential market could be as much as $200 billion in cumulative sales over two decades and that potential is likely to drive consolidation among HBV players over the next five years.

“I am pleased with the progress that Arbutus has made over the past two years, but I believe that the company’s most exciting days are ahead of it,” said Ramaswamy. “HBV is one of the most devastating diseases impacting patients globally, and a cure remains elusive.”